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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
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Murfreesboro Bancorp, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(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:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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[LOGO]
MURFREESBORO BANCORP, INC.
March 29, 2001
TO THE STOCKHOLDERS OF MURFREESBORO BANCORP, INC.:
In connection with the Annual Meeting of Stockholders of your Company to be held
on April 19, 2001, we enclose a Notice of Annual Meeting of Stockholders, a
proxy statement, and a form of proxy.
The shareholders are being asked to elect the board of directors to serve until
the next Annual Meeting of Stockholders in 2002 or until their successors are
duly elected and qualified and to ratify the appointment of Rayburn, Betts &
Bates, P.C. as the Company's independent accountants and auditors for fiscal
year 2001. Information about these matters is contained in the attached proxy
statement.
You are cordially invited to attend the Annual Meeting of Stockholders in
person. We would appreciate your completing the enclosed form of proxy so that
your shares can be voted in the event that you are unable to attend the meeting.
If you are present at the meeting and desire to vote your shares personally,
your form of proxy will be withheld from voting upon your request prior to
balloting. We urge you to return your proxy card in the enclosed envelope as
soon as possible.
Sincerely,
William E. Rowland Joyce Ewell
President and Chief Executive Officer Executive Vice President
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MURFREESBORO BANCORP, INC.
615 Memorial Boulevard
Murfreesboro, Tennessee 37129
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 19, 2001
Notice is hereby given that the Annual Meeting of Stockholders of Murfreesboro
Bancorp, Inc. (the "Company"), will be held on April 19, 2001, at 5:00 P.M.,
Central Daylight Savings Time, 615 Memorial Boulevard, Murfreesboro, Tennessee
37129, for the following purposes:
1. To elect the Board of Directors for the coming year or until
their successors have been duly elected and qualified;
2. To ratify the appointment of Rayburn, Betts & Bates, P.C. as
the Company's independent accountants and auditors for fiscal
year 2001; and
3. To transact such other business as may properly come before
the meeting or any adjournment thereof.
Stockholders of record at the close of business on March 9, 2001 are entitled to
notice of and to vote at the Annual Meeting of Stockholders.
By Order of the Board of Directors
Debbie Ferrell
Senior Vice President
Corporate Secretary
IMPORTANT
PLEASE MARK, SIGN, DATE, INDICATE IF YOU PLAN TO ATTEND THE ANNUAL MEETING AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED ENVELOPE.
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MURFREESBORO BANCORP, INC.
615 MEMORIAL BOULEVARD
MURFREESBORO, TENNESSEE 37129
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
APRIL 19, 2001
INFORMATION CONCERNING THE SOLICITATION
This statement is furnished in connection with the solicitation of proxies to be
used at the Annual Meeting of Stockholders (the "Annual Meeting") of
Murfreesboro Bancorp, Inc. (the "Company") to be held on April 19, 2001 at 5:00
P.M., Central Daylight Savings Time, at the Bank of Murfreesboro, 615 Memorial
Boulevard, Murfreesboro, Tennessee 37129 and at any adjournment or adjournments
thereof.
At the Annual Meeting, the stockholders will vote to elect a board of directors,
and to ratify the appointment of Rayburn, Betts & Bates, P.C. as the Company's
independent accountants and auditors for fiscal 2001. If a quorum exists, a
plurality of the votes cast is required to elect the directors and a majority of
the shares present or represented at the meeting is required to ratify the
appointment of Rayburn, Betts & Bates, P.C. as the Company's independent
accountants and auditors for fiscal 2001. The holder of each share of the
Company's common stock (the "Common Stock") is entitled to one vote on all
matters submitted before the Annual Meeting or any adjournments of the Annual
Meeting. The presence in person or by proxy of the holders of a majority of the
issued and outstanding shares of the Common Stock entitled to vote at the Annual
Meeting is necessary to constitute a quorum.
Stockholders are urged to sign the enclosed form of proxy and return it promptly
in the envelope enclosed for that purpose. Proxies will be voted in accordance
with the stockholders' directions. If no directions are given, proxies will be
voted FOR the election of the nominees named herein as directors, and FOR the
ratification of the appointment of Rayburn, Betts & Bates, P.C. as the Company's
independent accountants and auditors for fiscal year 2001.
The Board of Directors knows of no other business to be presented at the Annual
Meeting. If any other business is properly presented, the person named in the
enclosed proxy will use his discretion in voting the shares. The proxy may be
revoked at any time prior to the voting thereof by written request to the
Company at 615 Memorial Boulevard, Murfreesboro, Tennessee 37129, Attention:
Debbie Ferrell, Secretary. The proxy may also be revoked by submission to the
Company of a more recently dated proxy. The giving of the proxy will not affect
the right of a stockholder to attend the Annual Meeting and vote in person. If a
stockholder is present at the Annual Meeting and desires to vote his or her
shares personally, the stockholder's proxy will be withheld from voting upon
request prior to balloting.
The solicitation of proxies in the enclosed form is made on behalf of the Board
of Directors of the Company. The entire cost of soliciting these proxies will be
borne by the Company. In addition to being solicited through the mails, proxies
may be solicited personally or by telephone, facsimile or telegraph by officers,
directors and employees of the Company who will receive no additional
compensation for such activities. Arrangements will also be made with brokerage
houses and other custodians, nominees and fiduciaries to forward solicitation
materials to the beneficial owners of shares held of record by such persons, who
will be reimbursed for their reasonable expenses incurred in such connection. It
is expected that this Proxy Statement will first be sent to stockholders on
March 29, 2001.
OUTSTANDING VOTING SECURITIES
Only stockholders of record on March 9, 2001 are entitled to notice of and to
vote at the Annual Meeting. On that date there were 907,609 shares of Common
Stock issued and outstanding. The holder of each share of Common Stock is
entitled to one vote on all matters submitted before the Annual Meeting or any
adjournments of the Annual Meeting. The stockholders of the Company do not have
cumulative voting rights.
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SUBORDINATED CONVERTIBLE CAPITAL DEBENTURES
The Company issued $3,000,000 of floating rate subordinated convertible capital
debentures ("debentures") on September 29, 1999. Issuance costs related to the
debentures is approximately $25,000. The debentures convert to common stock of
the Company on August 31, 2011 at a conversion factor based upon the market
value of the common stock on that date.
If converted before that date, the conversion will be based upon one share of
common stock for every $12.50 of debentures held. The debentures began accruing
interest on January 1, 2000 and pay interest every December 15 with the final
interest payment being made at maturity. Interest payment is based upon a rate
equal to the weighted average prime rate less 0.5%.
The amount of debentures held by directors and officers of the Company at March
9, 2001 totaled $2,172,000.
PROPOSAL 1. ELECTION OF DIRECTORS
At the Annual Meeting, the Board of Director nominees are elected to hold office
for a term of one year or until their successors are elected and qualified. If
any nominee should be unable to accept nomination or election as a director,
which is not expected, the proxies may be voted with discretionary authority for
a substitute designated by the Board of Directors. The election of a director
requires a plurality of the votes cast.
The Board of Directors of the Company recommends the election of the following
nominees:
Melvin R. Adams, Sr.
Thomas E. Batey
Joyce Ewell
John Stanley Hooper
William E. Rowland
William H. Sloan
Joseph M. Swanson
Olin O. Williams, M.D.
The following table sets forth certain information regarding each of the
Company's directors:
Initial
Director Age (1) Position with the Company Principal Occupation Election
-------- ------- ------------------------- -------------------- --------
Olin O. Williams, M.D 70 Chairman of the Board Retired Surgeon 1998
and Director
William E. Rowland 53 President, Chief Executive Bank of Murfreesboro, 1998
Officer and Director President/Chief Executive
Officer
Joyce Ewell 57 Executive Vice President Bank of Murfreesboro, 1998
and Director Executive Vice President
Melvin R. Adams, Sr 61 Director State Farm Insurance Agent 1998
Thomas E. Batey 66 Director Batey's Office Supply 1998
John Stanley Hooper 68 Director Retired Farm Supply Dealer 1998
William H. Sloan 66 Director Sloan's Sales and Service, Inc. 1998
Joseph M. Swanson 62 Director Swanson, Inc. 1998
(1) - Age is as of December 31, 2000.
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The Board of Directors currently consists of the above-named eight directors.
At the annual meeting of stockholders, successors to each director whose term
expires at such meeting will be elected to serve for one-year terms or until
their successors are duly elected and qualified. The Board of Directors has the
power to appoint the officers of the Company. Each officer will hold office for
such term as may be prescribed by the Board of Directors and until such person's
successor is chosen and qualified or until such person's death, resignation or
removal. All of the following nominees were re-elected as directors at the April
20, 2000 annual meeting of shareholders. All of the following nominees also
serve as directors of the Bank of Murfreesboro (the "Bank") which is a wholly
owned subsidiary if the Company.
DIRECTORS AND OFFICERS OF THE COMPANY
MELVIN R. ADAMS, SR. is a director of the Company and the Bank having served
since 1997. He has approximately nineteen years of banking experience in the
Rutherford County market including serving as an advisory director of Commerce
Union Bank (now Bank of America, N.A.) from 1980 to 1982, having been a director
of First City Bank from January 1986 through March 1996. He was also a director
of First City Bancorp, Inc. from June 1988 until it was sold in March 1996. Mr.
Adams has been an agent for State Farm Insurance Company since 1971. Mr. Adams
is also the owner and president of Adams Aluminum Co., Inc., which provides home
remodeling services in Murfreesboro, a company he has owned since 1963. In
addition, he is an owner of Adams & Parks, Mel Adams Realty and
Hunter-Adams-Parks (partnership), all of which are real estate businesses. He is
a licensed contractor, real estate broker and also engages in farming. He holds
the Series 6 and 63 securities licenses. Mr. Adams is involved in many community
activities and is a member of the Rutherford County Homebuilders Association,
the Middle Tennessee Life Underwriters Association, and the Rutherford County
Adult Activity Center Board. He holds a Bachelor of Science from Middle
Tennessee State University and has attended various insurance schools and
programs.
THOMAS E. BATEY is a director of the Company and a director of the Bank having
served since 1997. He has approximately twelve years of banking experience in
the Rutherford County market having been a director of First City Bank and First
City Bancorp, Inc. from 1988 until it sold in 1996. Mr. Batey is the owner and
president of Batey's (office supplies) in Murfreesboro since 1957 as well as
Batey's Franklin (retail store) since 1967. Mr. Batey also engages in cattle
farming and is a partner in Batey's Farms. He is a member and/or Board member of
Middle Tennessee Christian School, Middle Tennessee Christian Foundation,
Rutherford County Chamber of Commerce, Murfreesboro Jaycees, Murfreesboro
Civitan Club, Rutherford County Adult Activity Center and the David Lipscomb
University Development Council. He was "Employer of the Year" for the
handicapped in 1972 and the Rutherford County Chamber of Commerce's "Business
Person of the Year" in 1991. He attended Middle Tennessee State University.
JOYCE EWELL is a director of the Company and executive vice president and a
director of the Bank and is responsible for the retail services offered by the
bank. She has over thirty-nine years of banking experience in the Rutherford
County market. Prior to joining the Bank, Ms. Ewell served as an Area Manager
for First American National Bank supervising seven branches. From 1985 to 1996
she held various positions with First City Bank culminating in being a member of
the board of directors and first vice president. For twenty-five years from 1961
until 1985, she held various positions with Commerce Union Bank (now Bank of
America, N.A.) in Rutherford County, culminating in vice president of marketing.
She serves numerous positions with community organizations and has received many
community awards including being voted the "Best Banker in Rutherford County" in
1995 and 1999 by the Daily News Journal polling subscribers. She has attended
various banking schools and classes including the University of Wisconsin School
of Banking.
JOHN STANLEY HOOPER is a director of the Company and the Bank having served
since 1997. He has almost twelve years of banking experience in the Rutherford
County market having been a director of First City Bank from 1988 until 1996 and
as a director of First City Bancorp, Inc. from June 1988 until it sold in March
1996. Mr. Hooper is the part owner and former president of Hooper Supply Co. in
Murfreesboro. Mr. Hooper served as president of Hooper Supply Co., Inc. from
1967 until retiring in 1995 and selling the business to his sons. He is a member
of the Tennessee Forage and Grassland Council, Farm Bureau, and the Tennessee
Cattlemen's Association. He attended Middle Tennessee State University and
Atlanta Business College (now Georgia State University).
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WILLIAM E. ROWLAND is president and a director of the Company and a director and
President and chief executive officer of the Bank having served since 1997. He
has thirty years of banking experience in the Rutherford County market including
his service with the Bank. In addition to Mr. Rowland's experience as internal
auditor, controller and chief financial officer with Mid-South Bank and Trust in
Murfreesboro (now SunTrust Bank of Tennessee, N.A.) from 1971 until 1985, he
served as president of First City Bancorp, Inc. in Murfreesboro for seven years
and supervised the lending function at the bank level from 1989 to 1996.
Following the sale of First City Bancorp, Inc. to First American Corporation
(which was acquired in 1999 by AmSouth Bancorporation,) Mr. Rowland served as
president and chief executive officer of Tennessee Credit Corporation - a
consumer finance company owned by First American Corporation. Mr. Rowland is a
member of the MTSU Board of Trustees and the Methodist Finance Board. Mr.
Rowland holds a Bachelor of Science and Master of Arts in finance from Middle
Tennessee State University and is a graduate of the School for Bank
Administration at the University of Wisconsin. He has also attended other
banking schools including one at the University of Oklahoma. Mr. Rowland is a
Certified Public Accountant (inactive) in the state of Tennessee and holds the
Series 7 and 63 securities licenses as well as a life insurance license.
WILLIAM H. SLOAN is a director of the Company and a director of the Bank having
served since 1997. He has over forty-one years of business experience in the
Rutherford County market having been employed in various positions with
Murfreesboro Federal Savings & Loan Association (now Calvary Banking, FSB) from
1957 until 1980 and as a director of First City Bank from January 1994 through
March 1996. Mr. Sloan is the owner and president of Sloan's Honda-Yamaha, a
motorcycle dealership, in Murfreesboro he has owned since 1960. He was the
recipient of the Murfreesboro Better Business Bureau's Torch Award for
marketplace ethics in 1999. Mr. Sloan is a member of the Murfreesboro Chamber of
Commerce and a Board member of Stones River Manor and the Adams Christian Trust.
He attended Middle Tennessee State University.
JOSEPH M. SWANSON is a director of the Company and the Bank. He has
approximately fifteen years of banking experience in the Rutherford County
market having been a director of First City Bank from January 1986 through March
1996, and previously, an advisory director for the Rutherford County offices of
First American National Bank. Mr. Swanson is the owner and president of Swanson,
Inc., and Swanson Developments in Murfreesboro. He is also a partner in Parsley
Brothers Construction and involved in real estate development in Rutherford
County and a partner in City Center, Ltd. Mr. Swanson was the Chamber of
Commerce's "Business Person of the Year" in 1988.
OLIN O. WILLIAMS, M.D. is the chairman of the board and director of the Company
and a director of the Bank. He has approximately fifteen years of banking
experience in the Rutherford County market having been a director of First City
Bank from January 1986 through March 1996 as well as having been a director of
First City Bancorp, Inc. from June 1988 until it was sold in March 1996. Dr.
Williams is a retired surgeon having worked at the Murfreesboro Medical Clinic
from 1967 until his retirement in 1994. He also serves as a director of National
HealthCare, L.P. and National Health Realty, Inc. He is a member of the
Rutherford County Medical Society, the Tennessee Medical Association, the
American Medical Association, the Southeastern Surgery Congress, Diplomate, and
the American Board of Surgery. He holds a Bachelor of Science and Doctor of
Medicine from the University of Tennessee.
DEBBIE R. FERRELL is Senior Vice President/Secretary of the Bank and Company.
She joined the Bank upon its opening in October 1997. She handles administrative
duties, supervises the nondeposit investment product area, serves on various
management committees and as a personal banker. Prior to joining the Bank Mrs.
Ferrell worked at First American National Bank as a Personal Banker until
January 1997. Prior to that time she worked at First City Bank as a Vice
President from March 1986 until its acquisition by First American National Bank
in March 1996. Before joining First City Bank Mrs. Ferrell worked at Mid-South
Bank and Trust (later acquired by Third National Bank, now SunTrust Bank of
Tennessee, N.A.)
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company held seven meetings during the 2000 fiscal
year and the Board of Directors of the Bank held fifteen meetings during the
2000 fiscal year. The Board of Directors of the Bank has a Loan Committee. The
Audit Committee represents both the Company and Bank.
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The Loan Committee met twenty-six times during 2000 and consists of Messrs.
Adams, Batey, Hooper, Rowland, Sloan, Swanson and Dr. Williams and Ms. Ewell
with Mr. Rowland serving as chairman. The Loan Committee has the responsibility
of setting and approving the loan policy, granting lending authority to
individual loan officers, approving any loans in excess of a loan officer's
lending authority, reviewing loans originated, monitoring the loan portfolio
for any loan concentrations, reviewing the allowance for possible loan losses,
monitoring past due loans, non-accrual loans and approving loan charge-offs.
The Audit Committee consists of Messrs. Batey, Hooper and Sloan with Mr. Batey
serving as chairman and met four times during 2000. All members of the Audit
Committee are independent in accordance with the definition set forth by the New
Stock Exchange. The Audit Committee has adopted a written Audit Committee
Charter which has been approved by the Board of the Directors of the Company and
which is attached hereto as Exhibit A. The Audit Committee reviews annual
reports and recommendations from the Company's independent auditors, interim
reports prepared by the Company's internal auditor, reviews regulatory
examinations, reviews reports in regards to the Company's regulatory compliance
and provides advice and assistance regarding the Company's accounting, auditing
and financial reporting practices.
All directors have served continuously since their first election. Each director
attended at least 75% of the meetings of the Board of Directors and the meetings
of the applicable committees for which the director is a member during 2000.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following individuals hold 5% or more of the outstanding voting common stock
of the Company. No other individual's hold 5% or more of the outstanding voting
common stock of the Company as of March 9, 2001.
NAME AND ADDRESS AMOUNT AND NATURE PERCENT
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS(1)
- ------------------- -------------------- -----------
William E. Rowland 147,087(2) 15.01%
1110 Virginia Avenue
Murfreesboro, Tennessee 37130
Joseph M. Swanson 120,300(2) 12.49%
100 East Vine Street - Suite 1500
Murfreesboro, Tennessee 37130
(1) - As of March 9, 2001 there are 907,609 shares of outstanding voting common
stock of the Company.
(2) - Includes 40,000 shares held as trustee for two sons' trusts, stock options
for 8,000 shares that expire on April 28, 2008 and 64,087 shares from conversion
of debentures held in individual retirement account and as trustee for sons'
trusts.
(3) - Includes 500 shares held jointly with daughter, stock options for 3,000
shares that expire April 28, 2008 and 52,800 shares from conversion of
debentures.
The following table shows the beneficial ownership of all directors and officers
of the Company individually and as a group as of March 9, 2001.
AMOUNT AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT
OF BENEFICIAL OWNER POSITION OWNERSHIP OF CLASS(1)
- ------------------- -------- ---------- ------------
William E. Rowland President, Chief Executive Officer and 147,087(2) 15.01%
1110 Virginia Avenue Director
Murfreesboro, Tennessee 37130
Joyce Ewell Executive Vice President and Director 34,057(3) 3.68%
2807 Bowers Lane
Murfreesboro, Tennessee 37129
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Melvin R. Adams Director 31,000(4) 3.37%
805 South Church Street
Murfreesboro, Tennessee 37130
Thomas E. Batey Director 11,045(5) 1.21%
2802 East Main Street
Murfreesboro, Tennessee 37130
John Stanley Hooper Director 20,732(6) 2.26%
3331 Siegel Lane
Murfreesboro, Tennessee 37129
William H. Sloan Director 17,000(7) 1.86%
2523 Morgan Road
Murfreesboro, Tennessee 37129
Joseph M. Swanson Director 120,300(8) 12.49%
100 East Vine Street - Suite 1500
Murfreesboro, Tennessee 37130
Olin O. Williams, M.D Director 22,275(9) 2.42%
2007 Riverview Drive
Murfreesboro, Tennessee 37129
Debbie R. Ferrell Senior Vice President and Secretary 31,916(10) 3.45%
2621 Spalding Circle
Murfreesboro, Tennessee 37128
All directors and officers as a group 435,437(11) 39.00%
(1) - As of March 9, 2001, there were 907,609 shares of outstanding voting
common stock of the Company.
(2) - Includes 40,000 shares held as trustee for two sons' trusts, options for
8,000 shares that expire on April 28, 2008 and 64,087 shares from conversion of
debentures held in individual retirement account and as trustee for sons' trusts
(3) - Includes 33 shares held as trustee for a minor, stock options for 5,600
shares that expire on April 28, 2008 and 13,049 shares from conversion of
debentures held individually, in individual retirement account and as custodian
for a minor.
(4) - Includes stock options for 3,000 shares granted to each non-employee
director that expire April 28, 2008 and 8,000 shares from conversion of
debentures.
(5) - Includes 250 shares held by wife, stock options for 3,000 shares that
expire April 28, 2008 and 2,795 from conversion of debentures.
(6) - Includes 500 shares as custodian for minors, stock options for 3,000
shares granted to each non-employee director that expire April 28, 2008 and
4,954 shares from conversion of debentures held jointly with wife, in individual
retirement account, in wife's individual retirement account and as custodian for
minors.
(7) - Includes 5,000 shares held by wife, stock options for 3,000 shares granted
to each non-employee director that expire April 28, 2008 and 4,000 shares from
conversion of debentures held individually and by wife.
(8) - Includes 500 shares held jointly with daughter, stock options for 3,000
shares that expire April 28, 2008 and 52,800 shares from conversion of
debentures.
(9) - Includes 400 shares held as custodian for minors, stock options for 3,000
shares that expire April 28, 2008 and 8,795 shares from conversion of debentures
held individually and as custodian for minors.
(10) - Includes 200 shares held by husband, 15 shares held as custodian for
minors, stock options for 3,600 shares that expire on April 28, 2008 and 12,992
shares from conversion of debentures held individually and as custodian for
minors.
(11) - Includes all shares listed in notes (2) through (10) above.
There are currently no arrangements which may result in a change of ownership of
control of the Company. The above directors have served as directors since
commencement of operations on October 6, 1997 and were re-elected at the
shareholder meeting on April 20, 2000. The term is for one year with annual
reappointment.
At December 31, 2000, there were no family relationships among directors and
officers. With the exception of Dr. Williams, none of the directors of the
Company serve as directors of any other company which has a class of securities
registered under the Securities Exchange Act of 1934 or any other bank holding
company, bank, savings and loan association or credit union. Dr. Williams is a
director of National HealthCare Corp. and National HealthRealty, Inc. Further,
no director or executive officer has been involved in any legal proceedings
including bankruptcy, criminal proceedings or injunction from involvement with
any business, banking or securities activities.
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EXECUTIVE COMPENSATION
The following table sets forth a summary of the compensation paid to or accrued
on behalf of the chief executive officer and any other officer of the Company
whose aggregate compensation exceeded $100,000 during fiscal years 2000, 1999,
and 1998:
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------------- -------------------------------
SECURITIES
OTHER UNDER- ALL
ANNUAL RESTRICTED LYING OTHER
NAME AND COMPEN- STOCK OPTIONS/ LTIP COMPEN-
PRINCIPAL POSITION YEAR SALARY BONUS SATION AWARDS SAR'S PAYOUTS SATION
- ------------------ ---- -------- ------ ------- ---------- ---------- ------- -------
William E. Rowland, 2000 $100,300 $3,000 $ -- $ -- $ -- $ -- $ --
President and 1999 $ 80,000 $ -- $ -- $ -- $ -- $ -- $ --
Chief Executive Officer 1998 $ 40,962 $ -- $ -- $ -- $ -- $ -- $1,750(1)
(1) - Represents director fees. All directors were paid $250 monthly through
July 1998. Beginning in August 1998 executive directors (Mr. Rowland and Mrs.
Ewell) received no director fees.
The non-employee directors were paid $500 per month in 1999 and $750 per month
in 2000. There is no other annual compensation for the non-employee directors.
No other officers had compensation in excess of $100,000.
Currently there are no employment contracts between the Company and any of its
employees or the Bank and any of its employees.
OPTION GRANTS IN LAST FISCAL YEAR
No options were granted to directors or officers during 2000 fiscal year or
exercised by officers or directors during the 2000 fiscal year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND YEAR END OPTION VALUES
No options were granted or exercised in the 2000 fiscal year. Stock options
listed below represent options outstanding at December 31, 2000:
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FISCAL YEAR END FISCAL YEAR END
SHARES
ACQUIRED UPON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
---- ------------- ------------ --------------- ---------------
William E. Rowland -0- $0 20,000 / 0 $50,000 / $0
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As previously mentioned, there are no family relationships between any of the
directors and officers of the Company or Bank.
Federal banking regulations require that all loans or extensions of credit to
executive officers and directors must generally be made on substantially the
same terms, including interest rates and collateral, as those prevailing at the
time for comparable transactions with other persons and must not involve more
than the normal risk of repayment or present other unfavorable features. The
Company's policy is not to make any new loans or extensions of credit to the
Company's executive officers and directors at different rates or terms than
those offered to the general public. The aggregate amount of loans by the
Company to its executive officers and directors was approximately $2,449,000 at
December 31, 2000.
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The Company entered into an agreement with Parsley Brothers Construction Company
("Parsley Brothers") in 1999 for construction of a new main office. Director
Swanson is a partner in Parsley Brothers. The original amount of the contract
was $2,059,000. With revisions and change orders the final amount of the
contract was $2,341,872. The Company paid $790,222 during 2000 in relation to
this contract. As part of its normal course of business the Company purchases
office supplies, furniture and equipment from a retail store owned by Director
Batey. During 2000, the Company paid $52,825 for such office supplies, furniture
and equipment.
PROPOSAL 2. RATIFICATION OF THE APPOINTMENT OF RAYBURN, BETTS & BATES, P.C. AS
THE COMPANY'S INDEPENDENT ACCOUNTANTS AND AUDITORS FOR FISCAL YEAR 2000
The Board of Directors has confirmed the appointment by the Audit Committee of
Rayburn, Betts & Bates, P.C. as the Company's independent accountants and
auditors for fiscal 2001. Rayburn, Betts & Bates, P.C. served as independent
accountants and auditors of the Company for the years ended December 31, 2000,
1999, 1998 and 1997. A representative(s) of the firm will be present at the
Annual Meeting, have an opportunity to make a statement if he (they) so desire
and is (are) expected to be available to respond to appropriate questions.
AUDIT FEES
The Company was billed fees of $39,000 for professional services rendered by the
accounting firm of Rayburn, Betts and Bates, P.C. for the audit of the Company's
financial statements for the most recent fiscal year and the reviews of the
financial statements in the Company's Forms 10-QSB for that fiscal year.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
The Company was not billed any fees for professional services rendered by the
accounting firm of Rayburn, Betts and Bates, P.C. in the areas of financial
system design and implementation during the most recent fiscal year.
OTHER FEES
The Company was billed fees of approximately $13,000 for other services rendered
by the accounting firm of Rayburn, Betts and Bates, P.C. for the most recent
fiscal year.
The affirmative vote of the holders of a majority of the outstanding shares of
Common Stock present or represented at the meeting is required to ratify the
appointment of Rayburn, Betts & Bates, P.C. as the Company's independent
accountants and auditors for fiscal year 2001.
The Board of Directors recommends voting FOR ratification of the appointment of
Rayburn, Betts & Bates, P.C. as the Company's independent accountants and
auditors for fiscal year 2001.
OTHER MATTERS
The Board of Directors, at the time of the preparation of this Proxy Statement,
knows of no business to come before the meeting other than that referred to
herein. If any other business should come before the meeting, the persons named
in the enclosed Proxy will have discretionary authority to vote all proxies in
accordance with their best judgment.
AUDIT COMMITTEE REPORT FOR 2000
The Audit Committee reviews annual reports and recommendations from the
Company's independent auditors, interim reports prepared by the Company's
internal auditor, reviews regulatory examinations, reviews reports in regards to
the Company's regulatory compliance and provides advice and assistance regarding
the Company's accounting, auditing and financial reporting practices. The Audit
Committee has discussed with the independent accountants the matters required by
Statement on Auditing Standards (SAS) No. 61 (Communication with Audit
Committees) and SAS No. 90 (Audit Committee Communications), has reviewed and
discussed the audited financial statements with management and received the
written disclosures from the independent accountants as required by Independence
Standards Board Standard No. 1 (Independence Discussions with Audit Committees)
and has discussed with the independent accountant the independent accountant's
independence.
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Based upon the review and discussions herein the Audit Committee recommended to
the Board of Directors inclusion of the audited financial statements in the
Company's Annual Report on Form 10-KSB for fiscal 2000 for filing with the
Securities and Exchange Commission. The Audit Committee consists of Messrs.
Batey, Hooper and Sloan with Mr. Batey serving as chairman and met four times
during 2000. All members of the Audit Committee are independent in accordance
with the definition set forth by the New York Stock Exchange. The Audit
Committee has adopted a written Audit Committee Charter which has been approved
by the Board of the Directors of the Company and which is attached hereto as
Exhibit A.
Thomas E. Batey, Chairman
John Stanley Hooper
William H. Sloan
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING
The federal securities laws require the Company's directors, executive officers
and persons who beneficially own more than 10% of a registered class of the
Company's equity securities, to file with the Securities and Exchange Commission
initial reports of ownership and reports of changes in ownership of any
securities of the Company. To the Company's knowledge, based solely on a review
of these copies furnished to the Company and representations by reporting
persons, all of its directors, executive officers and greater than 10%
beneficial owners made all filings required in a timely manner.
SHAREHOLDER PROPOSALS
Proposals by shareholders to be considered for inclusion in the proxy materials
solicited by the Board of Directors for the annual meeting of shareholders in
2002 must be received by Debbie Ferrell, Corporate Secretary, Murfreesboro
Bancorp, Inc., Box 20700, Murfreesboro, Tennessee 37129-0700 no later than
November 30, 2001. The use of Certified Mail - Return Receipt Requested is
advised To be eligible for inclusion, a proposal must also comply with Rule
14a-8 and all other applicable provisions of Regulation 14A under the Securities
Exchange Act of 1934.
ANNUAL REPORT OF FORM 10-KSB
Copies of the 2000 Annual Report to Shareholders are being mailed to all
shareholders together with this Proxy Statement. Upon request, we will provide
to you, without charge, a copy of your report on Form 10-KSB for the year ended
December 31, 2000 as filed with the Securities and Exchange Commission. Requests
should be directed to William L. Webb, Chief Financial Officer, Murfreesboro
Bancorp, Inc., Box 20700, and Murfreesboro, Tennessee 37129-0700.
BY ORDER OF THE BOARD OF DIRECTORS
Murfreesboro, Tennessee
March 29, 2001 Debbie Ferrell
Senior Vice President
Corporate Secretary
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EXHIBIT A
MURFREESBORO BANCORP, INC.
AUDIT COMMITTEE CHARTER
PURPOSE
The primary function of the Audit Committee of Murfreesboro Bancorp, Inc. (the
"Corporation") is to assist the Board of Directors in fulfilling its oversight
responsibilities with respect to the financial reports and other financial
information provided by the Corporation to the stockholders and others, the
Corporation's system of internal controls, and the Corporation's audit,
accounting, and financial reporting processes generally. In carrying out this
function, the Audit Committee shall serve as an independent and objective
monitor of the performance of the Corporation's financial reporting process and
system of internal control; review and appraise the audit efforts of the
Corporation's independent accountants and internal audit department; and,
provide for open, ongoing communication among the independent accountants,
financial and senior management, internal audit department, and the Board of
Directors concerning the Corporation's financial position and affairs.
COMPOSITION
The Audit Committee shall be comprised of three or more directors, as determined
by the Board of Directors, each of whom shall be an independent director as
determined in accordance with the Corporation's By-laws and New York Stock
Exchange. In accordance with Security and Exchange Commission ("SEC") rules, all
members of the Audit Committee shall be "financially literate," i.e., familiar
with basic finance and accounting practices, and at least one member of the
Committee shall have accounting or related financial management expertise.
MEETINGS
The Committee shall meet at least four times annually, or more frequently as
circumstances dictate. The Committee shall meet at least annually (and more
often as warranted) with the internal auditor (or individual from CPA firm
conducting the internal audit function) and the independent accountants in
separate executive sessions to discuss any matters that the Committee or each of
these groups believes should be discussed privately. The Committee shall
maintain a high degree of independence both in establishing its agenda and
directly accessing various members of Murfreesboro Bancorp, Inc. and subsidiary
management. The Committee shall meet annually with management. The internal
auditor and/or the audit committee of major subsidiary companies (as designated
by the Audit Committee) regarding their systems of internal control, results of
audits, and accuracy of financial reporting, if applicable.
RESPONSIBILITIES AND DUTIES
The Committee's responsibility is oversight, and it recognizes that the
Corporation's management is responsible for preparing the Corporation's
financial statements. Additionally, the Committee recognizes that financial
management (including the internal audit staff), as well as the independent
accountants, have more knowledge and more detailed information about the
Corporation than do the members of the Committee; consequently, in carrying out
its oversight responsibilities the Committee is not providing any expert or
special assurance as to the Corporation's financial statements or any
professional certification as to the independent accountants' work.
The following functions shall be the common recurring activities of the
Committee in carrying out its oversight responsibility. These functions are set
forth as a guide with the understanding that the Committee may diverge from this
guide as appropriate given the circumstances.
- Review with a representative of financial management and the
independent accountants the financial information contained in
the Corporation's Quarterly Report on Form 10-Q prior to its
filing, the Corporation's earnings announcements prior to
release, and the results of the independent accountants'
review of Interim Financial Information pursuant to SAS 71.
The Chair may represent the entire Audit Committee, either in
person or by telephone conference call, for purpose of this
review.
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- Review with management and the independent accountants at the
completion of the annual audit of the Corporation's
consolidated financial statements included in the Annual
Report on Form 10-KSB for the last fiscal year and prior to
its filling:
1. The Corporation's annual consolidated financial
statements and related footnotes;
2. The independent accountants' audit of the
consolidated financial statements and their report;
3. Any significant changes required in the independent
accountants' examination plan;
4. Any serious difficulties or disputes with management
encountered during the course of the audit; and
5. Other matters related to the conduct of the audit
which are to be communicated to the Audit Committee
under generally accepted auditing standards
including, discussions relating to the independent
accountants' judgments about such matters as the
quality, not just the acceptability, of the
Corporation's accounting practices and other items
set forth in SAS 61 (Communications with Audit
Committees) or other such auditing standards that may
in time modify, supplement or replace SAS 61.
- On an annual basis, the Audit Committee should ensure receipt
of, and review with the independent accountants, a written
statement required by Independence Standards Board (ISB)
Standard No. 1, as may be modified or supplemented, and
discuss with the accountants their independence. The Committee
will recommend that the Board of Directors take appropriate
action on any disclosed relationships that may reasonably be
thought to bear on the independence of the accountants and
satisfy itself that the Corporation has engaged independent
accountants as required by the Securities Acts administered by
the SEC.
- The Committee will have prepared and review the Audit
Committee Report for inclusion in the annual stockholders'
meeting proxy statement. The Audit Committee Report must state
whether the Audit Committee:
1. has reviewed and discussed the audited consolidated
financial statements with management;
2. has discussed with the independent accountants the
matters required to be discussed by SAS 61, as may be
modified, supplemented or replaced;
3. has reviewed the written disclosures from the
independent accountants required by ISB Standard No.
1, as may be modified or supplemented, and has
discussed with the accountants their independence;
and
4. has recommended to the Board of Directors, based on
the review and discussions referred to in above items
(1) through (3), that the Corporation's consolidated
financial statements be included in the Annual Report
on Form 10K SB for the last fiscal year for filing
with the Commission.
- The Audit Committee and Board of Directors are responsible for
the selection, evaluation and, where appropriate, replacement
of the independent accountants. Selection for the ensuing
calendar year will be submitted to the stockholders for
ratification of rejection at the annual meeting of
stockholders. Consistent with these responsibilities, it is
recognized that the independent accountants are ultimately
accountable to the Board of Directors and Audit Committee.
- Review and reassess the adequacy of the audit committee
charter on an annual basis. The charter will be included as an
appendix to the annual stockholders' meeting proxy statement
after any significant amendment to the charter.
- In consultation with the independent accountants and the
internal auditor, regularly review the integrity of the
Corporation's financial reporting processes and system of
internal control.
- Review and concur in the appointment, replacement,
reassignment or dismissal of the internal auditor. Confirm and
assure the objectivity of the internal auditor.
15
- Review the performance of the internal audit department,
including the objectivity and authority of its reporting
obligations, the proposed audit plans for the coming year, and
the coordination of such plans with the independent
accountants.
- Review, as needed, the internal audit department's charter,
which shall define its purpose, authority, and
responsibilities.
- Review policies and procedures with respect to officers'
expense accounts and perquisites, including their use of
corporate assets, and consider the results of any review of
these areas by the internal auditors or the independent
accountants.
- Review legal and regulatory matters that may have a material
impact on the Corporation's consolidated financial statements,
regulated compliance policies and programs, and reports
received from regulators.
In addition to the activities described above, the Audit Committee will perform
such other functions as necessary or appropriate under law, the Corporation's
charter or By-laws, and the resolutions and other directives of the Board of
Directors.
The Audit Committee shall have the power to conduct or authorize investigations
into any matter within its scope of responsibilities and shall be empowered to
retain independent counsel, accountants, or others to assist it in the conduct
of any investigation.
The duties and responsibilities of a member of the Audit Committee are in
addition to those duties pertaining to a member of the Board of Directors.
The Audit Committee will report its actions to the Board of Directors with such
recommendations as the Audit Committee may deem appropriate.
The above Audit Committee Charter was adopted by the Board of Directors of the
Company on March 15, 2001.
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MURFREESBORO BANCORP, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR ANNUAL MEETING OF STOCKHOLDERS TO
BE HELD APRIL 19, 2001
The undersigned hereby appoints William E. Rowland and Joyce Ewell, their
attorneys and agents, with full power of substitution, to vote as proxy for the
undersigned, at the Annual Meeting of Stockholders of Murfreesboro Bancorp, Inc.
(The "Company") to be held on April 19, 2001 at 5:00 P.M., local time, at the
Bank of Murfreesboro, 615 Memorial Boulevard, Murfreesboro, Tennessee and at any
adjournment or postponement thereof, according to the number of votes the
undersigned would be entitled to vote if personally present on the proposals set
forth on the reverse side of this card (and as more particularly set forth on
the notice of Meeting enclosed herewith) and in accordance with their discretion
on any other procedural matters that may properly come before the meeting or any
adjournment or postponement thereof.
All shares of the Company's Common Stock that are represented at the Annual
Meeting by properly executed proxies received prior to or at the Annual Meeting
and not revoked will be voted at the Annual Meeting in accordance with the
instructions indicated on the reverse side of this card. If no instructions for
the proposal are indicated on an executed Proxy Card, such proxies will be voted
in accordance with the recommendations of the Board of Directors as set forth
herein with respect to such proposal.
PLEASE SIGN AND DATE THE REVERSE SIDE
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR:
1. Approve the election of the Board of Directors to serve a term of one year or
until their successors are duly elected.
(To vote against any director, draw a line through the name of the director:
Melvin R. Adams, Thomas E. Batey, Joyce Ewell, John Stanley Hooper, William
E. Rowland, William H. Sloan, Joseph M. Swanson and Olin O. Williams, M.D.)
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. Approve the election of the public accounting firm of Rayburn, Betts and
Bates, P.C. to serve as independent auditors for the 2001 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In their discretion, to act upon such other procedural matters as may
properly come before the meeting and any adjournment thereof.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
PLEASE SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE
[ ] If you plan to attend the Annual Meeting of
Stockholders, please mark the following box and
promptly return this Proxy Card.
Number Attending
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[ ] Change of Address
Mark Here and Write New Address Below
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Signature of stockholders should correspond with the
names shown on the Proxy Card. Attorneys, trustees,
executors, administrators, guardians and others signing
in representative capacity should designate their full
titles. If a corporation, please sign in full
corporate name by President or other authorized
officer. If a partnership, please sign in partnership
name by authorized person. Joint owners should each
sign.
Dated: , 2001
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Signature
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Signature
Votes must be indicated (x) in Black or Blue ink [X]