To Our Stockholders,
By now you should have had time to study the Proxy Materials
that your Board of Directors sent you in connection with Guaranty
Bancshares' 1996 Annual Meeting, which was originally scheduled
for June 17, 1996. You may have also received or you may shortly
receive a proxy statement and a proxy card from Cari Investment
Company.
Cari Investment Company will ask you to sign and return to
them their proxy card. Their purpose is to get enough
shareholder votes to reject six of our nominees for election to
the Board of Directors and replace them with six of their own
nominees. In addition, Cari Investment Company wishes you to
reject the proposed Plan of Recapitalization that your Board of
Directors is asking you to approve.
In order to give you, the shareholders, time to evaluate the
situation, your Board of Directors has determined to postpone the
Guaranty Bancshares' 1996 Annual Meeting. You will therefore
find enclosed a Notice of Postponement of the Annual Meeting
which was scheduled for June 17, 1996. The Annual Meeting will
be rescheduled and you will receive a Notice giving you the new
date for the Annual Meeting and setting a new record date. Along
with the Notice of the new date for the Annual Meeting, you will
receive a new Proxy that we will ask you to sign and return to us
to replace the one that you previously received from us.
Cari Investment Company has made several serious claims
about your Board of Directors and Management and our operation
and management of Guaranty Bancshares. We believe that it is
very important that we set the record straight and therefore ask
you to read the remainder of this letter carefully so that you
can make an informed decision to support your Board of Directors
and Management. We strongly believe that we deserve your
continued support, based on our record and the other information
set forth below.
I therefore ask that you support all of the nominees of your
Board of Directors and also vote in favor of the Plan of
Recapitalization. I urge you to sign and return the Proxy that
your Board of Directors will send you when we notify you of the
date of the 1996 Annual Meeting. Your approval of the nominees
and of the Plan of Recapitalization presented by your Board of
Directors is in your best interests as a shareholder of Guaranty
Bancshares and is also in the best interests of Guaranty
Bancshares and Guaranty Bank.
I believe that Cari's statements and future plans for
Guaranty Bancshares are extremely detrimental to Guaranty
Bancshares and to you, its shareholders. I do not believe that
Cari Investment Company or its nominees for Guaranty Bancshares'
Board of Directors have your best interests or the best interests
of Guaranty Bancshares at heart. In fact, if their actions are
any indication of future behavior, the exact opposite may be
true.
Facts You Should Know About Current Management
I would like to contrast what Cari has stated or implied in
its proxy statement with what our current Management has
accomplished in the last six years, 1990 - 1995. We have taken
Guaranty Bancshares from losses totaling $3.94 million, with
substantial obstacles to remaining in existence, to a profitable
status. At the same time, we have increased stockholder equity
in Guaranty Bancshares, eliminated then outstanding debt,
recovered previously charged off loans and kept Guaranty
Bancshares and Guaranty Bank on a generally steadily improving
course. Here are some of the results of these six years:
Aggregate Net Income of Guaranty Bancshares:
$3,153,000
Stockholders' Equity increase: $3,040,000
Net recoveries of previously charged off loans:
$504,000
Payoff of outstanding debt, principal and interest:
$956,000
Payoff of outstanding debenture debt, principal and
interest: $889,000
Cash dividends to holders of $2.70 Preferred Stock:
$492,000
FDIC release of its Cease and Desist Orders and
withdrawal of the requirement that the then-current
Board of Directors invest $500,000 in Guaranty Bank to
shore up its deteriorating equity position
The level of Guaranty Bank's delinquent loans was
reduced from more than 13% to 2.5%
$2.5 million in repossessed assets held by Guaranty
Bank were sold without an additional loss
In 1989, Guaranty Bancshares Common Stock had a
negative net book value of $5.57 per share, whereas the
current appraised fair market value of the Common Stock
is $7.76 per share - a $13.33 per share increase in
value
Guaranty Bank's rating was upgraded by bank analysts
from non-rated to the current five star rating, the
highest rating than can be given
Your Board of Directors believes that the election of the
nominees to the Board of Directors and the approval of the Plan
of Recapitalization that they recommend to you are responsible
steps toward continuing the operational improvement and growth of
Guaranty Bancshares and Guaranty Bank.
I would also like to add a personal note to let you know how
strongly I feel about this situation. I am the co-trustee of a
trust that is one of the largest single shareholders of the
Common Stock of Guaranty Bancshares. I take my legal and moral
obligations to this trust very seriously. With these obligations
in mind, I do not hesitate to tell you that my co-trustee and I
will vote all of the trust's shares in favor of the nominees for
the Board of Directors and the Plan of Recapitalization
recommended to you by the Board. We will vote in this manner
because we believe that it is in the best interests of the trust,
of Guaranty Bancshares and its shareholders to do so.
I therefore urge you to vote for the twelve nominees of your
Board of Directors and in favor of the proposed Plan of
Recapitalization either by returning the proxy that we will send
you or by attending the Annual Meeting of Shareholders. We will
not use the Proxy that we previously sent you. Accordingly, it
is extremely important that you sign and return to Guaranty
Bancshares the Proxy that you will receive from us when we notify
you of the new date of the 1996 Annual Meeting.
If you do not intend to come to the meeting in person, I
would be grateful if you would return the new Proxy at your
earliest convenience after receiving it. If you have already
returned the old proxy, please accept my thanks for your prompt
response and apologies for asking you to execute a new one. I
also urge you to neither sign nor return the proxy furnished to
you by Cari Investment Company.
Your Board and Management wish to thank you for your
confidence in our operation of Guaranty Bancshares to date and
ask for your continued support on our steady path of growth and
profitability. If you have any questions concerning this letter
or our proxy materials, please call me, Conley Dutreix or Lee
Ringeman at 504-384-2813.
With best regards, I remain
Sincerely,
Brooks Blakeman
Chairman, Board of Directors