SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
( ) Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-12
GUARANTY FINANCIAL CORPORATION
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
(X) No fee required
( ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
item 22(a)(2) of Schedule 14A.
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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:
[Definitive Proxy Statement]
GUARANTY FINANCIAL CORPORATION
Dear Shareholders:
You are cordially invited to attend the Annual Meeting of Shareholders
of Guaranty Financial Corporation ("Guaranty"), which will be held on April 25,
2002, at 10:00 a.m., at the Glenmore Country Club, 1750 Piper Way, Keswick,
Virginia (the "Meeting"). At the Meeting, three directors will be elected for
terms of three years each.
Whether or not you plan to attend in person, it is important that your
shares be represented at the Meeting. Please complete, sign, date and return
promptly the form of proxy that is enclosed with this mailing. If you decide to
attend the Meeting and vote in person, or if you wish to revoke your proxy for
any reason prior to the vote at the Meeting, you may do so, and your proxy will
have no further effect.
The Board of Directors and Management of Guaranty appreciate your
continued support and look forward to seeing you at the Meeting.
Sincerely yours,
/s/ William E. Doyle, Jr.
William E. Doyle, Jr.
President and Chief Executive Officer
Charlottesville, Virginia
March 25, 2002
GUARANTY FINANCIAL CORPORATION
1658 State Farm Boulevard
Charlottesville, Virginia 22911
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on April 25, 2002
NOTICE IS HEREBY GIVEN that the Annual Meeting (the "Meeting") of the
holders of shares of Common Stock ("Common Stock") of Guaranty Financial
Corporation ("Guaranty") will be held at the Glenmore Country Club, 1750 Piper
Way, Keswick, Virginia on April 25, 2002 at 10:00 a.m., for the following
purposes:
1. To elect three directors for terms of three years
each, or until their successors are elected and
qualify; and
2. To transact such other business as may properly come
before the Meeting.
Holders of shares of Common Stock of record at the close of business on
March 8, 2002, will be entitled to vote at the Meeting.
You are requested to fill in, sign, date and return the enclosed proxy
promptly, regardless of whether you expect to attend the Meeting. A postage-paid
return envelope is enclosed for your convenience.
If you are present at the Meeting, you may vote in person even if you
have already returned your proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Esther S. Sheler
Esther S. Sheler
Secretary
Charlottesville, Virginia
March 25, 2002
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YOU ARE CORDIALLY INVITED TO ATTEND THIS MEETING. IT IS IMPORTANT THAT YOUR
SHARES BE REPRESENTED REGARDLESS OF THE NUMBER THAT YOU OWN. EVEN IF YOU PLAN TO
BE PRESENT, YOU ARE URGED TO COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY
PROMPTLY IN THE ENVELOPE PROVIDED. IF YOU ATTEND THIS MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY YOUR PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN
WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
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GUARANTY FINANCIAL CORPORATION
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
April 25, 2002
GENERAL INFORMATION
This Proxy Statement is furnished to holders of common stock, par value
$1.25 per share ("Common Stock"), of Guaranty Financial Corporation ("Guaranty")
in connection with the solicitation of proxies by the Board of Directors of
Guaranty to be used at the Annual Meeting of Shareholders to be held on April
25, 2002, at 10:00 a.m., at the Glenmore Country Club, 1750 Piper Way, Keswick,
Virginia, and any adjournment thereof (the "Meeting"). At the Meeting, three
directors will be elected for terms of three years each.
The principal executive offices of Guaranty are located at 1658 State
Farm Boulevard, Charlottesville, Virginia 22911. The approximate date on which
this Proxy Statement and the accompanying proxy card are being mailed to
Guaranty's shareholders is March 25, 2002.
The Board of Directors has fixed the close of business on March 8,
2002, as the record date (the "Record Date") for the determination of the
holders of shares of Common Stock entitled to receive notice of and to vote at
the Meeting. At the close of business on the Record Date, there were 1,961,727
shares of Common Stock outstanding held by approximately 1,077 shareholders.
Each share of Common Stock is entitled to one vote on all matters to be acted
upon at the Meeting. In the election of directors, those receiving the greatest
number of votes will be elected even if they do not receive a majority.
As of the Record Date, directors and executive officers of Guaranty and
their affiliates, as a group, owned of record and beneficially a total of
454,224 shares of Common Stock, or approximately 22.53% of the shares of Common
Stock outstanding on such date. Directors and executive officers of Guaranty
have indicated an intention to vote their shares of Common Stock FOR the
election of the nominees set forth on the enclosed proxy.
A shareholder may abstain or (only with respect to the election of
directors) withhold his or her vote (collectively, "Abstentions") with respect
to each item submitted for shareholder approval. Abstentions will be counted for
purposes of determining the existence of a quorum. Abstentions will not be
counted as voting in favor of the relevant item.
A broker who holds shares in "street name" has the authority to vote on
certain items when it has not received instructions from the beneficial owner.
Except for certain items for which brokers are prohibited from exercising their
discretion, a broker is entitled to vote on matters put to shareholders without
instructions from the beneficial owner. Where brokers do not have or do not
exercise such discretion, the inability or failure to vote is referred to as a
"broker nonvote." Under the circumstances where the broker is not permitted to,
or does not, exercise its discretion, assuming proper disclosure to Guaranty of
such inability to vote, broker nonvotes will not be counted for purposes of
determining the existence of a quorum, and also will not be counted as voting in
favor of or against the particular matter.
Shareholders of Guaranty are requested to complete, date and sign the
accompanying form of proxy and return it promptly to Guaranty in the enclosed
envelope. If a proxy is properly executed and returned in time for voting, it
will be voted as indicated thereon. If no voting instructions are given, proxies
received by Guaranty will be voted for approval of the directors nominated for
election.
Any shareholder who executes a proxy has the power to revoke it at any
time before it is voted by giving written notice of revocation to Guaranty, by
executing and delivering a substitute proxy to Guaranty or by attending the
Meeting and voting in person. If a shareholder desires to revoke a proxy by
written notice, such notice should be mailed or delivered, so that it is
received on or prior to the meeting date, to Esther S. Sheler, Secretary,
Guaranty Financial Corporation, 1658 State Farm Boulevard, Charlottesville,
Virginia 22911.
The cost of soliciting proxies for the Meeting will be borne by
Guaranty.
ELECTION OF DIRECTORS
Three directors are to be elected to serve for terms of three years
each. The Board of Directors has no reason to believe that any of the nominees
will be unavailable. William E. Doyle, Jr. is standing for election for the
first time.
The Board of Directors acts as a Nominating Committee for selecting the
nominees for election as directors. Shareholders entitled to vote for the
election of directors may nominate candidates for consideration by the Board of
Directors under procedures that Guaranty has established. See "Proposals for
2003 Annual Meeting of Shareholders."
The following information sets forth the names, ages, principal
occupations and business experience for all nominees and incumbent directors.
The date shown for first election as a director in the information below
represents the year in which the nominee or incumbent director was first elected
to the Board of Directors of Guaranty or previously to the Board of Directors of
Guaranty Bank, Guaranty's predecessor and now wholly owned subsidiary. Unless
otherwise indicated, the business experience and principal occupations shown for
each nominee or incumbent director has extended five or more years.
Nominees for Election
for Terms Expiring in 2005
William E. Doyle, Jr., 49, has been a director since 2001.
Mr. Doyle has been Guaranty's President and Chief Executive Officer
since May 2001. From November 1997 to May 2001, he was Senior Vice
President, Mortgage and Retail Services, of The Middleburg Bank and,
from 1996 to 1997, he was a private consultant in the banking industry.
Jason I. Eckford, Jr., 72, has been a director since 1999.
Mr. Eckford is President of Eckford Financial Services in
Charlottesville, Virginia.
Harry N. Lewis, 74, has been a director since 1981 and has been Vice Chairman of
Guaranty's Board of Directors since 1989.
Mr. Lewis is owner of O'Neill Mortgage Corp., a mortgage company in
Charlottesville, Virginia that he acquired in 1990. He has also been
President of Lewis Insurance Agency, Inc., an insurance sales company
in Charlottesville, Virginia, since July 1952.
2
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
NOMINEES SET FORTH ABOVE.
Incumbent Directors Serving
for Terms Expiring in 2003
Douglas E. Caton, 59, has been a director since 1981 and has been Chairman of
Guaranty's Board of Directors since 1989.
Mr. Caton is a commercial real estate investor and developer. He is
also Chief Executive Officer and owner of Management Services
Corporation, a real estate management and development company. A combat
veteran of the Vietnam War, Mr. Caton is a Major General in the United
States Army Reserve with over 32 years of service.
John R. Metz, 64, has been a director since 1980.
Mr. Metz is a pharmacist at Martha Jefferson Hospital in
Charlottesville, Virginia.
James R. Sipe, Jr., 46, has been a director since 1996.
Mr. Sipe is an associate broker with Coldwell Banker Funkhouser
Realtors (formerly Prudential Funkhouser & Associates), a real estate
sales company in Harrisonburg, Virginia.
Incumbent Directors Serving
for Terms Expiring in 2004
Henry J. Browne, 69, has been a director since 1976.
Mr. Browne is an architect in private practice with a studio in Boca
Grande, Florida.
Oscar W. Smith, Jr., 71, has been a director since 1976.
Mr. Smith is owner of K-B Management Co. in Charlottesville, Virginia.
The Board of Directors and Committees
Meetings of the Board of Directors are held regularly each month, and
there is also an organizational meeting following the conclusion of the Annual
Meeting of Shareholders. The Board of Directors held 12 meetings in the year
ended December 31, 2001. For the year ended December 31, 2001, each of
Guaranty's directors attended at least 75% of the aggregate of the total number
of meetings of the Board of Directors and the total number of meetings of
committees on which the respective director served.
The Board of Directors has a standing Audit Committee. The Audit
Committee consists of Mr. Metz, as Chairman, and Messrs. Caton and Smith. The
Audit Committee is responsible for the selection and recommendation of the
independent accounting firm for the annual audit and to establish, and assure
the adherence to, a system of internal controls. It reviews and accepts the
reports of Guaranty's independent auditors, internal auditor and federal
examiners. The Audit Committee met three times during the year ended December
31, 2001. Additional information with respect to the Audit Committee is
discussed below under "Audit Information."
3
The Executive Committee has assumed the responsibilities of the
Compensation Committee with respect to the review of senior management's
performance and compensation and the review and setting of guidelines for
compensation of all employees. The Executive Committee consists of Mr. Caton, as
Chairman, and Messrs. Eckford and Sipe. The Executive Committee met four times
during the year ended December 31, 2001.
Security Ownership of Management
The following table sets forth information as of March 1, 2002,
regarding the number of shares of Common Stock beneficially owned by each
director, each individual named in the Summary Compensation Table below and all
current directors and executive officers as a group. Beneficial ownership
includes shares, if any, held in the name of the spouse, minor children or other
relatives of the individual living in such person's home, as well as shares, if
any, held in the name of another person under an arrangement whereby the
director or executive officer can vest title in himself at once or at some
future time.
Common Stock
Name Beneficially Owned (1) Percentage of Class
---- ---------------------- -------------------
Thomas P. Baker 0 --
Henry J. Browne 38,637 1.97%
Douglas E. Caton 323,115 16.45%
Thomas F. Crump 10,000 *
William E. Doyle, Jr. 20,000 1.01%
Jason I. Eckford, Jr. 2,500 *
Harry N. Lewis 7,616 *
John R. Metz 16,082 *
Donna W. Richards 0 --
Richard L. Saunders 10,000 *
James R. Sipe, Jr. 4,100 *
Oscar W. Smith, Jr. 22,174 1.13%
All current directors and executive
officers as a group (10 Persons) 454,224 22.53%
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* Percentage of ownership is less than one percent of the outstanding shares
of Common Stock.
(1) Amounts disclosed include shares of Common Stock that certain individuals
have the right to acquire upon the exercise of stock options exercisable
within 60 days of March 1, 2002, as follows: Mr. Browne, 2,400; Mr. Caton,
2,400; Mr. Crump, 10,000; Mr. Doyle, 20,000; Mr. Lewis, 2,400; Mr. Metz,
2,400; Mr. Saunders, 10,000; Mr. Sipe, 2,400; and Mr. Smith, 2,400.
4
Security Ownership of Certain Beneficial Owners
The following table sets forth information as of March 1, 2002,
regarding the number of shares of Common Stock beneficially owned by all persons
who own five percent or more of the outstanding shares of Common Stock.
Common Stock
Name and Address Beneficially Owned (1) Percentage of Class
---------------- ---------------------- -------------------
Douglas E. Caton 323,115 16.45%
4 Deer Park
Earlysville, Virginia
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(1) Amounts disclosed include 2,400 shares of Common Stock that Mr. Caton has
the right to acquire upon the exercise of stock options exercisable within
60 days of March 1, 2002.
Executive Officers Who Are Not Directors
Thomas F. Crump, 45, has been Senior Vice President and Chief Financial
Officer since September 2000. From July 1997 to September 2000, he was Senior
Vice President and Controller of Heilig-Meyers Company ("Heilig-Meyers") and,
from June 1993 to July 1997, he was Vice President and Controller of
Heilig-Meyers.
Richard L. Saunders, 48, has been Senior Vice President and Chief
Credit Officer since February 2000. From June 1998 to February 2000, he was Vice
President and a commercial banker of Guaranty and, from April 1996 to June 1998,
he was Vice President and a business banker with Jefferson National Bank and its
successor, Wachovia Bank. Mr. Saunders also acted as Guaranty's chief executive
officer from March 2001 to May 2001.
5
Executive Compensation
Summary of Cash and Certain Other Compensation
The following table shows, for the fiscal years ended December 31,
2001, 2000 and 1999, the cash compensation paid by Guaranty, as well as certain
other compensation paid or accrued for those years, to the named Executive
Officers in all capacities in which they served.
Summary Compensation Table
Annual Compensation Long-Term Compensation
------------------- ----------------------
Securities
Name and Other Annual Underlying All Other
Principal Position Year Salary ($) Bonus ($) Compensation ($) Options Compensation ($)(1)
------------------ ---- ---------- --------- ---------------- ------- -------------------
William E. Doyle, Jr. 2001 118,310 -- 47,201 (3) 5,000 --
President and Chief
Executive Officer (2)
Thomas P. Baker 2001 191,697 -- * -- 820
Former President and 2000 157,506 -- * -- 3,938
Chief Executive Officer 1999 147,500 -- * -- 3,750
(4)
Thomas F. Crump 2001 151,575 -- * 100 2,293
Senior Vice President and 2000 45,202 -- * -- --
Chief Financial Officer
(5)
Richard L. Saunders 2001 122,969 -- * 100 3,689
Senior Vice President and 2000 89,262 -- * -- 2,684
Chief Credit Officer (6)
Donna W. Richards 2001 129,461 -- * -- 3,237
Former Senior Vice 2000 136,505 -- * -- 3,203
President and Chief 1999 125,833 20,000 (8) * 22,500 2,297
Operating Officer (7)
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* All benefits that might be considered of a personal nature did not exceed
the lesser of $50,000 or 10% of total annual salary and bonus.
(1) Amounts reflect Guaranty's matching contribution under its Section 401(k)
retirement plan.
(2) Mr. Doyle's employment with Guaranty commenced in May 2001.
(3) Amount includes $33,758 in relocation expenses in connection with the
commencement of Mr. Doyle's employment.
(4) Mr. Baker's employment with Guaranty terminated in March 2001. The amount
shown for 2001 includes payments in 2001 under the terms of a severance
agreement with Guaranty.
(5) Mr. Crump's employment with Guaranty commenced in September 2000.
(6) Mr. Saunders became an executive officer of Guaranty in September 2000. The
amounts shown for 2000 include all compensation paid to Mr. Saunders by
Guaranty from January 1, 2000.
(7) Ms. Richards' employment with Guaranty terminated in July 2001. The amount
shown for 2001 includes payments in 2001 under the terms of a severance
agreement with Guaranty.
(8) In February 1999, Ms. Richards was paid a one-time signing bonus in
connection with her entering into an employment agreement with Guaranty.
6
Stock Option Grants
The following table sets forth for the year ended December 31, 2001,
the grants of stock options to the named Executive Officers:
Option Grants In Last Fiscal Year
Percent of Total
Number of Securities Options Granted to
Underlying Options Employees in Fiscal Exercise or Base
Name Granted (#) (1) Year (%) (2) Price ($/Share) Expiration Date
---- --------------- ------------ --------------- ---------------
William E. Doyle, Jr. 5,000 30.3 7.90 May 10, 2011
100 0.6 8.30 November 13, 2006
Thomas F. Crump 100 0.6 8.30 November 13, 2006
Richard L. Saunders 100 0.6 8.30 November 13, 2006
-----------------------
(1) Stock options were granted at or above the fair market value of the shares
of Common Stock at the date of grant. The grant to Mr. Doyle of options to
purchase 5,000 shares of Common Stock is immediately exercisable. The grant
to each of Messrs. Doyle, Crump and Saunders of options to purchase 100
shares of Common Stock becomes exercisable on November 14, 2002.
(2) Options to purchase 16,512 shares of Common Stock were granted to employees
during the year ended December 31, 2001.
Option Exercises and Holdings
In the year ended December 31, 2001, no stock options were exercised by
any of the named Executive Officers. The following table sets forth the amount
and value of stock options held by the named Executive Officers as of December
31, 2001.
Fiscal Year-End Option Values
Number of
Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
Fiscal Year End (#) (1) at Fiscal Year End (2)
----------------------- ----------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
William E. Doyle, Jr. 5,000 100 $500 --
Thomas F. Crump -- 100 -- --
Richard L. Saunders 5,000 100 -- --
----------------
(1) Each of these options relates to shares of Common Stock.
(2) The value of unexercised in-the-money options at fiscal year end was
calculated by determining the difference between (i) the fair market
value of common stock underlying the options at December 31, 2001 ($8.00)
and (ii) the exercise price of the options. Except for Mr. Doyle's
options to purchase 5,000 shares of Common Stock, which have an exercise
price of $7.90 per share, no options disclosed in the table were
in-the-money as of December 31, 2001.
7
Directors' Fees
Directors, excluding directors who are officers of Guaranty, receive
fees of $550 for each meeting of the Board of Directors attended and $300 for
each Executive, Loan and Audit Committee meeting attended. Mr. Caton, who is an
ex officio member of all committees and devotes additional time to Guaranty's
affairs as Chairman of the Board of Directors, received a fee of $32,500 in the
fiscal year ended December 31, 2001, in lieu of any fees for attending Board of
Directors and committee meetings.
In 1997, Guaranty granted to each of its non-employee directors options
to purchase 4,000 shares of Common Stock. Of this amount, options to purchase
800 shares of Common Stock vest each year and are exercisable for a period of
three years. Such options, which Guaranty granted under its 1991 Incentive Plan,
have an exercise price at or above the fair market value of the Common Stock as
of the date of the grant.
Beginning in 2002, Guaranty will annually issue 150 shares of Common
Stock to each of its non-employee directors. Such shares are not issued under
any of Guaranty's plans, and they are in addition to the cash compensation that
the directors receive.
Employment Agreements
Guaranty and William E. Doyle, Jr. are parties to an employment
agreement dated as of May 10, 2001. The agreement provides for Mr. Doyle's
service as President and Chief Executive Officer of both Guaranty and Guaranty
Bank and provides for a base salary of $195,300. In addition, the agreement
provides for, at the beginning of his employment, the grant of options to
purchase 5,000 shares of Common Stock and, in each of February 2002, 2003 and
2004, the grant of options to purchase 10,000 shares of Common Stock. Each
option, which Guaranty granted or will grant under its 1991 Incentive Plan, is
immediately exercisable, has an exercise price of the fair market value at the
date of grant and has an 10-year term. The options are intended to be treated as
incentive stock options.
Under the agreement, if Mr. Doyle's employment is terminated by
Guaranty for reasons other than cause or by Mr. Doyle for "good reason" (as
defined in the agreement), he will be entitled to receive severance pay equal to
one-twelfth of his annual base salary in effect at the time for 36 months or for
the remainder of the term of the agreement, whichever is less. If his employment
terminates for reasons other than cause or for good reason within one year of a
change in control of Guaranty, he will be entitled to severance payments
approximately equal to 299% of his annualized cash compensation for a period
that precedes the change in control as determined under the Internal Revenue
Code of 1986, as amended. If termination of employment due to a change in
control had occurred in the year ended December 31, 2001, Mr. Doyle would have
been entitled to severance payments amounting to approximately $583,947.
The agreement also contains a covenant not to compete that is in effect
while Mr. Doyle is an officer and employee of Guaranty and for a 12-month period
after the termination of his employment. The agreement is for a period ending
May 31, 2006.
Transactions with Management
Some of the directors and officers of Guaranty are at present, as in
the past, customers of Guaranty, and Guaranty has had, and expects to have in
the future, banking transactions in the ordinary course of its business with
directors, officers, principal shareholders and their associates, on
substantially the same terms, including interest rates and collateral on loans,
as those prevailing at the same time for comparable transactions with others.
These transactions do not involve more than the normal risk of collectibility or
present other unfavorable features.
8
There are no legal proceedings to which any director, officer or
principal shareholder, or any affiliate thereof, is a party that would be
material and adverse to Guaranty.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires Guaranty's directors and executive officers, and any
persons who own more than 10% of the outstanding shares of Common Stock, to file
with the Securities and Exchange Commission (the "SEC") reports of ownership and
changes in ownership of Common Stock. Directors and executive officers are
required by SEC regulation to furnish Guaranty with copies of all Section 16(a)
forms that they file. Based solely on review of the copies of such reports
furnished to Guaranty or written representation that no other reports were
required, Guaranty believes that, during fiscal year 2001, all filing
requirements applicable to its directors and executive officers were complied
with, except that the President and Chief Executive Officer inadvertently filed
late a report on Form 3 in March 2002.
INDEPENDENT AUDITORS
Guaranty expects to appoint BDO Seidman, LLP to perform the audit of
Guaranty's financial statements for the year ending December 31, 2002. BDO
Seidman, LLP has acted as Guaranty's auditors for the past seven years and has
reported on financial statements during that period. A representative from BDO
Seidman, LLP is expected to be present at the Meeting, will have the opportunity
to make a statement if he desires to do so, and is expected to be available to
respond to appropriate questions from shareholders.
AUDIT INFORMATION
The Board of Directors has adopted a written charter for the Audit
Committee. The three members of the Audit Committee are independent as that term
is defined in the listing standards of the National Association of Securities
Dealers.
Fees of Independent Public Accountants
Audit Fees
The aggregate amount of fees billed or expected to be billed to
Guaranty by BDO Seidman, LLP for professional services rendered in connection
with the audit of Guaranty's annual financial statements for the fiscal year
ended December 31, 2001, and for the review of Guaranty's interim financial
statements included in Guaranty's Quarterly Reports on Form 10-QSB for that
fiscal year, was $83,800.
Financial Information System Design and Implementation Fees
There were no professional services rendered to Guaranty by BDO
Seidman, LLP for the design and implementation of financial information systems
for the fiscal year ended December 31, 2001.
9
All Other Fees
The aggregate amount of fees billed to Guaranty by BDO Seidman, LLP for
all other non-audit services rendered to Guaranty for the fiscal year ended
December 31, 2001 was $23,200, all of which represent fees for tax and
audit-related services. Audit-related services generally include fees for
pension and statutory audits, business acquisitions, accounting consultations,
internal audits and SEC registration statements. The Audit Committee has
considered whether the independent auditor's provision of non-audit services to
Guaranty is compatible with maintaining the auditor's independence.
Audit Committee Report
Management is responsible for Guaranty's internal controls, financial
reporting process and compliance with laws and regulations and ethical business
standards. The independent auditor is responsible for performing an independent
audit of Guaranty's consolidated financial statements in accordance with
generally accepted auditing standards and issuing a report thereon. The Audit
Committee's responsibility is to monitor and oversee these processes on behalf
of the Board of Directors.
In this context, the Audit Committee has reviewed and discussed the
audited financial statements with management and the independent auditors. The
Audit Committee has discussed with the independent auditors the matters required
to be discussed by Statement on Auditing Standards No. 61 (Communication with
Audit Committees). In addition, the Audit Committee has received from the
independent auditors the written disclosures required by Independence Standards
Board Standard No. 1 (Independence Discussions with Audit Committees) and
discussed with them their independence from Guaranty and its management.
Moreover, the Audit Committee has considered whether the independent auditor's
provision of non-audit services to Guaranty is compatible with maintaining the
auditor's independence.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in Guaranty's Annual Report on Form 10-KSB for the fiscal
year ended December 31, 2001, for filing with the Securities and Exchange
Commission. By recommending to the Board of Directors that the audited financial
statements be so included, the Audit Committee is not opining on the accuracy,
completeness or presentation of the information contained in the audited
financial statements.
Submitted by the Audit Committee of the Board of Directors
John R. Metz, Chairman
Douglas E. Caton
Oscar W. Smith, Jr.
ANNUAL REPORT AND FINANCIAL STATEMENTS
A copy of Guaranty's Annual Report to Shareholders for the year ended
December 31, 2001, has been furnished to shareholders. Additional copies may be
obtained by written request to the Secretary of Guaranty at the address
indicated below. The Annual Report is not part of the proxy solicitation
materials.
10
UPON RECEIPT OF A WRITTEN REQUEST OF ANY PERSON WHO, ON THE RECORD
DATE, WAS RECORD OWNER OF COMMON STOCK OR WHO REPRESENTS IN GOOD FAITH THAT HE
OR SHE WAS ON SUCH DATE THE BENEFICIAL OWNER OF SUCH STOCK ENTITLED TO VOTE AT
THE ANNUAL MEETING OF SHAREHOLDERS, GUARANTY WILL FURNISH TO SUCH PERSON,
WITHOUT CHARGE, A COPY OF ITS ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR
ENDED DECEMBER 31, 2001, AND THE EXHIBITS THERETO REQUIRED TO BE FILED WITH THE
SEC UNDER THE EXCHANGE ACT. ANY SUCH REQUEST SHOULD BE MADE IN WRITING TO ESTHER
S. SHELER, SECRETARY, GUARANTY FINANCIAL CORPORATION, 1658 STATE FARM BOULEVARD,
CHARLOTTESVILLE, VIRGINIA 22911. THE FORM 10-KSB IS NOT PART OF THE PROXY
SOLICITATION MATERIALS.
PROPOSALS FOR 2003 ANNUAL MEETING
Under the regulations of the SEC, any shareholder desiring to make a
proposal to be acted upon at the 2003 annual meeting of shareholders must cause
such proposal to be received, in proper form, at Guaranty's principal executive
offices at 1658 State Farm Boulevard, Charlottesville, Virginia 22911, no later
than November 25, 2002, in order for the proposal to be considered for inclusion
in Guaranty's Proxy Statement for that meeting. It is urged that any such
proposals be sent by certified mail, return receipt requested.
Guaranty's Bylaws also prescribe the procedures that a shareholder must
follow to nominate directors or to bring other business before shareholders'
meetings outside of the proxy statement process. For a shareholder to nominate a
candidate for director at the 2003 annual meeting of shareholders, notice of
nomination must be received by Guaranty's Secretary not less than 60 days and
not more than 90 days prior to the date of the 2003 annual meeting. The notice
must describe various matters regarding the nominee and the shareholder giving
the notice. For a shareholder to bring other business before the 2003 annual
meeting of shareholders, notice must be received by Guaranty's Secretary not
less than 60 days and not more than 90 days prior to the date of the 2003 annual
meeting. The notice must include a description of the proposed business, the
reasons therefor, and other specified matters. Any shareholder may obtain a copy
of Guaranty's Bylaws, without charge, upon written request to Guaranty's
Secretary. Based upon an anticipated date of April 24, 2003 for the 2003 annual
meeting of shareholders, Guaranty must receive any notice of nomination or other
business no earlier than January 24, 2003 and no later than February 25, 2003.
OTHER MATTERS
The Board of Directors is not aware of any matters to be presented for
action at the meeting other than as set forth herein. However, if any other
matters properly come before the Meeting, or any adjournment thereof, the person
or persons voting the proxies will vote them in accordance with their best
judgment.
By Order of The Board of Directors
Esther S. Sheler
Secretary
March 25, 2002
11
PLEASE MARK VOTES REVOCABLE PROXY
|X| AS IN THIS EXAMPLE GUARANTY FINANCIAL CORPORATION
Proxy Solicited on Behalf of The Board of Directors With- For All
For hold Except
The undersigned hereby appoints John R. Metz and James 1. To elect as directors the three _ _ _
R. Sipe, Jr., jointly and severally, proxies, with full persons listed as nominees below. |_| |_| |_|
power to act alone, and with full power of substitution,
to represent the undersigned and to vote, as designated For Terms Expiring in 2005
below and upon any and all other matters that may William E. Doyle, Jr.
properly be brought before such meeting, all shares of Jason I. Eckford, Jr.
Common Stock that the undersigned is entitled to vote at Harry N. Lewis
the Annual Meeting of Shareholders of Guaranty Financial
Corporation, a Virginia corporation, to be held at the INSTRUCTION: To withhold authority to vote for any individual
Glenmore Country Club, 1750 Piper Way, Keswick, Virginia, nominee, mark "For All Except" and write that nominee's name in the
on April 25, 2002, at 10:00 a.m., local time, or any space provided below.
adjournments thereof, for the following purposes:
_____________________________________________________________________
2. In their discretion, the proxies are authorized to vote upon
any other business that may properly come before the meeting,
or any adjournment thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE SHAREHOLDER. IF NO DIRECTION IS GIVEN, THIS
PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN ITEM 1.
If signing as Attorney, Administrator, Executor, Guardian or
Trustee, please add your title as such.
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Please be sure to sign and date | Date |
this Proxy in the box below | |
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| |
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--Shareholder sign above---Co-holder (if any) sign above--
^ Detach above card, sign, date and mail in postage paid envelope provided. ^
GUARANTY FINANCIAL CORPORATION
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| PLEASE ACT PROMPTLY |
| SIGN, DATE & MAIL YOUR PROXY CARD TODAY |
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IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED
BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE PROVIDED.
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