UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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COLONY BANKCORP, INC.
(Name of Registrant as Specified in Its Charter)
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COLONY BANKCORP, INC.INC.
Post Office Box 989989
115 South Grant StreetStreet
Fitzgerald, Georgia 3175031750
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
May 25, 2010
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD
May 26, 2009
This proxy statement is furnished to the shareholders of Colony Bankcorp, Inc. in connection with the solicitation of proxies by its Board of Directors to be voted at the 20092010 Annual Meeting of Shareholders and at any adjournments thereof (the "Annual Meeting"“Annual Meeting”). The Annual Meeting will be held on Tuesday, May 26, 2009,25, 2010, at Colony Bankcorp, Inc. Corporate Offices at 115 South Grant Street, Fitzgerald, Georgia, at 2:00 p.m. local time.
The approximate date on which this proxy statement and the accompanying proxy card are first being sent or given to shareholders is April 24, 2009.23, 2010.
As used in this proxy statement, the terms Colony Bankcorp, Company, Colony, we, our and us all refer to Colony Bankcorp, Inc. and its subsidiaries.
Notice Regarding The Internet Availability Of Proxy Materials
We have posted materials related to the 20092010 annual meeting on the Internet. The following materials are available on the Internet at http://materials.proxyvote.com/19623P:
| | ·§ | This proxy statement for the 20092010 annual meeting, |
| | ·§ | Colony’s 20092010 annual report to shareholders, and |
| | ·§ | Colony’s annual report on Form 10-K filed with the Securities and Exchange CommissionCommission. |
VOTING
General
The securities which can be voted at the Annual Meeting consist of Colony Bankcorp'sBankcorp’s $1.00 par value common stock ("(“Colony Bankcorp stock"stock”), with each share entitling its owner to one vote on each matter submitted to the shareholders. The record date for determining the holders of Colony Bankcorp stock who are entitled to notice of and to vote at the Annual Meeting is April 15, 2009.2010. On the record date, 7,231,1638,445,208 shares of Colony Bankcorp stock were outstanding and eligible to be voted.
Quorum and Vote Required
The presence, in person or by proxy, of a majority of the outstanding shares of Colony Bankcorp stock is necessary to constitute a quorum at the Annual Meeting. In determining whether a quorum exists at the Annual Meeting for purposes of all matters to be voted on, all votes "for"“for” or "against"“against” as well as all abstentions (including votes to withhold authority to vote) will be counted.
In voting for the proposal to elect eleven directors (Proposal No. 1), you may vote in favor of all nominees or withhold your votes as to all or as to specific nominees. The vote required to approve Proposal No. 1 is governed by Georgia law and is a plurality of the votes cast by the holders of shares entitled to vote, provided a quorum is present. Any other matter which may be submitted to shareholders at the meeting will be determined by a majority of the votes cast at the meeting. Votes withheld and broker non-votes will not be counted and will have no effect.
In voting on the proposal to approve the advisory (non-binding) vote on executive compensation (Proposal No. 2), you may vote for or against the proposal or abstain. The proposal will be deemed approved if a majority of the votes cast at the meeting are voted for Proposal No.2.No. 2. The vote is advisory, and will not be binding upon the directors.
OurAs of March 31, 2010 our directors and executive officers hold 1,023,696held 1,514,353 shares of Colony Bankcorp stock, or approximately 14.16%17.93% of all outstanding stock, and we believe that all of those shares will be voted in favor of the proposal.
Proxies
All properly executed proxy cards delivered pursuant to this solicitation and not revoked will be voted at the Annual Meeting in accordance with the directions given. In voting by proxy with regard to the election of directors, you may vote in favor of all nominees, withhold your votes as to all nominees or withhold your votes as to specific nominees. You should specify your choices on the proxy card. If no specific instructions are given with regard to the matters to be voted upon, the shares represented by a signed proxy card will be voted "for"“for” the proposals listed on the proxy card. If any other matters properly come before the Annual Meeting, the persons named as proxies willw ill vote upon such matters according to their judgment.
All proxy cards delivered pursuant to this solicitation are revocable at any time before they are voted by giving written notice to our Secretary, Terry L. Hester, at 115 South Grant Street, Fitzgerald, Georgia 31750, by delivering a later dated proxy card, or by voting in person at the Annual Meeting.
All expenses incurred in connection with the solicitation of proxies will be paid by us. Solicitation may take place by mail, telephone, telegram, or personal contact by our directors, officers, and regular employees of the Company without additional compensation. The Annual Report of the Company for the year 2008,2009, which includes the Audited Consolidated Financial Statements and accompanying Notes and Managements’ Discussion and Analysis of Financial Condition and Results of Operations, accompanies this proxy statement.
BUSINESS OF THE COMPANY
Colony Bankcorp, Inc. (the “Company”) is a Georgia business corporation which was incorporatedincorporated on November 8, 1982. The Company was organized for the purpose of operating as a bank-holding company under the Federal Bank-Holding Company Act of 1956, as amended, and the bank-holding company laws of Georgia. On July 22, 1983, the Company, after obtaining the requisite regulatory approvals,approvals, acquired 100 percent of the issued and outstanding common stock of Colony Bank (formerly The Bank of Fitzgerald and Colony Bank of Fitzgerald), Fitzgerald, Georgia, through the merger of the Bank with a subsidiary of the Company which was created for the purpose of organizing the Bank into a one-bank holding company. Since that time, Colony Bank has operated as a wholly-owned subsidiary of the Company. The Company effected a merger of its subsidiary banks on August 1, 2008 in tointo one surviving subsidiary bank, Colony Bank, while at the same time changing the name of the subsidiary bank, Colony Bank of Fitzgerald, to Colony Bank.
On April 30, 1984, the Company acquired 100 percent of the issued and outstanding common stock of Colony Bank Wilcox (formerly Pitts Banking Company and Community Bank of Wilcox), Pitts, Wilcox County, Georgia in an all stock transaction. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank Wilcox was merged into Colony Bank effective August 1, 2008.
On November 1, 1984, the Company acquired 100 percent of the issued and outstanding commoncommon stock of Colony Bank Ashburn (formerly Ashburn Bank), Ashburn, Turner County, Georgia for a combination of cash and interest-bearing promissory notes. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank Ashburn was merged into Colony Bank effective August 1, 2008.
On September 30, 1985, the Company acquired 100 percent of the issued and outstanding common stock of Colony Bank of Dodge County (formerly The Bank of Dodge County), Eastman, Dodge County, Georgia in an all stock transaction. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank of Dodge County was merged into Colony Bank effective August 1, 2008.
On July 31, 1991, the Company acquired 100 percent of the issued and outstanding common stock of Colony Bank Worth (formerly Worth Federal Savings and Loan Association and Bank of Worth), Sylvester, Worth County, Georgia in a cash and stock transaction. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank Worth was merged into Colony Bank effective August 1, 2008.
On November 8, 1996, the Company organized Colony Management Services, Inc. to provide support services to each subsidiary. Services include loan and compliance review, internal auditing and data processing. Colony Management Services, Inc. operated as a wholly-owned subsidiary of the Company until Colony Management Services, Inc. was merged into Colony Bank effective August 1, 2008.
On November 30, 1996, the Company acquired 100 percent of Colony Bank Southeast (formerly Broxton State Bank), Broxton, Coffee County, Georgia in an all stock transaction. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank SoutheastSoutheast was merged into Colony Bank effective August 1, 2008.
On March 2, 2000, Colony Bank Ashburn purchased the capital stock of Colony Mortgage Corp (formerly Georgia First Mortgage Company) in a business combination accounted for as a purchase. Colony Mortgage Corp is primarily engaged in residential real estate mortgage lending in the state of Georgia. Colony Mortgage Corp operates as a subsidiary of Colony Bank effective with the August 1, 2008 merger.
On March 29, 2002, the Company acquired 100 percent of Colony Bank Quitman, FSB (formerly Quitman Federal Savings Bank), Quitman, Brooks County, Georgia in a cash and stock transaction. Since the date of acquisition, the Bank operated as a wholly-owned subsidiary of the Company until Colony Bank Quitman, FSB was merged into Colony Bank effective August 1, 2008.
On March 19, 2004, Colony Bank Ashburn purchased Flag Bank -Thomaston– Thomaston Office in a business combination accounted for as a purchase. Since the date of acquisition, the Thomaston office operated as a branch office of Colony Bank Ashburn until August 1, 2008 when it became a branch office of Colony Bank.
On June 17, 2004, Colony formed Colony Bankcorp Statutory Trust III for the purpose of establishingestablishing a special purpose entity to issue trust preferred securities.
On April 13, 2006, Colony formed Colony Bankcorp Capital Trust I for the purpose of establishingestablishing a special purpose entity to issue trust preferred securities.
On March 12, 2007, Colony formed Colony Bankcorp Capital Trust II for the purpose of establishingestablishing a special purpose entity to issue trust preferred securities. Proceeds from this Trust were used to pay off trust preferred securities issued on March 26, 2002 through Colony Bankcorp Statutory Trust I.
On September 14, 2007, Colony formed Colony Bankcorp Capital Trust III for the purpose of establishing a special purpose entity to issue trust preferred securities. Proceeds from this Trust were used to pay off trust preferred securities issued on December 19, 2002 through Colony Bankcorp Statutory Trust II.
Colony Bankcorp, Inc. is a bank holding company headquartered in Fitzgerald, Georgia that consists of one operating subsidiary, Colony Bank. The Company conducts a general full service commercial, consumer and mortgage borrowing business through thirty offices located in the middle and south Georgia cities of Albany, Ashburn, Broxton, Centerville, Chester, Columbus, Cordele, Douglas, Eastman, Fitzgerald, Leesburg, Moultrie, Pitts, Quitman, Rochelle, Savannah, Soperton, Sylvester, Thomaston, Tifton, Valdosta and Warner Robins.
Because Colony Bankcorp, Inc. is a bank-holding company, its principal operations are conductedconducted through its subsidiary bank. It has 100% ownership of its subsidiary and maintains systems of financial, operational and administrative controls that permit centralized evaluation of the operations of the subsidiary bank in selected functional areas including operations, accounting, marketing, investment management,management, purchasing, human resources, computer services, auditing, compliance and credit review.
Responsibility for management of the bank remains with its respective Board of Directors and officers. Services rendered by the Company are intended to assist bank management and to expand the scope of available banking services.
Colony Bankcorp, Inc. common stock is quoted on the NASDAQ National Market under the symbol “CBAN”.
Colony Bankcorp, Inc. common stock is quoted on the NASDAQ Global Market under the symbol “CBAN”.
EMPLOYEES
As of December 31, 2008,2009, Colony Bankcorp, Inc. and its subsidiaries employed 295286 fulltime employees and 2821 part-time employees.
Proposal No. 1
Election of Directors
Our Board of Directors consists of eleven members, nine of whom are non-employee directors. The Company'sCompany’s bylaws provide that the Board of Directors shall consist of not less than three nor more than twenty-five persons, with the exact number to be fixed and determined from time to time by resolution of the Board of Directors, or by resolution of the shareholders at any annual or special meeting of share-holders.shareholders.
The Board of Directors has voted that the Board consist of eleven members for the Company'sCompany’s ensuing fiscal year.
The Nomination Committee, consisting of independent directors Terry Coleman, Morris Downing, Dan Minix and Jerry Harrell, recommended to the full Board a slate of directors for consideration in the shareholders proxy for the Annual Meeting. The Board of Directors, based on the Nomination Committee recommendations, has nominated the following persons for submission to the shareholders for election for a one- yearone-year term expiring at the 20102011 annual meeting:
| Terry L. Coleman | | Charles E. Myler |
| L. Morris Downing, Jr. | | W. B.W.B. Roberts, Jr. |
| Edward J. Harrell | | Al D. Ross |
| Terry L. Hester | | Jonathan W.R. Ross |
| Mark H. Massee | | B. Gene Waldron |
Each of the nominees is currently a director.
The Board of Directors recommends that you vote "FOR"“FOR” the proposal to elect the eleven nominees names above.
Each of the nominees has consented to serve if elected. If any nominee should be unavailable to serve for any reason, the Board may designate a substitute nominee (in which event the persons named as proxies will vote the shares represented by all valid proxy cards for the election of such substitute nominee)nominee), allow the vacancy to remain open until a suitable candidate is located, or reduce the number of directors.
Information as of December 31, 20082009 about each of the nominees is set forth below. Their ownership of Colony Bankcorp stock is set forth in the table on page twelve.thirteen.
Directors and Nominees
Terry L. ColemanColeman. . Mr. Coleman, age 65,66, is the Ownerowner of Huddle House restaurants in McRae and Eastman, Georgia.Georgia, which he has operated since the mid-eighties. He presently serves as Deputy Commissioner of Georgia Department of Agriculture, a position held the past three years and formerly served as a membermember of the State of Georgia House of Representatives and Speaker of the House of Representatives. Mr. Coleman serveshas served as a Director of Colony Bank.Bank since the Company merger in August 2008. He previously served as a Director of the Colony Bank of Dodge County charter until the merger in 2008 and presently serves as an advisory board member of Colony Bank Dodge office since 2008. Mr. Coleman has been a Director of Colony Bankcorp since May 1990.
The Board of Directors believes that Mr. Coleman’s business experience makes him an excellent candidate for Director of the Company.
L. Morris Downing, JrJr. . Mr. Downing, age 66,67, is President of Lowell Packing Company.Company in Fitzgerald, Georgia. He operated this meat processing company from 1968 – 2005. For the past fifteen years Mr. Downing has also servesserved as a trustee for a self-insured insurance trust fund. Mr. Downing has served as a Director of Colony Bank.Bank since the Company merger in August 2008. Mr. Downing has been a Director of Colony Bankcorp since July 1994 and has served as Chairman of the Board since May 2002.
The Board of Directors believes that Mr. Downing’s experience in business, management and insurance makes him an excellent candidate for Director of the Company.
Terry L. Hester. Mr. Hester, age 54,55, has been Executive Vice President and Chief Financial Officer of Colony Bankcorp since June 1994 and Secretary of Colony Bankcorp since May 2003. He also served as Acting President and Chief Executive Officer from June 1993 to June 1994 and has served as Treasurer since 1982. Mr. Hester has served as a Director of Colony Bank since the Company merger in August 2008. He previously served as a Director of Colony Bank Wilcox and Quitman charters until the merger in 2008 and presently serves as an advisory board member of Colony Bank Wilcox and Quitman offices since 2008. He also serves as a Director of Colony BankMortgage Corp and Colony Mortgage Corp. Mr. Hester has been a DirectorDirect or of Colony Bankcorp since March 1990.
The Board of Directors believes that Mr. Hester’s experience as an accountant and his experience in the banking industry makes him an excellent candidate for Director of the Company.
Edward J. HarrellHarrell. . Mr. Harrell, age 64,65, is a Partner of the Macon law firm, Martin Snow, LLP. He also servesLLP where he has been affiliated the past forty-one years. Mr. Harrell has served as a Director of Colony Bank.Bank since the Company merger in August 2008. Mr. Harrell has been a Director of Colony Bankcorp since December 2002 and has served as Vice Chairman of the Board since May 2008.
The Board of Directors believes that Mr. Harrell’s legal expertise and his experience in the banking industry makes him an excellent candidate for Director of the Company.
Mark H. Massee. Mr. Massee, age 55,56, is President of Massee Builders, Inc. This commercial building construction firm has operated since 1978, of which, Mr. Massee has been affiliated the past thirty-two years. He also serveshas served as a Director of Colony Bank.Bank since 1996. Mr. Massee has been a Director of Colony Bankcorp since February 2007.
The Board of Directors believes that Mr. Massee’s experience in commercial real estate and management makes him an excellent candidate for Director of the Company.
James D. MinixMinix. . Mr. Minix, age 67,68, served as Chief Executive Officer of the Company from December 2004 until his retirement in January 2006 and served as President and Chief Executive Officer of the Company from June 1994 to December 2004. Mr. MinixHe served as President and Chief Executive Officer of Colony Bank of Fitzgerald from January 1993 to June 1994. He also served1994 and as President and Chief Executive Officer of Colony Bank Ashburn from February 1990 to December 1992. He has served as a Director of Colony Bank since the Company merger in August 2008. Mr. Minix has been a Director of Colony Bankcorp since March 1994 and served as Vice Chairman of the Board from May 2006 to May 2008.
The Board of Directors believes that Mr. Minix’s extensive experience in the banking industry and at the Bank and the Company makes him an excellent candidate for Director of the Company.
Charles E. MylerMyler. . Mr. Myler, age 66,67, is retired from the FDIC where he served for twenty years as a supervisor of the Albany FDIC office and worked another sixteen years as an FDIC field examiner. He has served the past eight years as a Trainer for the State of Alabama Banking Department. Mr. Myler serveshas served as a Director of Colony Bank.Bank since the Company merger in August 2008. He previously served as a Director of the Colony Bank Ashburn charter until the merger in 2008 and presently serves as an advisory board member of the Colony Bank Ashburn office since 2008. Mr. Myler has been a Director of Colony Bankcorp since October 2004.
The Board of Directors believes that Mr. Myler’s experience as a federal banking regulator supervisor and examiner makes him an excellent candidate for Director of the Company.
W. B.W.B. Roberts, JrJr. . Mr. Roberts, age 67, is68, has been a Farmer and a Businessman. He also servesBusinessman the past fifty years. Mr. Roberts has served as a Director of Colony Bank.Bank since the Company merger in August 2008. He previously served as a Director and Chairman of the Board of the Colony Bank Ashburn charter until the merger in 2008 and presently serves as an advisory board chairman of Colony Bank Ashburn office since 2008. Mr. Roberts has been a Director of Colony Bankcorp since March 1990.
6The Board of Directors believes that Mr. Roberts’ business and farming experience makes him an excellent candidate for Director of the Company.
Al D. RossRoss. . Mr. Ross, age 45,46, has served as President and Chief Executive Officer of the Company since January 2006, served as President and Chief Operating Officer of the Company from December 2004 to January 2006, served as Executive Vice President of the Company from January 2003 to December 2004 and served as Senior Vice President of the Company from May 2002 to January 2003. He also served as President and Chief Executive Officer of Colony Bank Southeast from May 2001 to January 2006. Mr. Ross serveshas served as a Director of Colony Bank since 2004 and previously served as a Director at Colony Bank Southeast, Ashburn, Worth and Quitman charters until the Company merger in August 2008. He presently serves as an advisory board member of Colony Bank Douglas, Sylvester, Ashburn and Quitman offices since 2008. Mr. Ross serves as Chairman of Colony Mortgage Corp. Mr. RossCorp and has been a Director of Colony Bankcorp since January 2005.
The Board of Directors believes that Mr. Ross’ experience in the banking industry and at the Bank and the Company makes him an excellent candidate for Director of the Company.
Jonathan W.R. Ross. Mr. Ross, age 45,46, is President of Ross Construction Company. He also servesCompany, a heavy highway commercial construction company that Mr. Ross has operated the past nine years. Mr. Ross has served as a Director of Colony Bank.Bank since the Company merger in August 2008. He previously served as a Director of the Colony Bank Worth charter until the merger in 2008 and presently serves as an advisory board member of Colony Bank Sylvester office since 2008. Mr. Ross has been a Director of Colony Bankcorp since May 2007.
The Board of Directors believes that Mr. Ross’ business and management experience makes him an excellent candidate for Director of the Company.
B. Gene Waldron. Mr. Waldron, age 49,50, is the Owner of Deep South Farm Center, LLC, President of Tri-County Gin, Inc., President of Deep South Peanut, Inc., and President of Waldron Enterprises, Inc. and Vice President ofHe has been involved in agri-business the past thirty years. Mr. Waldron Farm Service, Inc. He also serveshas served as a Director of Colony Bank.Bank since the company merger in August 2008. He previously served as a Director and Chairman of the Board of the Colony Bank Southeast charter until the merger in 2008 and presently serves as an advisory board chairman of Colony Bank Douglas office since 2008. Mr. Waldron has been a Director of Colony Bankcorp since April 2002.
The Board of Directors believes that Mr. Waldron’s agri-business experience makes him an excellent candidate for Director of the Company.
Each director serves until the Annual Meeting following his election or until such later time as his successor is elected and qualifies or there is a decrease in the number of directors.
Executive Officers
Al D. Ross, Terry L. Hester, Walter P. Patten, Larry E. Stevenson, Henry F. Brown, Jr. and G. Edward Smith IIISteve Wood were the named executive officers of Colony Bankcorp, Inc. during 2008.2009. Messrs. Ross and Hester were previously reported on as nominees for election as directors.
Messrs. Patten and Smith serve as City President and Regional Executive Officer, respectively, while Mr. Brown serveshas served as Senior Credit Administrator and Regional Credit Officer since the Company merger in August 2008. He served as Vice President from 2002 – 2008 overseeing loan review administration and has been employed with the Company since 1996. Mr. Stevenson servesWood served as Regional Credit Officer.MSA Group Executive Officer from August 2008 until his resignation in June 2009. Mr. Wood previously served as President and CEO of two community banks from 1992 until the mid-2000’s. Messrs. Patten, Smith, Brown and StevensonWood were employees during 2008.2009. Pursuant to Securities and Exchange Commission executive compensation disclosure requirements, Messrs. Ross, Hester, Brown Patten and StevensonWood are included in the Company’s 20082009 Summary Compensation Table.
Executive officers do not hold office for a fixed term but maybemay be removed by the Board of Directors with orour without cause. The Company does not have any employment or change-in-control agreements with any of the named executive officers.
Governance of the Company
Our Board of Directors believes that the purpose of corporate governance is to ensure that shareholder value is maximized in a manner consistent with legal requirements and the highest standards of integrity. Colony Bankcorp, through its Board of Directors and management, has long sought to meet the highest standards of corporate governance. The Board has adopted and adheres to corporate governance guidelines which the Board and senior management believe promotes this purpose, are sound and represent best practices. We continually review these governance practices, Georgia law (the state in which we are incorporated), the rules and listing standards of the NASDAQ Stock Market, and the Securities and Exchange Commission (“SEC”) regulations, as well as best practices suggested by recognized governance authorities.
Currently, our Board of Directors has eleven members, nine of whom meet the NASDAQ standard for independence. Only independent directors serve on our Audit Committee, Governance Committee, Compensation Committee and Nomination Committee.
In May 2008,June 2009, the Board of Directors reappointedre-appointed L. Morris Dowing,Downing, Jr. as Chairman, a position Mr. Downing has held since May 2002. In this capacity, Mr. Downing has frequent contact with Mr. Ross and other members of management on a broad range of matters and has additional corporate governance responsibilities for the Board. The Board of Directors has determined that Mr. Downing meets the rules of NASDAQ standard for independence.
In assessing potential directors for our Board, we look for candidates who possess a wide range of experience, skills, areas of expertise, knowledge and business judgement.judgment. A director candidate should also have demonstrated superior performance or accomplishments in his or her professional undertakings.
Our Board of Directors conducts regular meetings, generally on a monthly basis, and also conductsconducts some of its business through the six committees described below. Our Board of Directors met thirteentwelve times during the year and each director attended at least 75% of the meetings of the full Board and of the committee or committees on which he serves.
Leadership Structure of the Board
In accordance with the Company’s Bylaws, the Board of Directors elects our Chief Executive Officer and our Chairman, and each of these positions may be held by the same person or may be held by two persons. Currently, L. Morris Downing, Jr. serves as the Company’s Chairman and Al D. Ross serves as both Chief Executive Officer of the Company and the Bank and President of the Company and the Bank. The Board of Directors believes that separating the Chairman and Chief Executive Officer roles fosters clear accountability, effective decision-making, and alignment on corporate strategy and provides an effective leadership model for the Company. In light of the active involvement by all independent directors, the Board of Directors has not specified a lead independent director at this time. The Board of Directors believes that the current structure of the Board of Directors is appropriate to effectively manage the affairs of the Company and the best interests of the Company’s stockholders.
Board’s Role in Risk Oversight
The Board of Directors is actively involved in oversight of risks that could affect the Company and the Bank. This oversight is conducted primarily through committees of the Board, as disclosed in the descriptions of each of the committees below, but the full Board has retained responsibility through full reports by each committee chair regarding the committee’s considerations and actions, as well as through regular reports directly from officers responsible for oversight of particular risks within the Company and the Bank.
Committees of the Board of Directors
The Executive Committee is appointed by the Chairman of the Board of Directors of the Company, subject to election by the full Board. The purpose of the Executive Committee is to conduct necessary business and make decisions on behalf of the full Board between regular Board meetings. Mr. Harrell, Mr. Minix, Mr. Coleman, Mr. Downing and Mr. A. Ross were members of this committee during the year. The committee met seven times during the year.
The Compensation Committee is appointed by the Chairman of the Board of Directors of the Company, subject to election by the full Board. The purpose of the Compensation Committee is to ensure that the Chief Executive Officer, other executive officers and key management of the Company are compensated effectively in a manner consistent with the compensation strategy of the Company, internal equity considerations, competitive practice, and any requirements of appropriate regulatory bodies, to establish guidelines and oversee the administration of executive compensation plans and arrangements as well as certain employee benefit plans and to recommend any changes to the Director'sDirector’s compensation package. Mr. Downing, Mr. Harrell, Mr. Coleman, Mr. Minix, and Mr. WaldronWaldr on were members of this committee during the year. As of December 31, 2008,2009, the members of the Compensation CommitteCommittee met the independence requirements of the Company'sCompany’s Corporate Governance Guidelines and the rules of NASDAQ. The committee met two times during the year. The Compensation Committee operates under the Corporate Governance Charter which was provided in the 2008 Proxy Statement as Exhibit B. The Charter was not amended in 2008.
The Governance Committee is appointed by the Chairman of the Board of Directors of the Company, subject to election by the full Board. The purpose of the Governance Committee is to take a leadership role in shaping the corporate governance of the Company, to develop and recommend to the Board a set of corporate governance guidelines and to address committee structure and operations. Mr. Harrell, Mr. Coleman, Mr. Minix, and Mr. Downing were members of this committee during the year. As of December 31, 20082009 the members of the Governance Committee met the independence requirements of the Company'sCompany’s Corporate Governance Guidelines and the rules of NASDAQ. The committee met one time during the year. The Corporate Governance Charter wasw as provided in the 2008 Proxy Statement as Exhibit B.
The Asset-Liability Management Committee is appointed by the Chairman of the Board of Directors of the Company, subject to election by the full Board. The purpose of the Asset-Liability Management Committee is to monitor all aspects of the Company'sCompany’s Asset/Liability Management functions as set forth in Colony Bankcorp, Inc. Asset/Liability Management Policy. Mr. Hester, Mr. Downing, Mr. Roberts and Mr. Myler were members of this committee during the year. The committee met four times during the year.
The Nomination Committee is appointed by the Chairman of the Board of Directors of the Company,Company, subject to election by the full Board. The purpose of the Nomination Committee is to make recommendationsrecommendations to the Board on qualifications and selection criteria for Board members and review the qualificationsqualifications of potential candidates for the Board and to make recommendations to the Board on nominees to be elected at the Annual Meeting of Stockholders. Colony Bankcorp, Inc. has a standing Nomination Committee composed of the following members: Directors Harrell, Coleman, Minix, and Downing. Each of the members of the Committee werewas deemed independent as defined in the listing standards of NASDAQ. The Committee operates under the Corporate GovernanceGove rnance Charter which was provided in the 2008 Proxy Statement as Exhibit B. The Chartercharter was not amended in 2008.2009. The Charter is not currently available on the Company'sCompany’s website. The Committee does not currently have a policy or process for identifying and evaluating nominees. However, in addition to meeting the qualification requirements set forth by the Georgia Department of Banking & Finance, a possible director-candidate must also meet the following criteria to be considered by the Nominating Committee: independence; highest personal and professional ethics and integrity; willing to devote sufficient time to fulfilling duties as a Director; impact on the diversity of the Board's over allBoard’s overall experience in business, government, education, technology and other areas relevant to the Company'sCompany’s business; impact on the diversity of the Board'sBoard’s composition in terms of age, skills, ethnicity and other factors relevant to the Company'sCompanyR 17;s business; and number of other public company boards on which the candidate may serve (generally, should not be more than three public company boards in addition to the Company). The Committee does not currently have a policy with regard to the consideration of any director candidates recommended by shareholders. The Board of Directors has determined such a policy has been unnecessary in the past and will charge the Nomination Committee to evaluate the appropriateness of developing such a policy in the coming year. The committee met one time during the year.
The Audit Committee is appointed by the Chairman of the Board of Directors of the Company, subject to election by the full Board. The purpose of the Audit Committee is to assist the Board in fulfilling its oversight responsibilities for the Company'sCompany’s accounting and financial reporting processes and audits of the financial statements of the Company by monitoring the integrity of the Company'sCompany’s financial statements, the independence and qualifications of its external auditor, the Company'sCompany’s system of internal controls, the performance of the Company'sCompany’s internal audit process and external auditor and the Company'sCompany’s compliance with laws, regulations and the Directors and Senior Financial Officers Code of Ethical Conduct and the Code of Conduct. Mr.;Mr. Waldron, Mr. Massee, Mr. Downing, Mr. Myler and Mr. J. Ross were members of this committee during the year. As of December 31, 2008,2009, the members of the Audit Committee met the independence requirements of the Company'sCompany’s Corporate Governance Guidelines and the Rules of NASDAQ. The committee met eleven times during the year.
Audit Committee Charter
The Board of Directors has adopted a written charter for the Audit Committee, a copy of which was provided in the 2008 Proxy Statement as Exhibit A. The Board of Directors reviews and approves changes to the Audit Committee charter annually. The Charter was not amended in 2008.2009.
Independence of Audit Committee Members
The Company'sCompany’s Audit Committee is comprised of Mark H. Massee, Charles E. Myler, L. Morris Downing, Jr., B.GeneB. Gene Waldron and Jonathan W.R. Ross. Each of these members meets the requirements for independence as defined by the applicable listing standards of NASDAQ and SEC regulations applicable to listed companies. In addition, the Board of Directors has determined that at least one member of the Audit Committee meets the rules of NASDAQ standard of having accounting or related financial management expertise. Mr. Myler was elected the financially sophisticated individual on the Audit Committee in lieu of naming a "financial“financial expert.” In addition, Mr. Downing was elected Chairman of the Audit Committee.
The Audit Committee does not include a financial expert as defined by the Sarbanes Oxley Act of 2002 and the Company has not named a financial expert because the Board of Directors has determined the financial acumen of each member of the Audit Committee to be very strong and capable of satisfactorily discharging their duties and responsibilities to the Board of Directors and the shareholders.
Audit Committee Report
The Audit Committee reports as follows with respect to the audit of the Company's 2008Company’s 2009 audited consolidated financial statements.
| | · | The Committee has reviewed and discussed the Company's 2008Company’s 2009 audited consolidated financial statements with the Company'sCompany’s management; |
| | · | The Committee has discussed with the independent auditors, McNair, McLemore, Middlebrooks, & Co., LLP, the matters required to be discussed by SAS 61, which include, among other items, matters related to the conduct of the audit of the Company'sCompany’s consolidated financial statements; |
| | · | The Committee has received written disclosures and the letter from the independent auditorsauditors required by the applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor’s communications with the Committee concerningconcerning independence and discussed with the auditors the auditors’ independence from the Company and its management; and |
| | · | Based on review and discussions of the Company's 2008Company’s 2009 audited consolidated financial statements with management and discussions with the independent auditors, the Audit Committee recommended to the Board of Directors that the Company's 2008Company’s 2009 audited consolidated financial statements be included in the Company'sCompany’s Annual Report on Form 10-K for filing with the Securities and Exchange Commission. |
March 23, 200922, 2010 | AUDIT COMMITTEE: | |
| | | |
| | L. Morris Downing, Jr. | B. Gene Waldron |
| | L. Morris Downing, Jr.Charles E. Myler | Jonathan W.R. Ross |
| | Charles E. Myler | Mark H. Massee |
Stock Ownership
Security Ownership of Certain Beneficial Owners
As of March 1, 2009,31, 2010, the Company’s records and other information from outside sources indicated the following were beneficial owners of more than five percent of the outstanding shares of the Company’s common stock:
| Name and Address | | Shares Beneficially Owned | | | Percent of Class | |
| | | | | | | |
| Robert Sidney Ross (1) | | | 1,441,747 | | | | 17.07 | % |
| P.O. Box 644 | | | | | | | | |
| Ocilla, Georgia 31774 | | | | | | | | |
| | | | | | | | | |
| B. Gene Waldron | | | 600,559 | | | | 7.11 | % |
| P.O. Box 1265 | | | | | | | | |
| Douglas, Georgia 31534 | | | | | | | | |
| | | | | | | | | |
| Polaris Capital Management, Inc. | | | 449,187 | | | | 5.32 | % |
| 125 Summer Street, Suite 1470 | | | | | | | | |
| Boston, Massachusetts 02110 | | | | | | | | |
| | | | | | | | | |
| United States Department of the Treasury (2) | | | 500,000 | | | | 5.59 | % |
| 1500 Pennsylvania Avenue, NW | | | | | | | | |
| Washington, D.C. | | | | | | | | |
| Name and Address | | Shares Beneficially Owned | | | Percent of Class | |
Robert Sidney Ross (1) P. O. Box 666 Ocilla, Georgia 31774 | | | 814,426 | | | | 11.26 | % |
| | | | | | | | | |
Polaris Capital Management, Inc 125 Summer Street, Suite 1470 Boston, Massachusetts 02110 | | | 450,387 | | | | 6.23 | % |
(1) Includes 678,7621,306,072 shares held by Robert Sidney Ross; 99,771 shares held by Ross of Georgia, Inc.; and 35,396 shares held by family trusts and 497508 shares held by spouse. Mr. Ross disclaims beneficial ownership of those shares held by family trusts and held by spouse.
(2) Includes warrants solely issued through the TARP CPP program by U.S. Treasury to purchase 500,000 shares of common stock. The warrants have not been exercised as of March 31, 2010, however for purposes of this disclosure, the percentage ownership is calculated as if the 500,000 shares were issued on March 31, 2010.
Directors and Executive Officers
The following table sets forth information as of March 1, 200931, 2010 regarding the ownership of Colony Bankcorp stock by each Colony Bankcorp director (including nominees for director) and by the named executive officers of Colony Bankcorp and its subsidiaries, and by all directors and executive officers as a group.
| Name | | Shares Beneficially Owned (1) | | | Percent of Class | |
| | | | | | | |
| Terry L. Coleman Director | | | 176,398 | | | | 2.44 | % |
| L. Morris Downing, Jr Director | | | 225,214 | | | | 3.11 | % |
| Edward J. Harrell Director | | | 28,249 | | | | 0.39 | % |
| Terry L. Hester Director; Executive Officer | | | 135,184 | | | | 1.87 | % |
| Mark H. Massee Director | | | 49,514 | | | | 0.68 | % |
| James D. Minix Director | | | 124,505 | | | | 1.72 | % |
| Charles E. Myler Director | | | 5,355 | | | | 0.07 | % |
| W.B. Roberts, Jr Director | | | 28,528 | | | | 0.39 | % |
| Al D. Ross Director; Executive Officer | | | 35,192 | | | | 0.49 | % |
Jonathan W.R. Ross Director | | | 38,145 | | | | 0.53 | % |
| B. Gene Waldron Director | | | 98,534 | | | | 1.36 | % |
| Henry F. Brown, Jr. Executive Officer | | | 8,597 | | | | 0.12 | % |
Walter P. Patten Executive Officer | | | 44,756 | | | | 0.62 | % |
| G. Edward Smith III Executive Officer | | | 4,236 | | | | 0.06 | % |
| Larry E. Stevenson Executive Officer | | | 21,289 | | | | 0.29 | % |
| All directors and executive officers as a group (15 persons) | | | 1,023,696 | | | | 14.16 | % |
| Name | | Shares Beneficially Owned (1) | | | Percent of Class | |
| | | | | | | |
| Terry L. Coleman | | | 179,864 | | | | 2.13 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| L. Morris Downing, Jr. | | | 262,214 | | | | 3.10 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| Edward J. Harrell | | | 30,749 | | | | 0.36 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| Terry L. Hester | | | 137,684 | | | | 1.63 | % |
| Director; Executive Officer | | | | | | | | |
| | | | | | | | | |
| Mark H. Massee | | | 49,514 | | | | 0.59 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| James D. Minix | | | 124,505 | | | | 1.47 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| Charles E. Myler | | | 7,855 | | | | 0.09 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| W.B. Roberts, Jr. | | | 29,039 | | | | 0.34 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| Al D. Ross | | | 45,628 | | | | 0.54 | % |
| Director; Executive Officer | | | | | | | | |
| | | | | | | | | |
| Jonathan W.R. Ross | | | 38,145 | | | | 0.45 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| B. Gene Waldron | | | 600,559 | | | | 7.11 | % |
| Director | | | | | | | | |
| | | | | | | | | |
| Henry F. Brown, Jr. | | | 8,597 | | | | 0.10 | % |
| Executive Officer | | | | | | | | |
| | | | | | | | | |
All directors and executive officers as a group (12 persons) | | | 1,514,353 | | | | 17.93 | % |
| (1) | Includes shares owned by spouses and minor children of officers and directors, as well as shares owned by trusts or businesses in which officers and directors have a significant interest. The information contained herein shall not be construed as an admission that any such person is, for purposespurposes of Section 13(d) or Section 13(g) of the Securities Exchange Act of 1934, the beneficial owner of any securities not held of record by that person or entity. |
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
Overview of Compensation Program
The Compensation Committee (for purposes of this analysis, the “Committee”), composed entirely of independent Directors, is responsible to our Board, and indirectly to our shareholders, for monitoring and implementing our executive compensation program. The Committee reviews and recommends executive compensation levels, stock awards and non-equity incentives for executive officers. The Committee ensures that the total compensation paid to an executive officer is fair, reasonable and competitive.
Throughout this executive compensation discussion and analysis, the individuals who served as the Company’s Chief Executive Officer and Chief Financial Officer during fiscal year 2008, as well as the other individuals included in the Summary Compensation Table on page 25, are referred to as the “named executive officers.”
Compensation Philosophy and Objectives
The Committee believes that our executive compensation program should be designed and administered to provide a competitive compensation program that will enable us to attract, motivate, reward and retain executives who have the skills, education, experience and capabilities required to discharge their duties in a competent, efficient and professional manner. The Committee believes that the most effective compensation program is one that is designed to reward the achievement of specific annual, long-term and strategic goals by the Company, and which aligns executives’ interests with those of the shareholder by rewarding performance above established goals, with the ultimate objective of improving shareholder value. To that end, the Committee believes executive compensation packages provided by the Company to its executives should include both cash and stock-based compensation that reward performance as measured against established goals.
Role of Executive Officers in Compensation Decisions
The Committee makes all compensation decisions for the Chief Executive Officer, the Chief Financial Officer and all named executive officers and approves recommendations regarding equity awards to all elected officers of the Company. Decisions regarding the non-equity incentive plan compensation of other executive officers are reviewed and approved by the Committee and Chief Executive Officer.
The Committee and the Chief Executive Officer annually review the performance of the named executive officers (other than the Chief Executive Officer whose performance is reviewed by the Committee). The conclusions reached and recommendations based on these reviews, including with respect to salary adjustments and annual award amounts, are presented to the Committee. The Committee can exercise its discretion in modifying any recommended adjustments or awards to executives.
Setting Executive CompensationSUMMARY COMPENSATION TABLE
Based onThe table below summarizes the foregoing objectives, the Committee has structured the Company’s annual and long-term incentive executivetotal compensation to motivate executives to achieve business goals setpaid or earned by the Company and reward the executives for achieving such goals.
The Committee’s policy is to determine the compensation components of executive compensation principally upon the basis of corporate performance, although the elements of corporate performance may vary from year to year. Among the performance factors which the Committee considers are corporate profitability, asset quality, growth and corporate performance relative to industry standards such as problem asset levels, past due loan levels, loan production, net interest rate margin and net overhead. The Committee does not use a formula to calculate the relative weight of these performance factors in establishing base salary, but does give significant subjective weight to the overall value of Colony Bankcorp from year to year.
The Committee takes into account how the overall level of Colony Bankcorp’s executive compensation compares to similar-sized bank holding companies in the Southeastern United States. It was determined that the salary, non-equity incentive plans and stock awards of executive compensation was generally within competitive market limits of similar-sized bank holding companies. All other employment benefitscash of the named executive officers were found to be generally within competitive limits.
The Committee also considers the potential impact of Section 162(m)and of the Internal Revenue Code of 1986, as amended (Section 162(m)). Section 162 (m) disallows a tax deduction for any publicly held corporation for individual compensation exceeding $1 million in any taxable yearnext two highest paid officers for the Chief Executive Officerfiscal years ended December 31, 2009 and 2008. The Company has not entered into any employment contracts with any of the other named executive officers other than compensation that is performance-based under a plan that is approvedor the next two highest compensated officers.
2009 SUMMARY COMPENSATION TABLE
| Name and | | | Salary | | | Bonus | | | Stock Awards | | | Non-Equity Incentive Plan Compensation | | | All Other Compensation | | | Total | |
| Principal Position | Year | | ($) | | | ($)(1) | | | ($)(2) | | | ($) | | | ($)(3) | | | ($) | |
| Al D. Ross | 2009 | | $ | 225,000 | | | | -- | | | $ | 24,075 | | | $ | -- | | | $ | 37,434 | | | $ | 286,509 | |
| President and Chief | 2008 | | | 225,000 | | | | -- | | | | 38,000 | | | | -- | | | | 42,958 | | | | 305,958 | |
| Executive Officer | | | | | | | | | | | | | | | | | | | | | | | | | |
| of the Company | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Terry L. Hester | 2009 | | $ | 162,750 | | | | -- | | | $ | 8,025 | | | $ | -- | | | $ | 18,760 | | | $ | 189,535 | |
| Executive Vice President | 2008 | | | 162,750 | | | | -- | | | | -- | | | | -- | | | | 22,336 | | | | 185,086 | |
| and Chief Financial | | | | | | | | | | | | | | | | | | | | | | | | | |
| Officer of the Company | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Walter P. Patten | 2009 | | $ | 165,000 | | | $ | -- | | | $ | 4,815 | | | $ | -- | | | $ | 14,868 | | | $ | 184,683 | |
| City President and | 2008 | | | 165,000 | | | | 300 | | | | 11,400 | | | | -- | | | | 23,265 | | | | 199,965 | |
| Regional Executive Officer | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Larry E. Stevenson | 2009 | | $ | 145,000 | | | $ | -- | | | $ | 4,815 | | | $ | -- | | | $ | 8,559 | | | $ | 158,334 | |
| Regional Credit Officer | 2008 | | | 145,000 | | | | 300 | | | | 11,400 | | | | -- | | | | 13,658 | | | | 170,358 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Henry F. Brown, Jr. | 2009 | | $ | 105,000 | | | $ | -- | | | $ | 4,013 | | | $ | -- | | | $ | 253 | | | $ | 109,266 | |
| Senior Credit | 2008 | | | 88,906 | | | | 300 | | | | 7,600 | | | | -- | | | | 54 | | | | 96,860 | |
| Administrator and | | | | | | | | | | | | | | | | | | | | | | | | | |
| Regional Credit Officer | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Steve Wood | 2009 | | $ | 103,846 | | | $ | -- | | | $ | 12,038 | | | $ | -- | | | $ | 715 | | | $ | 116,599 | |
| MSA Group Executive | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) Amounts shown were determined by the shareholders of the corporationCompensation Committee at its November 18, 2008 meeting and that meets certain other technical requirements. Based on these requirements, the Committee has determined that Section 162(m) will not prevent the Company from receiving a tax deduction for any of the compensationwere paid to executive officers.out in November 2008.
2008 Executive Compensation Components
For(2) Amounts shown reflect the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2008, the principal components of compensation2009, in accordance with stock grant awards pursuant to Colony Bankcorp, Inc. 2004 Restricted Stock Grant Plan.
(3) Amount shown reflects for each named executive officers were:
officer:
| · | performance-based cash incentive compensation; |
| · | long-term equity stock award; |
| · | profit sharing benefits;401(k) contributions allocated by the Company to each of the named executive officers pursuant to Colony Bankcorp, Inc. 401(k) Plan (see below for more fully described plan); and |
| | · | perquisitesThe value attributable to life insurance benefits, personal use of Company-provided automobiles, country club membership, director fees, and other personal benefits.dividend income (see below for a more full description of benefits under the heading “Perquisites and Other Benefits”). |
Base Salary
The Company provides named executive officers and other employees with base salary to compensate them for services rendered during the fiscal year. Base salary ranges for named executive officers are determined for each executive based on his position and responsibility.
During its review of base salaries for executives, the Committee primarily considers:
| · | market data provided by industry publications and surveys with particular emphasis on peer company’s proxy statement compensation disclosures; |
| · | internal review of the executive’s compensation, both individually and relative to other executive officers; and |
| · | individual performance of the executive. |
The Committee considers peer company’s proxy statement compensation disclosures to determine competiveness in executive compensation. Those peer companies include Ameris Bancorp (ABCB), PAB Bankshares (PABK), Southwest Georgia Financial Corporation (SGB), SecurityBank Corporation (SBKC) and Savannah Bancorp (SAVB). The Committee determined that the Company’s compensation is competitive with the peer companies.
Additionally, the Committee bases their decision on a review of the executive’s compensation - -both individually and relative to other executive officers along with the individual performance of the executive. Factored into their decision is the overall performance of the Company in meeting objectives of balance sheet growth, return on equity and credit quality. The Committee determined that the executive officers were instrumental in carrying out Company iniatives and was factored into the base salary considerations by the Committee for 2008.
Salary levels are typically considered annually as part of the Company’s performance review process as well as upon a promotion or other change in job responsibility.
Performance-Based Cash Incentive Compensation
The Company provides a performance-based cash incentive plan (“PBCIP”) for named executive officers and other employees that is tied to a weighting factor, of which 50 percent of the cash award is based on the Company’s return on equity for the Chief Executive Officer and the Chief Financial Officer and 20 percent of the cash award is based on the Company’s return on equity for the named executive officers, along with other weighting factors of loan growth, problem asset reduction, net interest margin, net overhead, past due loan levels and charge-off loan levels with the reward potential within a range of 10 percent to 50 percent of base salary. The Committee can exercise its discretion to adjust the reward based on special circumstances or events occurring during the fiscal year in question.
In December of each year, the Committee sets the potential minimum, target and maximum levels for each component of the PBCIP for the next fiscal year. Payment of awards under the cash incentive plan are based upon the achievement of such objectives for the current year. The potential target levels established are tied to meeting balance sheet growth objectives, net income and return on equity objectives and credit quality objectives and weigh heavily in the Committee’s decision for payouts with the performance-based cash incentive plan. In 2007 the Company had earnings of $8.5 million or $1.19 per share compared to $10.2 million or $1.41 per share in 2006, while assets were $1.2 billion at year end 2007 or a decrease of 0.4 percent over the prior year. Actual performance for 2007 weighed heavily in the Committee’s decision for payouts with the performance-based cash incentive plan. In general, the performance levels were between minimum and target, but the Committee factored in actual net income decline, balance sheet flatness and credit quality iniatives to make their decision in final bonus award payouts.
Each of the named executive officers for the fiscal year ended December 31, 2007 received the following payments in January 2008 under the PBCIP for fiscal 2007 performance.
| Name | | 2007 PBCIP BonusAward | |
| | | | |
| Al D. Ross | | $ | 38,000 | |
| Terry L. Hester | | | 25,000 | |
| Walter P. Patten | | | 30,000 | |
| Larry E. Stevenson | | | 25,000 | |
| Henry F. Brown, Jr. | | | 8,000 | |
Awards made to named executive officers under the PBCIP for performance in 2008 are reflected in column (g) of the Summary Compensation Table on page 25.
Long-Term Equity Stock Award
In 2004, the Board of Directors adopted and the shareholders approved the Colony Bankcorp, Inc. 2004 Restricted Stock Grant Plan. The plan enables our Board of Directors, or a committee thereof, to grant up to 143,500 shares of Colony Bankcorp, Inc. common stock to key officers and employees of Colony Bankcorp, Inc. and our subsidiaries. The purpose of this plan is to attract, retain and develop strong management as the Company continues to expand, and to induce key individuals who render services that contribute materially to our success to remain with us for the long-term. Shares granted vest over a three year period. During the three year vesting period and under conditions set forth in Colony Bankcorp Inc.’s 2004 Restricted Stock GrantGran t Plan, the shares are subject to forfeiture. In the event of a change in control of the Company, as defined in the Plan, all unvested stock grants immediately become fully vested.
The Restricted Stock Grant Plan assists the Company to:
| | · | enhance the link between the creation of stockholder value and long-term executive incentive compensation; |
| | · | provide an opportunity for increased equity ownership by executives; and |
| | · | maintain competitive levels of total compensationcompensation. |
The Compensation Committee (the “Committee”) recommended for the Board of Directors’sDirector’s approval stock grant awards to be awarded for fiscal year 2008.2009. Factors considered by the Committee in awarding stock grants were based on the overall performance of the Company and the executive officer’s contribution in carrying out and meeting Company iniatives.initiatives. The primary focus of the Committee is to retain key individuals and to increaseincrease equity ownership by executives with the stock grant awards. The compensation committee is motivated to keep our executive compensation packages competitive with peer companies. The compensation committee reviews, at least annually, the peer company disclosures regarding executive compensation in order to ensure that our overall compensation pa ckage compares favorably. One of the areas monitored is stock option plans or in our case a stock grant award plan. The CEO works daily with executive officers and top level officers and offers his input each year as to recommendations for stock awards based on the executive officers and top level officers’ production and performance to the overall company strategy. The recommendation is for named executives other than himself and the CFO. Stock awards for the CEO and CFO are determined and set by the compensation committee, while awards for the other named executive officers and top level officers are considered upon the recommendation of the CEO. The CEO makes no recommendations in regard to his compensation. It was deemed prudent by the compensation committee to grant 2009 stock grant awards based upon the efforts of company management in their movement toward solidification of the consolidation efforts that became a company priority when the merger of the Company was approved on August 1, 2008.
Each of the named executive officers and top-level officers for the fiscal year endedend December 31, 20082009 received the following stock grant awards in January 2008:2009:
| Name | # of Shares | Stock Award Value |
| Al D. Ross | 3,000 | $24,075 |
| Terry L. Hester | 1,000 | 8,025 |
| Walter P. Patten | 600 | 4,815 |
| Larry E. Stevenson | 600 | 4,815 |
| Henry F. Brown, Jr. | 500 | 4,013 |
| Steve Wood | 1,500 | 12,038 |
| Name | | # of Shares | | | Stock Award Value | |
| Al D. Ross | | | 2,500 | | | $ | 38,000 | |
| Terry L. Hester | | | -- | | | | -- | |
| Walter P. Patten | | | 750 | | | | 11,400 | |
| Larry E. Stevenson | | | 750 | | | | 11,400 | |
| Henry F. Brown, Jr. | | | 500 | | | | 7,600 | |
The 2008 number of shares of stock awarded for named executive officers is included in column (i) of the 2008 Grants of Plan-Based Awards Table on page 27, while the stock award value for named executive officers is included in column (e) of the 2008 Summary Compensation Table on page 25.
Colony Bankcorp, Inc. 401(k) Plan
The Company has adopted a 401(k) Plan which provides for the Board of Directors to make a discretionary contribution to the 401(k) Plan out of profits in an amount not to exceed 10 percent of the total annual eligible compensation of the employees eligible to participate in the plan. Employees are eligible for a Company contribution after completion of one year of service. The contribution by the Company is allocated among the participants based on participant’s total eligible compensation. The employee’s interest vests over a period of six years.
The Committee recommended for the Board of Director’s approval that the level of fundingno contribution be made for fiscal year 2008 be set at 2.15 percent of eligible compensation.2009. The Committee based their recommendation to reduce the level of funding from 5.25 percent in 2007 to 2.15 percent in 2008not make a company contribution on the decrease in net income from $8.5 million in 2007 to $2.0 million in 2008.2008 to a net loss of $20.5 million in 2009. Though no company contribution was paid in 2009, employees will receive their allocation portion of funds in a forfeiture account in which terminated employees had an unvested balance in their account.
Each of the named executive officers for fiscal year ended December 31, 20082009 received the following 401(k) Plan contribution:allocation of terminated employees unvested balances:
| Name | | Amount | |
| Al D. Ross | | $ | 844 | |
| Terry L. Hester | | | 588 | |
| Walter P. Patten | | | 596 | |
| Larry E. Stevenson | | | 527 | |
| Henry F. Brown, Jr. | | | 372 | |
| Steve Wood | | | N/A | |
| Name | | Amount | |
| Al D. Ross | | $ | 4,945 | |
| Terry L. Hester | | | 4,360 | |
| Walter P. Patten | | | 4,647 | |
| Larry E. Stevenson | | | 3,997 | |
| Henry F. Brown, Jr. | | | 2,173 | |
ContributionsAllocations credited to named executive officers’ 401(k) accounts for fiscal year ended December 31, 20082009 are included in column (i) of the 20082009 Summary Compensation Table on page 25.Table. These contributionsallocations will be credited to the 401(k) accounts in March, 2009.2010.
Perquisites and Other Personal Benefits
The Company provides named executive officers with perquisites and other personal benefits that the Company and the Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain superior employees for key positions. The Committee periodically reviews the levels of perquisites and other personal benefits provided to named executive officers.
The named executive officers are provided use of company automobiles, membership in country clubs, term life insurance coverage, and director fees and dividend income as part of their perquisites and other benefits. DetailedDetailed below is an analysis of 20082009 perquisites and other benefits for fiscal year ended December 31, 2008.2009.
| Name | | Company Vehicle | | | Term Life Insurance | | | Country Club Membership | | | Director Fees | | | Company Vehicle | | | Term Life Insurance | | | Country Club Membership | | | Director Fees | | | Dividend Income | |
| Al D. Ross | | $ | 2,883 | (1) | | $ | 252 | (2) | | $ | 1,428 | | | $ | 33,450 | | | $ | 2,909 | (1) | | $ | 384 | (2) | | $ | 1,344 | | | $ | 30,100 | | | $ | 1,853 | |
| Terry L. Hester | | | 1,106 | (1) | | | 580 | (2) | | | 690 | | | | 15,600 | | | | 963 | (1) | | | 1,100 | (2) | | | 90 | | | | 15,600 | | | | 419 | |
| Walter P. Patten | | | 2,924 | (1) | | | 1,084 | (2) | | | 1,560 | | | | 13,050 | | | | 1,425 | (1) | | | 1,100 | (2) | | | 1,620 | | | | 9,600 | | | | 527 | |
| Larry E. Stevenson | | | 1,585 | (1) | | | 1,006 | (2) | | | 620 | | | | 6,450 | | | | 1,264 | (1) | | | 1,021 | (2) | | | 420 | | | | 4,800 | | | | 527 | |
| Henry F. Brown, Jr. | | | -- | | | | 54 | (2) | | | -- | | | | -- | | | | -- | | | | 107 | (2) | | | -- | | | | -- | | | | 146 | |
| Steve Wood | | | | 345 | (1) | | | 224 | (2) | | | -- | | | | -- | | | | 146 | |
The Committee takes into consideration the overall compensation package in making their decisions regarding the various elements of the package. The Committee views the most significant elements of the compensation package to be base salary, performance-based cash incentive payout, stock grant awards and the profit sharing contribution. Perquisites and other personal benefits are common place for executives in the banking industry and compare favorably to other peer companies. The Committee determined that the Company’s executive compensation is competitive with the peer companies.
Effect of U.S. Treasury Department Capital Purchase Program