SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
[X] Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 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 the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided in Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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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 May 24,
2001, at 10:00 a.m., at the Glenmore Country Club, 1750 Piper Way, Keswick,
Virginia (the "Meeting"). At the Meeting, two 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/ Douglas E. Caton
Douglas E. Caton
Chairman of the Board
Charlottesville, Virginia
April 24, 2001
GUARANTY FINANCIAL CORPORATION
1658 State Farm Boulevard
Charlottesville, Virginia 22911
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on May 24, 2001
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 May 24, 2001 at 10:00 a.m., for the following
purposes:
1. To elect two 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
April 12, 2001, 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
April 24, 2001
________________________________________________________________________________
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.
________________________________________________________________________________
GUARANTY FINANCIAL CORPORATION
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
May 24, 2001
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 May 24,
2001, at 10:00 a.m., at the Glenmore Country Club, 1750 Piper Way, Keswick,
Virginia, and any adjournment thereof (the "Meeting"). At the Meeting, two
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 April 24, 2001.
The Board of Directors has fixed the close of business on April 12,
2001, 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 1,148 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
453,196 shares of Common Stock, or approximately 22.5% 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 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 not
voting in favor of 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
Two directors are to be elected to serve for terms of three years each.
The Board of Directors acts as a Nominating Committee for selecting the nominees
for election as directors. The Board of Directors has no reason to believe that
any of the nominees will be unavailable.
Under Guaranty's Bylaws, notice of a proposed nomination or a
shareholder proposal meeting certain specified requirements must be received by
Guaranty not less than 60 nor more than 90 days prior to any meeting of
shareholders called for the election of directors, provided in each case that if
fewer than 70 days' notice of the meeting is given to shareholders, such written
notice shall be received not later than the close of the tenth day following the
day on which notice of the meeting was mailed to shareholders. Assuming a date
of May 23, 2002 for the 2002 annual meeting of shareholders, Guaranty must
receive any notice of nomination or other business no earlier than February 22,
2002 and no later than March 24, 2002.
Guaranty's Bylaws require that the shareholder's notice set forth as to
each nominee (i) the name, age, business address and residence address of such
nominee, (ii) the principal occupation or employment of such nominee, (iii) the
class and number of shares of Guaranty that are beneficially owned by such
nominee, and (iv) any other information relating to such nominee that is
required under federal securities laws to be disclosed in solicitations of
proxies for the election of directors, or is otherwise required (including,
without limitation, such nominee's written consent to being named in a proxy
statement as nominee and to serving as a director if elected). Guaranty's Bylaws
further require that the shareholder's notice set forth as to the shareholder
giving the notice (i) the name and address of such shareholder and (ii) the
class and amount of such shareholder's beneficial ownership of Guaranty's
capital stock. If the information supplied by the shareholder is deficient in
any material aspect or if the foregoing procedure is not followed, the chairman
of the annual meeting may determine that such shareholder's nomination should
not be brought before the annual meeting and that such nominee shall not be
eligible for election as a director of Guaranty.
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. Unless otherwise indicated, the business experience and principal
occupations shown for each nominee or incumbent director has extended five or
more years.
2
Nominees for Election
for Terms Expiring in 2004
Henry J. Browne, 68, has been a director since 1976.
Mr. Browne is an architect in private practice with studios in Keswick,
Virginia, and Boca Grande, Florida.
Oscar W. Smith, Jr., 70, has been a director since 1976.
Mr. Smith is President of K-B Management Co. in Charlottesville,
Virginia.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
NOMINEES SET FORTH ABOVE.
Incumbent Directors Serving
for Terms Expiring in 2002
Harry N. Lewis, 73, has been a director and Vice Chairman of Guaranty's Board of
Directors since 1976.
Mr. Lewis has been President of Lewis Insurance Agency, Inc., an
insurance sales company in Charlottesville, Virginia, since July 1952.
Jason I. Eckford, Jr., 71, has been a director since 1999.
Mr. Eckford is President of Eckford Financial Services in
Charlottesville, Virginia.
Incumbent Directors Serving
for Terms Expiring in 2003
Douglas E. Caton, 58, 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 of Management Services Corporation, a real
estate management and development company. A combat veteran of the
Vietnam War, Mr. Caton is a Major General, the highest rank attainable,
in the United States Army Reserve with over 32 years of service.
John R. Metz, 63, has been a director since 1980.
Mr. Metz is a pharmacist at Martha Jefferson Hospital in
Charlottesville, Virginia.
James R. Sipe, Jr., 45, has been a director since 1996.
Mr. Sipe is an associate broker with Prudential Funkhouser &
Associates, a real estate sales company in Harrisonburg, 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 13 meetings in the year
ended December 31, 2000. For the year ended December 31, 2000, each of
Guaranty's directors, except for Mr. Browne, 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.
3
The Board of Directors has a standing Audit Committee and a
Compensation 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 and federal
examiners. The Audit Committee met eight times during the year ended December
31, 2000. Additional information with respect to the Audit Committee is
discussed below under "Audit Information."
The Compensation Committee, which reviews senior management's
performance and compensation, and reviews and sets guidelines for compensation
of all employees, consists of Robert P. Englander, as Chairman, and Messrs.
Browne, Lewis, Metz and Smith. The Compensation Committee met four times during
the year ended December 31, 2000.
Security Ownership of Management
The following table sets forth information as of March 31, 2001,
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 39,437 2.01%
Douglas E. Caton 316,315 16.10%
Jason I. Eckford, Jr. 2,500 *
Robert P. Englander 13,200 *
Harry N. Lewis 8,888 *
John R. Metz 16,882 *
Donna W. Richards 23,100 1.16%
James R. Sipe, Jr. 4,900 *
Oscar W. Smith, Jr. 22,974 1.17%
Rex L. Smith, III 6,050 *
All present executive
officers and directors
as a group (11 Persons) 453,196 22.53%
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* Percentage of ownership is less than one percent of the outstanding shares
of Common Stock.
(1) Includes beneficial ownership of shares issuable upon the exercise of stock
options exercisable within 60 days of March 31, 2001.
4
Security Ownership of Certain Beneficial Owners
The following table sets forth information as of March 31, 2001,
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 316,315 16.10%
4 Deer Park
Earlysville, Virginia
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(1) Includes beneficial ownership of shares issuable upon the exercise of stock
options exercisable within 60 days of March 31, 2001.
Executive Officers Who Are Not Directors
Thomas F. Crump, 44, 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.
Donna W. Richards, 36, has been Senior Vice President and Chief
Operating Officer since December 2000. From April 1995 to December 2000, she was
Senior Vice President of Real Estate Lending.
Richard L. Saunders, 47, 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 is currently acting as Guaranty's Chief
Executive Officer.
5
Executive Compensation
Summary of Cash and Certain Other Compensation
The following table shows, for the fiscal years ended December 31,
2000, 1999 and 1998, 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)
------------------ ---- ---------- --------- ---------------- ------- -------------------
Thomas P. Baker 2000 157,506 -- * -- 3,938
Former President and 1999 147,500 -- * 15,000 3,750
Chief Executive Officer 1998 122,600 3,000 * -- 2,930
(2)
Rex L. Smith, III 2000 (3) 121,862 -- * -- 3,124
Former Senior Vice 1999 137,500 -- * 22,500 3,032
President -- Retail / 1998 (4) 96,250 3,000 * -- --
Commercial
Donna W. Richards 2000 136,505 -- * -- 3,413
Senior Vice President and 1999 125,833 20,000 (5) * 22,500 3,203
Chief Operating Officer 1998 87,500 3,000 * -- 2,297
-----------------
* All benefits that might be considered of a personal nature did not exceed
the lesser of $50,000 or 10% of total annual salary and bonus.
(1) Amounts reflect Guaranty's matching contribution under its Section 401(k)
retirement plan.
(2) Mr. Baker's employment with Guaranty terminated in March 2001.
(3) Mr. Smith's employment with Guaranty terminated in September 2000.
(4) Mr. Smith's employment with Guaranty began in February 1998, and the
amounts shown include all compensation paid to Mr. Smith from February 1998
to December 1998.
(5) In February 1999, Ms. Richards was paid a one-time signing bonus in
connection with her entering into an employment agreement with Guaranty.
6
Stock Option Grants
In the year ended December 31, 2000, no stock options were granted to
any of the named Executive Officers.
Option Exercises and Holdings
In the year ended December 31, 2000, no stock options were exercised by
any of the named Executive Officers. The following table sets forth the amount
and value of stock options held by the named Executive Officers as of December
31, 2000.
Fiscal Year-End Option Values
Number of
Securities Underlying Value of Unexercised
Unexercised Options at In-the-Money Options
Fiscal Year End (#) (1) at Fiscal Year End ($) (2)
----------------------- --------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
Thomas P. Baker 10,000 (3) -- -- --
Donna W. Richards 22,500 -- -- --
------------------
(1) Each of these options relates to shares of Common Stock.
(2) No options disclosed in the table were in-the-money as of December 31,
2000.
(3) All of the options held by Mr. Baker expired when his employment with
Guaranty terminated in March 2001.
Directors' Fees
Directors, excluding directors who are officers of Guaranty, received
fees of $550 for each meeting of the Board of Directors attended and $300 for
each Loan, Audit, Compensation and Building Committee meeting attended during
fiscal 2000. 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, 2000,
in lieu of any fees for attending Board of Directors and Committee meetings.
In 1998, each director of Guaranty was granted 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 were granted with an exercise price at or above the fair market
value of the Common Stock.
Employment Agreements
Guaranty and Donna W. Richards are parties to an employment agreement
entered into in February 1999. The employment agreement provides for her to
serve in a senior management or executive capacity and provides for a base
salary of $130,000. The agreement is for a period ending February 26, 2004. If
she is terminated for reasons other than cause, she will be entitled to receive
severance pay equal to her annual base salary in effect at the time. If her
employment terminates for any reason within 120 days of a change in control, she
will be entitled to severance payments approximately equal to 299% of her
average cash compensation for the five years that precede the change in control.
If
7
termination of employment due to a change in control had occurred in the year
ended December 31, 2000, Ms. Richards would have been entitled to severance
payments amounting to approximately $408,135.
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.
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 Common Stock, to file with the SEC reports of
ownership and changes in ownership of Common Stock. Officers and directors 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 2000, all filing
requirements applicable to its officers and directors were complied with, except
that Thomas F. Crump inadvertently filed late a Form 3, Jason I. Eckford, Jr.
inadvertently filed late a Form 4 with respect to four purchases of common stock
from February 1999 to November 2000 and John R. Metz inadvertently filed late a
Form 4 with respect to four purchases of common stock from February 2000 to
August 2000.
INDEPENDENT AUDITORS
BDO Seidman, LLP has been appointed to perform the audit of Guaranty's
financial statements for the year ending December 31, 2001. 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.
AUDIT INFORMATION
The Board of Directors has adopted a written charter for the Audit
Committee that is set forth in Exhibit A to this Proxy Statement. 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
8
for the fiscal year ended December 31, 2000, 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 $98,375.
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, 2000.
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, 2000 was $22,000, 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.
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 information technology services and other 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, 2000, 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.
9
ANNUAL REPORT AND FINANCIAL STATEMENTS
A copy of Guaranty's Annual Report to Shareholders for the year ended
December 31, 2000, 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.
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, 2000, 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 2002 ANNUAL MEETING
Under the regulations of the SEC, any shareholder desiring to make a
proposal to be acted upon at the 2002 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 December 25, 2001, 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. For more information on these procedures, see "Election of Directors."
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
/s/ Esther S. Sheler
Esther S. Sheler
Secretary
April 24, 2001
10
Exhibit A
GUARANTY FINANCIAL CORPORATION
AUDIT COMMITTEE CHARTER
Organization
------------
The Audit Committee shall be appointed by the Board of Directors and shall
consist of at least three directors, all of whom are independent of management
and of the Company. Members of the Audit Committee shall be considered
independent if they have no relationship to the Company that may interfere with
the exercise of their independence from management and from the Company. All
Audit Committee members shall be financially literate, or shall become
financially literate within a reasonable period of time after appointment to the
Audit Committee, and at least one member shall have accounting or related
financial management expertise.
Statement of Policy
-------------------
The Audit Committee shall assist the Board of Directors in fulfilling the
Board's oversight responsibility to the stockholders relating to (A) the
Company's financial reporting process, systems of internal accounting and
financial controls, and internal audit function and (B) the annual independent
audit of the Company's financial statements. In so doing, the Audit Committee
will benefit from free and open communication between the Audit Committee, the
directors, the independent accountants, the internal auditor, and the financial
management of the Company. The Audit Committee may adopt such policies and
procedures as it may deem necessary or appropriate to carry out its
responsibilities under this charter. The Audit Committee's policies and
procedures should be flexible in order to best react to changing conditions and
circumstances.
Processes
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The following shall be the recurring processes of the Audit Committee in
carrying out its oversight function. The Audit Committee may supplement these
processes as appropriate.
o The Audit Committee shall review and reassess the Audit Committee's charter
at least annually and the charter shall be approved by the Board of
Directors. The Company shall include a copy of the charter in its proxy
statement at least triennially or the year after any significant amendment
to the charter and shall disclose in all proxy statements whether Audit
Committee members are independent. Approximately once each year and, with
respect to any changes in the composition of the Audit Committee, the
Company must provide The Nasdaq Stock Market, Inc.SM written confirmation
regarding the Board's determination of Audit Committee members'
independence, the financial literacy of Audit Committee members, the
determination that at least one member of the Audit Committee has
accounting or related financial management expertise, and the annual review
and reassessment of the adequacy of the charter.
o The Audit Committee shall have a clear understanding with management and
the independent accountants that the independent accountants are ultimately
accountable to the Board and to the Audit Committee, both of which are
representatives of the Company's stockholders. The Audit Committee and the
Board shall have the ultimate authority and responsibility to engage,
evaluate, and, where appropriate, replace the independent accountants. The
Audit Committee shall discuss with the accountants their independence from
management and from the Company and shall discuss all relationships between
the accountants and their related entities and the Company and its related
entities that may reasonably be thought to bear on the accountants'
independence. The independent
accountants shall confirm that, in their view, they are independent of the
Company. In this regard, the Audit Committee shall obtain a formal written
statement from the independent accountants delineating all relationships
between the accountants and the Company and shall, when necessary,
recommend that the Board take any appropriate action to satisfy itself of
the accountants' independence.
o The Audit Committee shall discuss with the internal auditor and the
independent accountants the overall scope and plans for their respective
audits. Also, the Audit Committee shall discuss with management, the
internal auditor, and the independent accountants the adequacy and
effectiveness of the accounting and financial controls and may elicit any
recommendations for the improvement of such internal controls or particular
areas where new or more detailed controls or procedures are desirable.
Further, the Audit Committee shall meet separately with the internal
auditor and the independent accountants, with and without management
present, to discuss the results of its examinations.
o The Audit Committee shall review interim financial statements with
management and the independent accountants prior to the filing of the
Company's Quarterly Report on Form 10-QSB. The Audit Committee shall
discuss the results of the quarterly review and any other matters required
under generally accepted auditing standards to be communicated to the Audit
Committee by the independent accountants. The chairperson of the Audit
Committee may represent the entire Audit Committee for the purposes of this
review.
o The Audit Committee shall review with management and the independent
accountants the financial statements to be included in the Company's Annual
Report on Form 10-KSB (or the annual report to stockholders if distributed
prior to the filing of the Form 10-KSB). The independent accountants shall
provide their judgment about the quality, not merely the acceptability, of
accounting principles, the reasonableness of any significant judgments, and
the clarity of disclosures in the financial statements as part of such
review. The Audit Committee shall also discuss the results of the annual
audit and any other matters required under generally accepted auditing
standards to be communicated to the Audit Committee by the independent
accountants.
o In discharging its role, the Audit Committee is free to consider an
investigation into any matter brought to its attention and shall have both
full access to all books, records, facilities, and personnel of the Company
and the power to retain outside counsel or other experts for this purpose
if, in its judgment, that is appropriate, without obtaining the prior
permission of the Board of Directors.
This charter shall not be construed in a manner that imposes upon the Audit
Committee a higher standard of care than that imposed upon committees of boards
of directors generally, pursuant to applicable law. It is not the duty of the
Audit Committee to plan or conduct audits or to determine that the Company's
financial statements are complete or accurate or are in accordance with
generally accepted accounting principles. These are the collective
responsibilities of management and the independent accountants. Nor is it the
duty of the Audit Committee to resolve disagreements, if any, between management
and the independent accountants or to assure compliance with laws or regulations
or the Company's audit policies and programs.
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 two _ _ _
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 2004
below and upon any and all other matters that may Henry J. Browne
properly be brought before such meeting, all shares of Oscar W. Smith, Jr.
Common Stock that the undersigned is entitled to vote at
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 May 24, 2001, 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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| |
| |
--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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