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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
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 ss. 240.14a-12
Jacksonville Bancorp, Inc.
(Name of Registrant as Specified in its Charter)
Not Applicable
(Name(s) of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
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previously. Identify the previous filing by registration statement number, or
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[LOGO OF JACKSONVILLE BANCORP INC.]
March 25, 2005
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
Jacksonville Bancorp, Inc., which will be held on Thursday, April 21, 2005,
beginning at 11:00 a.m., Eastern Time. The meeting will be held at The River
Club, 1 Independent Drive, Suite 3500, Jacksonville, Florida 32202. The purpose
of the meeting is to consider and vote upon the proposal explained in the notice
and the proxy statement.
A formal notice describing the business to come before the meeting, a proxy
statement, and a proxy card are enclosed. We have also enclosed our 2004 Annual
Report for your review, which contains detailed information concerning our 2004
financial performance and activities.
It is important that your shares be represented at the Annual Meeting. Whether
or not you plan to attend the Annual Meeting in person, please vote your shares
by completing, signing, and dating the enclosed proxy card, and returning it in
the postage paid envelope provided. If you later decide to attend the Annual
Meeting and vote in person, or if you wish to revoke your proxy for any reason
before the vote at the Annual Meeting, you may do so and your proxy will have no
further effect.
Sincerely,
/s/ Donald E. Roller
Donald E. Roller
Chairman of the Board
1
JACKSONVILLE BANCORP, INC.
100 North Laura Street, Suite 1000
Jacksonville, Florida 32202
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Holders of Common Stock:
Notice is hereby given that the Annual Meeting of Shareholders of Jacksonville
Bancorp, Inc. will be held on Thursday, April 21, 2005, at 11:00 a.m., Eastern
Time, at The River Club, 1 Independent Drive, Suite 3500, Jacksonville, Florida
32202 to consider and act upon the following matters:
1. Election of five of our directors; and
2. Such other business as may properly come before the Annual Meeting or
any adjournment(s) thereof.
Only shareholders of record of our common stock at the close of business on
March 18, 2005, are entitled to receive notice of, and to vote on, the business
that may come before the Annual Meeting.
Whether or not you plan to attend the meeting, please complete, sign, date, and
return the enclosed proxy card to our transfer agent as promptly as possible in
the postage paid envelope provided. You may revoke the proxy at any time before
it is exercised by following the instructions set forth in Voting of Proxies on
the first page of the accompanying proxy statement.
BY ORDER OF THE BOARD OF DIRECTORS
Price W. Schwenck
Corporate Secretary
March 25, 2005
2
JACKSONVILLE BANCORP, INC.
100 North Laura Street, Suite 1000
Jacksonville, Florida 32202
PROXY STATEMENT
Annual Meeting of Shareholders
This proxy statement and the accompanying notice and proxy card are being
furnished to you as a holder of Jacksonville Bancorp, Inc., common stock, $.01
par value, in connection with the solicitation of proxies by our Board of
Directors for use at the Annual Meeting of Shareholders. The Annual Meeting will
be held on Thursday, April 21, 2005, beginning at 11:00 a.m., Eastern Time, at
The River Club, 1 Independent Drive, Suite 3500, Jacksonville, Florida 32202.
This proxy statement, and the accompanying notice and proxy card, are first
being mailed to holders of our common stock on or about March 28, 2005.
Unless the context requires otherwise, references in this statement to "we",
"us", or "our" refer to Jacksonville Bancorp, Inc., its wholly owned subsidiary,
The Jacksonville Bank, and the Bank's wholly owned subsidiary, Fountain
Financial, Inc., on a consolidated basis. References to the "Company" denote
Jacksonville Bancorp, Inc., and The Jacksonville Bank is referred to as the
"Bank".
VOTING OF PROXIES
Shares represented by proxies properly signed and returned, unless subsequently
revoked, will be voted at the Annual Meeting in accordance with the instructions
marked on the proxy. If a proxy is signed and returned without indicating any
voting instructions, the shares represented by the proxy will be voted FOR
approval of the proposals stated in this proxy statement, and in the discretion
of the holders of the proxies on other matters that may properly come before the
Annual Meeting.
If you have executed and delivered a proxy, you may revoke such proxy at any
time before it is voted by attending the Annual Meeting and voting in person, by
giving written notice of revocation of the proxy, or by submitting a signed
proxy bearing a later date. Such notice of revocation or later proxy should be
sent to our transfer agent, SunTrust Bank Stock Transfer Department at the
address indicated on the enclosed proxy. In order for the notice of revocation
or later proxy to revoke the prior proxy, our transfer agent must receive such
notice or later proxy before the vote of shareholders at the Annual Meeting.
Unless you vote at the meeting or take other action, your attendance at the
Annual Meeting will not revoke your proxy.
VOTING PROCEDURES
Our bylaws provide that a majority of the outstanding shares entitled to vote
constitutes a quorum at a meeting of shareholders. Under the Florida Business
Corporation Act (the "Act") and our articles of incorporation, directors are
elected by a plurality of the votes cast in the election at a meeting at which a
quorum is present. Other matters are approved if affirmative votes cast by the
holders of the shares represented at a meeting at which a quorum is present
exceed votes opposing the action, unless the Act or our articles of
incorporation require a greater number of affirmative votes or voting by
classes. Abstentions and broker non-votes have no effect under Florida law.
VOTING SECURITIES
Our Board of Directors has fixed the close of business on March 18, 2005, as the
record date for determining the holders of our common stock entitled to receive
notice of, and to vote at, the Annual Meeting. At the close of business on March
18, 2005, there were issued and outstanding 1,709,166 shares of our common stock
entitled to vote at the Annual Meeting, held by approximately 180 registered
holders. You are entitled to one vote for each share held upon each matter
properly submitted at the Annual Meeting.
PURPOSE
We anticipate that our shareholders will act upon the following business at the
meeting:
PROPOSAL 1: ELECTION OF DIRECTORS
The directors nominated for election at the 2005 Annual Meeting are Rudolph A.
Kraft, R.C. Mills, Gilbert J. Pomar, III, Donald E. Roller and Charles F.
Spencer in Class 2. The term of office of the Class 3 directors expires at the
2006 Annual Meeting and the term of office of the Class 1 directors expires at
the 2007 Annual Meeting. Those directors elected as Class 2 directors at this
Annual Meeting will have a term of office of three years, expiring at the 2008
Annual Meeting.
If elected, the nominees will constitute 5 of the 14 members of our Board of
Directors. To be elected, each nominee must receive a plurality of the votes
cast, which shall be counted as described in Voting Procedures. Unless you mark
the accompanying proxy otherwise, the proxy will be voted FOR the election of
Messrs. Kraft, Mills, Pomar, Roller and Spencer. If any nominee should become
unable to serve, which is not now anticipated, the persons voting the
accompanying proxy may vote for a substitute in their discretion.
3
OUR BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE
NOMINEES.
Our articles of incorporation provide that our directors are divided into three
classes. The following provides certain information with respect to each of our
directors, including the nominees for director in Class 2. Except as otherwise
indicated, each person has been or was engaged in his present or last principal
occupation, in the same or a similar position, for more than five years.
Directors Carter, Healey, Kowkabany, Kraft, Mills, Rose, Schultz, Spencer,
Tavar, and Winfield became directors during our organizational period. Messrs.
Pomar and Schwenck were appointed to the Board in March 1999; Mr. Gottlieb was
appointed to the Board in July 1999; and Mr. Roller was appointed to the Board
in August 1999. All directors serve on the Boards of both the Company and the
Bank.
CLASS 2 DIRECTORS
POSITIONS HELD AND PRINCIPAL OCCUPATIONS
NAME AGE DURING THE PAST FIVE YEARS
- --------------------- ------ ---------------------------------------------
Rudolph A. Kraft 69 Director of Kraft Motorcar Company, Inc., in
Gainesville, Florida, a Mercedes-Benz, Jeep,
and Buick dealership since 1990. Mr. Kraft
is a Board member of the Jacksonville Marine
Institute and Trustee of the Lasell College
in Newton, Massachusetts. Mr. Kraft was
President and Chief Executive Officer of
Kraft Holdings, Inc., a Mercedes-Benz
dealership in south Florida from 1977 to
1998. He also served as a director to
Barnett Bank of South Florida from 1986 to
1989. Mr. Kraft has served on the boards of
a number of civic organizations.
R. C. Mills 67 President of Heritage Propane Partners,
L.P., a national distributor of propane gas.
Mr. Mills is a graduate of the University of
Sarasota and resides in the Jacksonville
area. Mr. Mills has an extensive business
background and is experienced in business
mergers and acquisitions, corporate finance,
and personnel management having served in
several executive management positions with
a vertically integrated oil and gas company
for over 25 years.
Gilbert J. Pomar, III 44 President and Chief Executive Officer for
both the Company and the Bank, Mr. Pomar
joined us in March 1999, having been
employed by First Union National Bank in
Jacksonville since 1991. During his tenure
with First Union, he was Senior Portfolio
Manager and Senior Vice President/
Commercial Banking Manager. Mr. Pomar has 22
years of banking experience, including four
years with Southeast Bank and four years
with First National Bank of Chicago. Mr.
Pomar is active in various community
efforts, including Board positions of the
American Cancer Society, University of North
Florida, College of Business, and the
Florida Bankers Association. He is a
graduate of the University of Florida, where
he earned his Bachelor of Science degree in
Finance.
Donald E. Roller 67 Chairman of our Board of Directors.
President and Chief Executive Officer of
U.S. Gypsum Company from 1993 through 1996.
He was also Executive Vice President of USG
Corporation. Mr. Roller has had much
experience in directorship positions; he
serves as a member of the Board and
Treasurer of Glenmoor at St. Johns, a not
for profit CCRC located in St. Augustine,
Florida, and has served as acting Chief
Executive Officer and Chairman of the Audit
Committee for Payless Cashways, Inc.
Charles F. Spencer 62 President of INOC LLC, a real estate
management development company, and Cottage
Street Land Trust, Inc., in Jacksonville,
Florida. In addition, Mr. Spencer is
Executive Vice President of the South
Atlantic and Gulf Coast District of I.L.A.
and Vice President at Large of the Florida
AFL-CIO. He serves as a member of the Board
of the Jacksonville Airport Authority, the
Jacksonville Propeller Club, the I.M.
Sulzbacher Center for the Homeless and
Edward Waters College. Mr. Spencer is the
former Chairman of the Board for the
Jacksonville Sports Development Authority,
appointed by the Mayor, and a former board
member of the United Way of Northeast
Florida, the Committee of 100 of the
Jacksonville Chamber of Commerce, and the
Florida Community College at Jacksonville
Foundation.
4
CLASS 3 DIRECTORS
POSITIONS HELD AND PRINCIPAL OCCUPATIONS
NAME AGE DURING THE PAST FIVE YEARS
- --------------------- ------ ---------------------------------------------
D. Michael Carter, 52 Certified Public Accountant and a graduate
C.P.A. of Florida State University. Mr. Carter has
lived in Jacksonville, Florida, since 1975,
and is Director and President of Carter &
Company CPA's, P.A., providing services to
tax and audit clients, including businesses,
business owners and executives, as well as
professionals. The practice also provides
financial and retirement planning,
investment and business counseling services.
Mr. Carter is President and Director of
Atlantic Capital Associates, Inc. Before
forming his firm of Carter & Company in
1980, Mr. Carter had been a public
accountant with two national accounting
firms. Mr. Carter is a member of the
American Institute of Certified Public
Accountants and the Florida Institute of
Certified Public Accountants. He is a member
of the Rotary Club of Oceanside in
Jacksonville Beach and is a member of the
Jacksonville Chamber of Commerce. Mr. Carter
has previously served as a Board member for
the Ronald McDonald House, Board member of
the Rotary Club of Oceanside, President of
the Rotary Club of East Arlington
(Jacksonville), President of the Mandarin
Business Association (Jacksonville), and
Board member of Leadership Jacksonville
Alumni, Inc.
Melvin Gottlieb 58 Chief Executive Officer of Martin Gottlieb &
Associates, LLC and Sterling Group Building
Inc. Past Chief Executive Officer of
Gottlieb's Financial Services, Inc., a
subsidiary of Medaphis Corporation, which
provides emergency physician reimbursement
services. Mr. Gottlieb is active in the
community, acting as President for the
Jacksonville Jewish Foundation; Vice
President for the Jacksonville Jewish
Center, River Garden Foundation, and Jewish
Community Alliance; and Chairman of the
University of North Florida Business
Advisory Council. Mr. Gottlieb also serves
as Director for numerous other charitable
organizations, including the I. M.
Sulzbacher Center for the Homeless, Dignity
U Wear, Jacksonville Jewish Federation,
Fresh Ministries, and Community Asthma
Partnership.
James M. Healey 47 Director, Vice President, and Partner of
Mint Magazine, Inc., Chattanooga Mint, Inc.,
Tennessee Mint, Inc., Columbia Mint, Inc.,
and Tampa Mint, Inc. direct mail advertising
firms. Before his association with Mint
Magazine began in 1985, Mr. Healey worked
with Carnation Food Products, Inc., and
International Harvester. Mr. Healey attended
Purdue University where he received a
Bachelor of Arts degree from Purdue's
Business School with special studies in
Marketing and Personnel. Mr. Healey has been
a resident and active member of the
Jacksonville community since 1984.
John C. Kowkabany 62 Jacksonville based real estate investor and
consultant. Mr. Kowkabany has significant
private and public sector experience. A
resident of the city of Neptune Beach, he
has been active in local government, serving
as the City's Mayor from 1989 to 1997, and
Councilman from 1985 to 1989. Mr.
Kowkabany's public sector experience has
provided him with experience and knowledge
regarding the local business and civic
communities. For many years, Mr. Kowkabany
has served with various civic and charitable
organizations as an officer or director. Mr.
Kowkabany graduated with a Bachelor of Arts
degree from Jacksonville University.
Bennett A. Tavar 47 Owner and President of Logical Business
Systems, Inc., a computer sales and service
firm located in Jacksonville, Florida. Mr.
Tavar has been a resident of Jacksonville
since 1982 and is active in a number of
local civic organizations.
CLASS 1 DIRECTORS
POSITIONS HELD AND PRINCIPAL OCCUPATIONS
NAME AGE DURING THE PAST FIVE YEARS
- --------------------- ------ ---------------------------------------------
John W. Rose 55 A financial services executive, advisor, and
investor for over 30 years. Mr. Rose is
President of McAllen Capital Partners, Inc.,
a financial advisory firm specializing in
bank and thrift turnarounds. Through those
activities, Mr. Rose has served as Executive
Vice President and Chief Financial Officer
of Bay View Capital Corp., an NYSE traded
bank holding company in California, and
Executive Vice President of F.N.B.
Corporation, an NYSE traded bank holding
company in Pennsylvania. Mr. Rose is
currently a director of Bay View Capital
Corp.; F.N.B. Corporation; Sun Bancorp, a
publicly traded bank holding company in
Pennsylvania; and Life Shelters Inc., a
finance company in Virginia. Mr. Rose earned
his undergraduate degree from Case Western
Reserve University and his M.B.A. from
Columbia University.
5
POSITIONS HELD AND PRINCIPAL OCCUPATIONS
NAME AGE DURING THE PAST FIVE YEARS
- --------------------- ------ ---------------------------------------------
John R. Schultz 41 A fourth generation native of Jacksonville,
Florida. Mr. Schultz is Chief Executive
Officer of Schultz Investments, an
investment management company primarily
involved in the development of shopping
centers and office buildings. Mr. Schultz is
a graduate of The Bolles School
(Jacksonville, Florida) and attended the
University of Florida. Mr. Schultz is a
director of numerous companies and community
organizations, including Southeast-Atlantic
Corporation (Canada Dry
bottler/distributor), Intrepid Capital
Management, an investment management
company, Jacksonville Museum of Science and
History, Metro YMCA, Daniel Properties,
Inc., St. Vincent's Foundation and The
Schultz Foundation, Inc.
Price W. Schwenck 62 Chief Executive Officer of the Company until
April 26, 2000, and Chairman of the Board of
Directors for the Bank. From May 2000 to
February 2003, Mr. Schwenck was President
and Chief Executive Officer of P.C.B.
Bancorp, Inc., n/k/a Colonial BancGroup,
Inc., a multi-bank holding company located
in Clearwater, Florida. Mr. Schwenck served
as Regional President for First Union
National Bank in Ft. Lauderdale, Florida,
from 1988 to 1994, and in Jacksonville,
Florida, from 1994 until he retired in 1999.
Mr. Schwenck received his Bachelors degree
and M.B.A. from the University of South
Florida and his M.S. from the University of
Miami.
Gary L. Winfield, M.D. 48 A physician. Dr. Winfield has had an active
family practice in Jacksonville Beach,
Florida, since 1989, operating as Sandcastle
Family Practice, P.A. Dr. Winfield has
served as Vice President of Medical Affairs
for Anthem Health Plans of Florida, a
provider of health insurance. Dr. Winfield
received his undergraduate degree from the
University of Oklahoma and is a graduate of
the College of Medicine at the University of
Oklahoma.
BOARD OF DIRECTORS, GOVERNANCE AND COMMITTEES
CORPORATE GOVERNANCE. The Board of Directors is committed to good business
practices, transparency in financial reporting, the highest level of corporate
governance and the highest ethical, moral and legal standards in the conduct of
its business and operations. We believe that these standards form the basis for
our reputation of integrity in the marketplace and are essential to our
efficiency and continued overall success.
COMMUNICATIONS WITH THE BOARD OF DIRECTORS. The Board has established a process
for shareholders to communicate with members of the Board. If you would like to
contact the Board, you can do so by forwarding your concern, question or
complaint to the Company's Corporate Secretary, Price W. Schwenck, at 100 North
Laura Street, Jacksonville, Florida 32202.
INDEPENDENCE. The Board of Directors has determined that 12 of its 14 members
are independent as defined by the National Association of Securities Dealers
listing standards.
MEETINGS. During 2004, the Board held 9 meetings, and all directors attended at
least 75% of the meetings of the Board and committees on which they served. Our
Board of Directors maintains an Audit Committee, a Compensation Committee, and a
Corporate Governance Committee, which are described below. Our Board elects the
members of these committees at the Board meeting immediately following the
Annual Meeting, and membership may change throughout the year based on varying
circumstances at the discretion of the Board. Under our bylaws, the Board of
Directors is authorized to fill any vacancy on a committee.
AUDIT COMMITTEE. The Audit Committee is responsible for the matters set forth in
its written charter which has been adopted by the Board of Directors, a copy of
which is attached to this proxy statement. The primary function of the Audit
Committee is to assist the Board of Directors in fulfilling its oversight
responsibilities by reviewing the Company's financial reports; systems of
internal controls regarding finance, accounting, legal compliance, and ethics
and evaluating the independence of the Company's independent accountants. The
Audit Committee held 4 meetings in 2004. The members of the Audit Committee are
D. Michael Carter, C.P.A. (Chairman), James M. Healey, John C. Kowkabany and
Charles F. Spencer. All members of the Audit Committee are independent as
defined by the National Association of Securities Dealers listing standards.
AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES. In accordance with the
Sarbanes-Oxley Act of 2002, the Audit Committee is required to pre-approve all
auditing services and permissible nonaudit services, including related fees and
terms, to be performed for the Company by its independent auditor, subject to
the de minimus exceptions for nonaudit services described under the Securities
Exchange Act of 1934 (the "Exchange Act") which are approved by the Audit
Committee prior to the completion of the audit. In 2004, the Audit Committee
pre-approved all services performed for the Company by the auditor.
AUDIT COMMITTEE FINANCIAL EXPERT. The Board of Directors has determined that D.
Michael Carter, C.P.A. is an audit committee financial expert. Mr. Carter is
independent as defined by the National Association of Securities Dealers listing
standards.
COMPENSATION COMMITTEE. The Compensation Committee, which was formed
in May 2002, is responsible for oversight of compensation matters, employment
issues, and personnel policies. The Committee makes recommendations to the Board
of Directors regarding compensation for the Chief Executive Officer, as well as
other executive officers and certain officers/managers, including salary,
bonuses, option grants, other forms of long-term compensation, and employee
benefits. Additionally, the Committee reviews general levels of compensation and
is responsible for evaluation of salaries and other compensation in light of
industry trends and the practices of similarly situated, publicly traded bank
holding companies. The Compensation Committee held four meetings in 2004. The
members are John W. Rose (Chairman), R.C. Mills, Donald E. Roller, Price W.
Schwenck, Charles F. Spencer and Gary L. Winfield, M.D.
6
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE. The Nominating and Corporate
Governance Committee, which was formed in March 2002, is responsible for
formulating policies governing the Board of Directors and its committees as set
out in its charter, a copy of which is attached to this proxy statement. The
responsibilities include recommending new Board members, establishing criteria
for membership on the Board, designating chairs and members of Board committees,
setting dates for Board meetings, monitoring compliance with our bylaws and
regulations governing public companies, and making recommendations regarding
director compensation. The Nominating and Corporate Governance Committee held
four meetings in 2004. The members of the Nominating and Corporate Governance
Committee are Bennett A. Tavar (Chairman), James M. Healey, Rudolph A. Kraft,
Donald E. Roller and John R. Schultz. All members of the Nominating and
Corporate Governance Committee are independent as defined by the National
Association of Securities Dealers listing standards. The Nominating Corporate
Governance Committee will consider candidates for Board seats recommended by our
shareholders. Written suggestions for nominees should be sent to the Corporate
Secretary, Price W. Schwenck, Jacksonville Bancorp, Inc., 100 North Laura
Street, Jacksonville, Florida 32202. Any such recommendation must include the
name and address of the candidate; a brief biographical description, including
the candidate's occupation for at least five years; a statement of the
qualifications of the candidate; and the candidate's signed consent to be named
in the proxy statement and to serve as director, if elected.
DIRECTOR FEES. Directors who are not employees of the Company received $4,800 in
2003 and $164,949 in 2004 for their services to the Company. Non-employee
directors currently participate in the Company's Directors Stock Purchase Plan
under which a director may designate all, or any part, of his compensation for
investment in the Company's stock. All non-employee directors elected to
designate all of this compensation for such investment, receiving 600 shares of
Company stock, except for Mr. Kraft who received 100% of his director fees in
cash.
EXECUTIVE COMPENSATION
EXECUTIVE OFFICERS OF THE REGISTRANT
The following, in addition to Mr. Pomar and Mr. Schwenck who serve as directors,
are our executive officers:
POSITIONS HELD AND PRINCIPAL OCCUPATIONS
NAME AGE DURING THE PAST FIVE YEARS
- --------------------- ------ ---------------------------------------------
Scott M. Hall 40 Executive Vice President and Senior Loan
Officer of the Bank. Mr. Hall has over 18
years of experience in the financial
services industry. Before joining the Bank,
he was employed with First Union National
Bank in Jacksonville for 8 years as Vice
President/Commercial Banking Relationship
Manager. His community activities include
the Jacksonville Chamber of Commerce and
Habitat for Humanity. He serves as a
director for the DYE-Clay YMCA. Mr. Hall is
a graduate of the University of North
Florida, where he received his Bachelor of
Business Administration degree in Finance.
Valerie A. Kendall 52 Executive Vice President and Chief Financial
Officer of the Holding Company and Bank. Ms.
Kendall's banking career spans more than 19
years. Prior to joining the Bank, she served
as Executive Vice President and Chief
Financial Officer of P.C.B. Bancorp, Inc.,
n/k/a Colonial BancGroup, Inc., a $650
million multi-bank holding company based in
Clearwater, Florida. She also held senior
finance positions with AmSouth Bank, Barnett
Banks (Bank of America) and SunTrust. Ms.
Kendall received her Bachelor of Science
degree in Accounting from Florida Southern
College and is a Certified Public
Accountant.
7
SUMMARY COMPENSATION TABLE (1)
The following table sets forth for the fiscal years ended December 31, 2004,
2003 and 2002, the cash compensation paid or accrued, as well as certain other
compensation paid or accrued for those years, for services in all capacities to
our Chairman, Chief Executive Officer, Chief Financial Officer and the Senior
Loan Officer of the Bank.
Annual Compensation
---------------------- Other Annual All Other
Name and Principal Position Year Salary ($) Bonus ($) Compensation($)(2) Compensation ($)(3)
- --------------------------------------------- ---- ---------- --------- ------------------ -------------------
Price W. Schwenck, Chairman 2004 100,000 41,372 -- --
2003 100,000 -- -- --
2002 -- -- -- --
--
Gilbert J. Pomar, III, President and Chief 2004 148,000 67,000 -- 13,000
Executive Officer 2003 141,000 69,000 -- 12,000
2002 135,167 55,000 10,182
Scott M. Hall, Executive Vice President and 2004 125,000 40,000 100 7,895
Senior Loan Officer of the Bank 2003 110,950 40,000 250 8,838
2002 104,967 30,000 -- 6,555
Valerie A. Kendall, Executive Vice President 2004 125,000 25,000 -- --
and Chief Financial Officer(4) 2003 -- -- -- --
2002 -- -- -- --
(1) Columns relating to Long Term Compensation Awards, and LTIP Payouts, have
been deleted because no compensation required to be reported in such
columns was awarded to, earned by, or paid to the named executives during
the periods indicated. Perquisites are not disclosed because the aggregate
value does not exceed the lesser of $50,000 or 10% of total annual salary
and bonus.
(2) The amount shown in the Other Annual Compensation column consists of
commissions.
(3) The amounts shown in the All Other Compensation column consist of matching
contributions to the 401(k) plan.
(4) Valerie Kendall commenced her employment with us on May 24, 2004.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Number of Securities Percent of Total
Underlying Options/SARs Options/SARs Granted To Exercise of Base
Name Granted (#) Employees in Fiscal Year Price ($/Sh) Expiration Date
- ------------------------ ----------------------- ------------------------ ---------------- ---------------
Price W. Schwenck -- -- -- --
Gilbert J. Pomar, III 10,000 21.5% 23.25 2014
Scott M. Hall 7,500 16.1% 23.25 2014
Valerie A. Kendall 15,000 32.3% 23.25 2014
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION VALUES
The following table sets forth information regarding stock options exercised in
2004 by each of the named executive officers and the value of the unexercised
options held by these individuals as of December 31, 2004, based on the market
value ($26.95) of the common stock on December 31, 2004 on the Nasdaq SmallCap
Market.
Number of Securities Underlying Value of Unexercised In The
Unexercised Options at 12/31/04 Money Options at 12/31/04
Shares Acquired Value -------------------------------- ---------------------------
Name on Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
- ---------------------------------------- ------------ -------------------------------- ---------------------------
Price W. Schwenck -- -- 4,641/------- $78,665/$-0-
Gilbert J. Pomar, III -- -- 33,000/22,000 $551,700/$209,800
Scott M. Hall -- -- 13,500/11,500 $226,275/$ 85,350
Valerie A. Kendall -- -- -0-/15,000 $-0-/$ 55,500
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has granted loans to and accepted deposits from its executive
officers, directors and their affiliates in the ordinary course of business, on
substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions with other customers, and
which did not involve more than the normal risk of collectibility or present
other unfavorable features.
8
EQUITY COMPENSATION PLAN INFORMATION
Number of securities to be issued upon Weighted average exercise Number of securities
exercise of outstanding options, price of outstanding options, remaining available for
Plan Category warrants and rights warrants and rights future issuance
- ---------------------------- -------------------------------------- ----------------------------- -----------------------
Equity compensation plans 196,857 $ 13.50 43,098
approved by security
holders
Equity compensation plans
not approved by security
holders
-------------------------------------- ----------------------------- -----------------------
Total 196,857 $ 13.50 43,098
-------------------------------------- ----------------------------- -----------------------
EMPLOYMENT AGREEMENTS
Gilbert J. Pomar, III. Under our employment agreement with Gilbert J. Pomar,
III, (the "Pomar Agreement"), he became the Bank's President in March 1999 at a
salary of $120,000. He has since been promoted to become our CEO, and his base
salary has increased annually. Mr. Pomar's salary was increased from $148,000 to
$160,000 effective March 15, 2005, based on the evaluation of performance
factors by the Compensation Committee. Further, Mr. Pomar was granted a bonus of
$67,000 in March 2005 relative to 2004 performance. The Pomar Agreement provides
for an annual base salary plus annual increases and participation in bonus
plans, stock option plans, stock ownership plans, profit sharing plans, and
401(k) plans made available to our employees and executives. Additionally, we
pay Mr. Pomar's medical and dental insurance plan premiums. The Pomar Agreement
has a rolling one-year term, ending no later than Mr. Pomar's 65th birthday, and
contains a six-month noncompetition provision against employment with any person
seeking to organize a financial institution in Duval or Clay counties.
If we terminate Mr. Pomar's employment for a reason other than for "just cause"
(as defined in the Pomar Agreement), death or disability, or if Mr. Pomar
terminates his employment for "good reason" (as defined), then we must pay Mr.
Pomar an amount equal to his annual base salary and any bonus to which he would
have been entitled under the Pomar Agreement. If Mr. Pomar's employment is
terminated as a result of a "change in control" (as defined) or a change in
control occurs within 12 months of his involuntary termination or termination
for good reason, then Mr. Pomar is entitled to a severance payment equal to 2.99
times his current annual base salary plus any incentive compensation to which he
was entitled under the Pomar Agreement. These payments will be made in
substantially equal semi-monthly installments until paid in full. In addition,
upon a change in control, all unvested options will vest on the day before the
effective date of the change in control. Furthermore, unless Mr. Pomar is
terminated for just cause, under certain banking regulatory requirements or
under a termination of employment by Mr. Pomar for other than good reason, we
are also required to maintain in full force and effect all employee benefit
plans in which Mr. Pomar was participating before termination for the remainder
of the Pomar Agreement or 12 months, whichever is shorter. The Pomar Agreement
also contains provisions required under certain banking regulations that suspend
or terminate the Pomar Agreement upon certain banking regulatory findings or
actions.
Scott M. Hall. Under our employment agreement with Scott M. Hall (the "Hall
Agreement"), he became the Bank's Senior Loan Officer on January 1, 2003 at an
annual salary of $112,000. Mr. Hall's salary was increased from $125,000 to
$130,000 effective March 15, 2005. Mr. Hall was granted a bonus of $40,000 in
2005 relative to 2004 performance. The Hall Agreement provides for an annual
base salary plus incentive compensation and participation in bonus plans, stock
option plans, stock ownership plans, profit sharing plans, and 401(k) plans made
available to our employees and executives. Additionally, we pay Mr. Hall's
medical and dental insurance plan premiums. The Hall Agreement has a rolling
one-year term, ending no later than Mr. Hall's 65th birthday, and contains a
12-month noncompetition provision against employment with any person seeking to
organize a financial institution in Duval or Clay counties; however, such
provision is limited to a three-month period if Mr. Hall is terminated due to a
change in control.
If we terminate Mr. Hall's employment for a reason other than for "just cause"
(as defined in the Hall Agreement) or Mr. Hall terminates his employment for
"good reason" (as defined), then we must pay an amount equal to his annual base
salary and any incentive compensation or bonus to which he would have been
entitled under the Hall Agreement. If Mr. Hall's employment is terminated as a
result of a "change in control" (as defined) or said change occurs within 12
months of his involuntary termination or termination for good reason, then Mr.
Hall is entitled to a severance payment equal to 300% of the highest annual
salary and bonus he was paid or entitled to in the two years preceding
termination. These payments will be made in substantially equal semi-monthly
installments until paid in full. In addition, upon a termination for a change in
control we are also required to maintain in full force and effect all employee
benefit plans in which Mr. Hall was participating before termination for the
remainder of the Hall Agreement or 12 months, whichever is shorter.
AUDIT COMMITTEE REPORT
As set forth in its charter, the Audit Committee assists the Board by reviewing
financial reports we provide to governmental bodies or the public, monitoring
the adequacy of our internal controls regarding finance and accounting,
reviewing our auditing, accounting, and financial reporting processes generally,
and verifying the independence of our independent auditors. All auditors
employed or engaged by us report directly to the Audit Committee. To fulfill its
responsibilities, the Audit Committee recommends the selection of auditors,
reviews an annual risk assessment to ensure sufficient audit coverage and
reviews all reports of auditors and examiners, as well as management's responses
to such reports, to ensure the effectiveness of internal controls and the
implementation of remedial action. The Audit Committee also recommends to the
Board whether to include the audited financial statements in our Annual Report
and Form 10-KSB.
9
In discharging its oversight responsibility as to the audit process, the Audit
Committee obtained from the independent auditors a formal written statement
describing their relationships with us that might bear on their independence,
consistent with Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees; discussed any relationships that may impact
their objectivity and independence with the auditors; considered whether the
provision of nonaudit services was compatible with maintaining the auditors'
independence; and satisfied itself as to their independence. The Audit Committee
also discussed with management and the independent auditors the quality and
adequacy of our internal controls, and the accounting function's organization,
responsibilities, budget, and staffing. The Audit Committee further reviewed
with the independent auditors their audit plans, audit scope, and identification
of audit risks.
The Audit Committee discussed with the independent auditors all communications
required by generally accepted auditing standards, including those described in
Statement on Auditing Standards No. 61, as amended, Communication with Audit
Committees, and with and without management present, discussed and reviewed the
results of the independent auditors' examination of the financial statements.
The Audit Committee reviewed and discussed our audited financial statements as
of and for the year ended December 31, 2004, with management and the independent
auditors. Management has the responsibility for preparation of our financial
statements, and the independent auditors have the responsibility for examination
of those statements. Based on this review and the discussions with management
and the independent auditors, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in our Annual Report
and Form 10-KSB for the year ended December 31, 2004, for filing with the SEC.
All members of the Audit Committee are independent directors as defined by the
National Association of Securities Dealers.
D. Michael Carter, C.P.A. (Chairman) John C. Kowkabany
James M. Healey Charles F. Spencer
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS AND CERTAIN BENEFICIAL OWNERS
The following table indicates the common stock beneficially owned, as of March
18, 2005, by our executive officers and directors, by each person known by us to
own beneficially more than 5% of the common stock of the Company, and all our
executive officers and directors as a group:
AMOUNT AND NATURE OF PERCENT OF SHARES OF
DIRECTOR OR EXECUTIVE OFFICER BENEFICIAL OWNERSHIP (1) COMMON STOCK OUTSTANDING
- ---------------------------------------------------------- ------------------------ -----------------------
D. Michael Carter, C.P.A. 34,918 2.04%
Melvin Gottlieb 64,193 3.76%
Scott M. Hall 13,500 0.79%
James M. Healey 37,600 2.20%
Valerie A. Kendall --- ---
John C. Kowkabany 38,443 2.25%
Rudolph A. Kraft 40,768 2.39%
R. C. Mills 88,593 5.18%
Gilbert J. Pomar, III 38,000 2.22%
Donald E. Roller 48,593 2.84%
John W. Rose 72,143 4.22%
John R. Schultz 42,918 2.51%
Price W. Schwenck 30,241 1.77%
Charles F. Spencer 21,143 1.24%
Bennett A. Tavar 41,943 2.45%
Gary L. Winfield, M.D 34,593 2.02%
All executive officers and directors as a group (16 persons) 647,589 37.88%
All executive officers and directors as a group (16 persons)
(1) Under the rules of the SEC, the determinations of "beneficial ownership" of
our common stock are based upon Rule 13d-3 under the Exchange Act. Under
this Rule, shares will be deemed to be "beneficially owned" where a person
has, either solely or with others, the power to vote or to direct the
voting of shares and/or the power to dispose, or to direct the disposition
of shares, or where a person has the right to acquire any such power within
60 days after the date such beneficial ownership is determined. Shares of
our common stock that a beneficial owner has the right to acquire within 60
days under the exercise of the options or warrants are deemed to be
outstanding for the purpose of computing the percentage ownership of such
owner but are not deemed outstanding for the purpose of computing the
percentage ownership of any other person. All amounts are determined as of
March 18, 2005, when there were 1,709,166 shares outstanding. The amounts
shown above include4,643 options exercisable within 60 days of March 18,
2005, for each director other than Mr. Pomar, whose beneficial ownership
includes options to purchase 33,000 shares, and Mr. Schwenck, whose
beneficial ownership includes options to purchase 4,641 shares. The amount
shown for Mr. Hall includes options to purchase13,500 shares, and for all
directors and officers as a group, options to purchase 124,357 shares.
Unless otherwise noted, all shares are held directly by the director or
executive officer, or, in some cases, by their family members sharing the
same household.
10
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Exchange Act requires our executive officers and directors, and any persons
owning more than 10 percent of a class of our stock, to file certain reports on
ownership and changes in ownership with the SEC. During 2004, our executive
officers and directors filed on a timely basis all reports required by Section
16(a) of the Exchange Act relating to transactions involving our equity
securities beneficially owned by them except that each of Messrs. Kowkabany,
Rose, Mills, Winfield, Gottlieb filed four late reports, Messrs. Carter, Tavar,
Spencer, Schultz, Roller, Healey and Pomar filed three late reports, and Messrs.
Schwenck and Hall and Ms. Kendall filed two late reports.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
The firm of Crowe Chizek and Company LLC ("Crowe Chizek") served as our
independent accountants for the fiscal year ending December 31, 2004.
Representatives of Crowe Chizek will be present at the Annual Meeting, will have
an opportunity to make a statement, if they desire to do so, and will be
available to respond to appropriate questions.
AUDIT FEES
2004 2003
-------- --------
Audit Fees (1) $ 54,750 $ 33,000
Audit Related Fees (2) $ 3,395 $ -0-
Tax Fees (3) $ 6,333 $ 4,000
All Other Fees (4) $ 4,000 $ -0-
-------- --------
Total $ 68,478 $ 37,000
-------- --------
(1) Audit fees consisted of audit work performed in the preparation and review
of the Company's financial statements and for quarterly and annual review
of Forms 10-Q and Form 10-KSB.
(2) Audit related fees consisted of fees for assurance and related services
performed that are reasonably related to the performance of the audit or
review of the Company's financial statements. This includes consulting on
financial accounting/reporting standards.
(3) Tax fees consisted principally of assistance related to tax compliance
reporting.
(4) Fees for products and services other than those already reported.
As disclosed in the Company's Current Report on Form 8-K ("Form 8-K") filed with
the Securities and Exchange Commission ("SEC") on May 5, 2004, on April 30,
2004, Hacker, Johnson & Smith PA was advised that the firm's services as
auditors of the Company were terminated. The Company engaged Crowe Chizek to
serve as its principal independent accountant in auditing the Company's
financial statements and performing review of interim filings. The decision to
replace auditors was approved by the Company's Board of Directors, pursuant to
the recommendation of the Audit Committee.
The reports of Hacker, Johnson & Smith PA regarding the Company's financial
statements for the years ended December 31, 2003 and 2002, did not contain an
adverse opinion or a disclaimer of opinion, and were not modified as to
uncertainty, audit scope, or accounting principles, nor was there any event of
the type requiring disclosure under Item 304(a)(1)(iv) of Regulation S-B.
In connection with the audits of the Company's consolidated financial statements
for the years ended December 31, 2003 and 2002, there were no disagreements with
Hacker, Johnson & Smith PA on any matters of accounting principles or practices,
financial statement disclosure, or auditing scope and procedures which, if not
resolved to the satisfaction of Hacker, Johnson & Smith PA, would have caused
Hacker, Johnson & Smith PA to make reference to the matter in their report.
Prior to the filing of the Form 8-K with the SEC, the Company provided Hacker,
Johnson & Smith PA with a copy of the disclosures contained in the Form 8-K
which are the same disclosures contained herein, and requested that Hacker,
Johnson & Smith PA furnish a letter addressed to the SEC stating whether it
agreed with such statements. A copy of that letter, dated May 4, 2004, was filed
as Exhibit 16 to the Form 8-K.
As indicated above, the Company engaged Crowe Chizek to serve as its independent
auditors for the year ending December 31, 2004, and until such time as a
replacement auditor may be selected by the Company. Prior to the engagement of
Crowe Chizek to provide the identified services, the Company did not consult
Crowe Chizek regarding any matter requiring disclosure under Item 304(a)(2) of
Regulation S-B.
SHAREHOLDER PROPOSALS
Shareholders who wish to include a proposal in our proxy statement and form of
proxy relating to the 2006 Annual Meeting should deliver a written copy of their
proposal to our principal executive offices no later than November 25, 2005.
Proposals must comply with the SEC proxy rules relating to shareholder proposals
in order to be included in our proxy materials. Except for shareholder proposals
to be included in our proxy statement and form of proxy, the deadline for
nominations for director and other proposals made by a shareholder is February
8, 2006. We may solicit proxies in connection with next year's Annual Meeting
which confer discretionary
11
authority to vote on any shareholder proposals of which we do not receive notice
by February 8, 2006. Proposals should be directed to Price W. Schwenck,
Corporate Secretary, Jacksonville Bancorp, Inc., 100 North Laura Street,
Jacksonville, Florida, 32202.
ANNUAL REPORT; DELIVERY TO SHAREHOLDERS SHARING ADDRESS
We are providing a copy of our Annual Report for the fiscal year ended December
31, 2004, simultaneously with delivery of this proxy statement. You may obtain
additional copies of the Annual Report and/or the Annual Report on Form 10-KSB
filed with the SEC by writing to Glenna Riesterer, Assistant Corporate
Secretary, Jacksonville Bancorp, Inc., 100 North Laura Street, Jacksonville,
Florida, 32202.
We are delivering only one proxy statement and Annual Report to multiple
shareholders sharing an address unless we have received contrary instructions
from one or more of the shareholders. We will promptly deliver upon written or
oral request a separate copy of this proxy statement or the Annual Report to a
shareholder at a shared address to which a single copy was sent. If you are a
shareholder residing at a shared address and would like to request an additional
copy of the proxy statement or Annual Report now or with respect to future
mailings (or to request to receive only one copy of the proxy statement or
Annual Report if you are currently receiving multiple copies), please send your
request to Glenna Riesterer at the address noted above or call us at (904)
421-3040.
OTHER MATTERS
As of the date of this proxy statement, our Board of Directors does not
anticipate that other matters will be brought before the Annual Meeting. If,
however, other matters are properly brought before the Annual Meeting, the
persons appointed as proxies will have the discretion to vote or act thereon
according to their best judgment.
COST OF SOLICITATION
We will bear the cost of solicitation of proxies, including expenses in
connection with the preparation and mailing of this proxy statement. We will
solicit primarily through the mail, and our officers, directors, and employees
may solicit by personal interview, telephone, facsimile, or e-mail proxies.
These people will not receive additional compensation for such solicitations,
but we may reimburse them for their reasonable out-of-pocket expenses.
Holders of common stock are requested to complete, sign, and date the
accompanying proxy card and promptly return it to our transfer agent in the
enclosed addressed, postage paid envelope.
Price W. Schwenck
Corporate Secretary
Dated: March 18, 2005
12
Appendix A
Audit Committee Charter
13
Jacksonville Bancorp, Inc.
Audit Committee Charter
October 25, 2000
Statement of Purpose
The primary function of the Audit Committee is to assist the Board of Directors
in fulfilling its oversight responsibilities by reviewing:
o The financial reports and other financial information provided by the
Corporation to governmental bodies or the public.
o The Corporation's systems of internal controls regarding finance,
accounting, legal compliance, and ethics that management and the Board
have established.
o The independence of the Corporation's independent accountants.
o The Corporation's auditing, accounting and financial reporting
processes generally.
o Significant changes in the Corporation's capital structure, as may
relate to appropriate changes in internal controls, financial
statement accuracy, or compliance issues.
Consistent with these oversight responsibilities, the Audit Committee should
encourage continuous improvement of, and should foster adherence to, the
Corporation's policies, procedures, and practices at all levels. The Committee's
primary duties and responsibilities are to:
o Serve as an independent and objective party to monitor the
Corporation's financial reporting processes and internal control
systems.
o Review and appraise the audit efforts of the Corporation's independent
accountants and internal auditing function.
o Provide an open avenue of communication among the independent
accountants, financial and senior management, the internal auditing
function, and the Board of Directors.
o Communicate with senior management and the Board regarding the
assessment and evaluation of material aspects of financial and
strategic transactions and opportunities.
The Committee will primarily fulfill these responsibilities by carrying out the
activities enumerated below.
Organization
The Audit Committee shall consist of three or more directors, as determined by
the Board, each of whom shall be independent consistent with the requirements of
any exchange or interdealer quotation system upon which the Corporation may be
listed. All members of the Committee shall have a working familiarity with basic
finance and accounting practices and financial statements (including a balance
sheet, income statement, and cash flow statement). At least one member of the
Committee shall have accounting or related financial management expertise.
14
Jacksonville Bancorp, Inc.
Audit Committee Charter
October 25, 2000, Page 2
The members of the Committee shall be elected by the Board at the annual
organizational meeting of the Board to each serve a term of one year or until
their successors shall be duly elected and qualified. The Board will appoint a
Chair to preside at the Committee meetings and schedule meetings as appropriate.
MEETINGS
The Audit Committee will meet quarterly or at such times as requested by the
Chair, any two Committee members, the Chairman of the Board, Chief Executive
Officer, Chief Financial Officer, independent accountants, or the internal
auditors. The Chief Executive Officer, Chief Financial Officer, and
representatives of the internal audit firm or independent accountants shall be
invited as necessary. The Chair may excuse non-committee members and management
from attendance at any meeting or portion of any meeting.
As part of its job to foster open communication, the Committee should meet at
least quarterly with management, and annually with the independent accountants
in executive sessions to discuss matters that the Committee or any of these
groups believe should be discussed privately. In addition, the Committee Chair
should review the Corporation's financial statements quarterly, and meet with
the independent accountants as deemed necessary.
DUTIES AND RESPONSIBILITIES
To fulfill its duties and responsibilities the Audit Committee shall handle the
following areas:
Document and Report Review
. Review and update this Charter at least annually, as conditions
dictate.
. Review the Corporation's annual financial statements and any reports
or other financial information submitted to any governmental body or
the public, including any certification, report, opinion, or review
rendered by the independent accountants.
. Review the regular internal reports to management prepared by the
internal auditing firm and management's response thereto.
. Review the financial management and the independent accountants
quarterly reports on Form 10-Q prior to filing the quarterly release
of earnings. The Chair of the Committee may represent the entire
Committee for purposes of this review.
. Submit any reports as required by any exchange or interdealer
quotation system on which the Corporation may be listed.
15
Jacksonville Bancorp, Inc.
Audit Committee Charter
October 25, 2000, Page 3
Independent Accountants
. Recommend to the Board the selection of the independent accountants,
considering their independence and effectiveness, and approve the fees
and other compensation to be paid to the independent accountants.
. Review the performance of the independent accountants and approve any
proposed discharge of the independent accountants when warranted.
. Periodically consult privately with the independent accountants about
internal controls and the fullness and accuracy of financial
statements.
. Receive from the independent accountants, on a periodic basis, a
formal written statement delineating all relationships between the
independent accountants and the Corporation, consistent with
Independence Standards Board Standard Number 1, and take the
appropriate action to satisfy itself of the outside accountants'
independence.
Financial Reporting Processes
. In consultation with the independent accountants and the internal
auditors, review the integrity of the Corporation's financial
reporting processes, both internal and external.
. Consider the independent accountants' judgments about the quality and
appropriateness of the Corporation's accounting principles as applied
in its financial reporting.
. Consider and approve, if appropriate, major changes to the
Corporation's auditing and accounting principles and practices as
suggested by the independent accountants, management, or the internal
auditing department.
Process Improvement
. Establish regular and separate systems of reporting to the Audit
Committee by management, the independent accountants, and internal
auditors regarding any significant judgments made in management's
preparation of the financial statements and the view of each as to
appropriateness of such judgments.
. Following the completion of the annual audit, review separately with
management, the independent accountants, and the internal auditors any
significant difficulties encountered during the course of the audit,
including any restrictions on the scope of work or access to required
information.
. Review any significant disagreements among management and the
independent accountants or the internal auditors in connection with
the preparation of the financial statements.
16
Jacksonville Bancorp, Inc.
Audit Committee Charter
October 25, 2000, Page 4
. Review, at an appropriate time, with the independent accountants,
internal auditors, and management the extent to which changes or
improvements in financial or accounting practices, as approved by the
Committee, have been implemented.
Ethical and Legal Compliance
. Review periodically any Business Conduct policies and ensure that
systems have been established to enforce these policies.
. Review management's monitoring of the Corporation's compliance with
the Business Conduct Policy, and ensure that management has the proper
review system in place to ensure that the Corporation's financial
statements, reports, and other financial information disseminated to
governmental organizations and the public satisfy legal requirements.
. Review activities, organizational structure, and qualifications of the
internal audit firm as may be necessary in the selection and/or
retention of an appropriate firm.
. Review with the Corporation's counsel legal compliance matters
including the corporate securities trading policies.
. Review with the Corporation's counsel any legal matters that could
have a significant impact on the Corporation's financial statements.
. Perform any other activities consistent with this Charter, the
Corporation's Bylaws and governing law, as the Committee or the Board
deems necessary or appropriate.
While the Audit Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Audit Committee to plan or conduct audits or
to determine that the Corporation's financial statements are complete and
accurate and are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent accountants. Nor is
it the duty of the Audit Committee to conduct investigations, resolve
disagreements, if any, between management and the independent accountants or to
assure compliance with applicable laws, regulations, or the Corporation's
policies.
17
Appendix B
Nominating and Corporate Governance Committee Charter
18
JACKSONVILLE BANCORP, INC.
NOMINATING AND CORPORATE GOVERNANCE COMMITTEE CHARTER
1. Purpose. The primary purpose of the Nominating and Corporate Governance
Committee (the "Committee") of Jacksonville Bancorp, Inc. (the "Company")
is to (a) identify individuals who are qualified to serve on the Company's
Board of Directors (the "Board"), (b) recommend to the Board director
nominees for the next annual meeting of the shareholders and nominees to
fill vacancies on the Board, whether caused by retirement, resignation,
death, increase in the number of authorized directors or otherwise, and (c)
develop and recommend to the Board corporate governance principles
applicable to the Company and in accordance with all applicable laws,
rules, regulations and listing standards.
2. Membership. The Nominating and Corporate Governance Committee is a
committee of the Board. The Committee shall consist of a minimum of three
(3) independent directors as defined by the Board in accordance with all
applicable rules, regulations and agency listing standards.1
3. Appointment. The Board shall appoint the members of the Committee at the
annual meeting of the Board.
4. Vacancy. In the event a vacancy occurs on the Committee prior to the annual
meeting of the Board, the Board shall appoint a member to fill such vacancy
at such time.
5. Qualification. In appointing members to serve on the Committee, the Board
shall consider (a) the business and professional experience and background
of the member, (b) the member's knowledge of and familiarity with corporate
governance principles, (c) the member's understanding of the business and
operations of the Company, and (d) any other criteria or factors that the
Board, in its discretion, shall deem to be relevant to the purpose and the
fulfillment of the duties and responsibilities of the Committee.
6. Term. The Board shall determine, in its discretion, the term of membership
of the Committee.
7. Chair. Unless the Board elects a Chair of the Committee, the Committee may,
in its discretion, designate a Chair by an affirmative vote of the majority
of the members of the Committee.
8. Resignation; Removal. Any Committee member may resign from the Committee
upon notice to the Chair of the Board. The Board may remove any member of
the Committee at any such time the Board determines, in its reasonable
judgment, that (a) such member no longer meets the qualification standard
set forth in Section 5 of this Charter, or (b) it is in the best interest
of the company or its shareholders to remove such member from the
Committee.
9. Meetings. The Committee shall meet at least twice annually or more
frequently, as may be necessary or appropriate to carry out its
responsibilities. Meetings may be called by the Chair of the committee, by
any two members of the Committee or by the Chair of the Board. All meetings
of the committee shall be held pursuant to the bylaws of the Company with
regard to notice and waiver thereof, and written minutes of each meeting
shall be duly filed in the Company records. Reports of meeting of the
Committee shall be made to the Board at its next regularly scheduled
meeting following the Committee meeting and shall be accompanied by any
recommendations to the Board approved by the Committee.
10. Quorum. A majority of the members of the committee will constitute a quorum
for the transaction of business. The Committee may act by unanimous written
consent in accordance with applicable law.
11. Evaluation. The Board shall perform and conduct an annual performance
evaluation of the Committee to determine and assess whether the Committee
is fulfilling all of its duties and responsibilities hereunder and under
all applicable laws, rules, regulations, and listing standards. In
performing this evaluation, the
- ----------
/1/ NASDAQ requires independent director approval of director nominations,
either by an independent nominating committee or by a majority of the
independent directors. A single non-independent director would be permitted to
serve on an independent nominating committee if the individual is an officer who
owns or controls more than 20% of the voting securities or under an "exceptional
and limited circumstances" exception.
19
Board will solicit input from the Committee members, other Board members
and as appropriate, management of the Company and review the results of the
evaluation with the Committee.
12. Authority. The Committee shall have the sole and direct authority to
engage, retain, approve payment of compensation to, and terminate any
director search firm retained to identify and recommend possible candidates
for Board membership. The Committee is authorized to obtain advice and
assistance as it believes necessary from corporate personnel and from
external legal, accounting and other advisors.
13. Duties and Responsibilities. The Committee shall have the duty and
responsibility to carry out the following:
Directors:
(a) Establish the criteria for the selection of new directors. In carrying
out this responsibility, the Committee will at least annually (i)
assess the appropriate skills and characteristics required of Board
members in the context of the current make-up of the Board and the
needs of the Company, and (ii) consider principles to be applied in
filling vacancies and planning for Board succession;
(b) Periodically assess in connection with re-nomination recommendations
the performance of incumbent directors based on appropriate criteria,
which may include: (i) degree of understanding of strategies and
businesses, (ii) degree of preparedness with respect to Board
materials and issues, (iii) level of active, objective and
constructive participation in meetings of the Board and committees,
(iv) degree of understanding of general economic trends and corporate
governance, (v) level of support of Company initiatives relating to
customers and suppliers, (vi) quality of guidance with respect to the
Company's strategic and operating plans, (vii) level of involvement in
selecting, motivating, evaluating and compensating the CEO, and (viii)
level of involvement in representing the Company to the outside world;
(c) Consider and make recommendations to the Board regarding shareholder
nominations for directors that are submitted in accordance with the
Company's by-laws and applicable law;
(d) Make recommendations to the Board concerning the size and composition
of the Board subject to the Company's by-laws and articles of
incorporation;
(e) Develop a pool of potential director candidates for consideration in
the event of a vacancy in the Board;
(f) Recommend to the Board directors to serve as chairs and members of
other Board committees, monitor the functions of all standing Board
committees, and make recommendations to the Board regarding the
functions of such other committees;
(g) Make recommendations to the Board regarding fringe benefits to be
provided by the Company to any directors or officers of the Company;
(h) Review and recommend to the Board the compensation of directors;
(i) Recommend to the Board (i) the Company's policy on director tenure and
retirement, (ii) any amendment, termination or waiver of the policy,
and (iii) whether or not the Board should approve the withdrawal of
any resignation submitted by a director in accordance with the policy;
(j) Conduct, or engage one or more third parties to conduct, the
appropriate and necessary inquiries into the backgrounds, experience
and qualifications of possible candidates to serve on the Board;
20
(k) Lead the process to evaluate, at least annually, the performance of
the Board in the exercise of its oversight responsibilities,
soliciting input from all members of the Board and, as appropriate,
from management of the Company and review the results of the
evaluation with the Board;
(l) Review the status of each member of the Board and make recommendations
to the Board with respect to the Board's determination of whether
Board members meet the independence requirements of any and all
applicable rules, regulations and listing standards;
(m) Review annually the number of Board positions held by each Director to
ensure sufficient attention is being given to Company matters and to
establish criteria for avoiding related party conflicts;
(n) Monitor Board and Committee attendance with the expectation that each
director will attend at least seventy-five percent (75%) of all
meetings;
Executives:
(o) Receive periodically from the Chief Executive Officer his or her
recommendations regarding a successor, the development of other
executive talent and the executive management needs of the company;
(p) Review periodically with the Chair of the Board and the Chief
Executive Officer the succession plans for senior executive officers
and make recommendations to the Board regarding the selection of
individuals to occupy these positions;
Governance:
(q) Review and recommend, on a regular basis, changes to the Company's
corporate governance guidelines, including conflict of interest and
Related Party transaction policies, code of conduct for financial
officers, and code of business conduct and ethics;
(r) Review the adequacy of the Company's compliance policies and programs
in such areas as antitrust laws, securities laws, confidential
information, environmental protection, employee health and safety,
patent and copyright laws, and discrimination and harassment
(including equal employment opportunity);
(s) Review periodically with the Company's general counsel, new
legislation, regulations, and other developments, the Company's legal
compliance policy and make recommendations to the Board for any
changes, amendments and modifications to these policies that the
Committee shall deem desirable;
Committee:
(t) Review and update this Charter periodically, at least annually, as may
be necessary or appropriate;
(u) Report, on a periodic basis, to the Board regarding compliance with
this Charter, the activities of the Committee and any issues with
respect to the duties and responsibilities of the Committee; and
(v) Perform any other activities consistent with this Charter, the
Company's by-laws and all applicable laws, rules, regulations and
listing standards, as the Committee deems necessary or appropriate.
The foregoing Charter of the Nominating and Corporate Governance Committee
of the Board of Directors of Jacksonville Bancorp, Inc., was adopted by the
Nominating and Corporate Governance Committee on the 27th day of May, 2003, and
approved by the Board of Directors on the 4th day of June, 2003.
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Jacksonville Bancorp, Inc.
By:
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Its:
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22
JACKSONVILLE BANCORP, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
I, the undersigned shareholder of Jacksonville Bancorp, Inc. (the "Company"),
Jacksonville, Florida, do hereby nominate, constitute and appoint Valerie A.
Kendall and Scott M. Hall, or any one or more of them, my true and lawful proxy
and attorney(s) with full power of substitution for me and in my name, place and
stead, to represent and vote all of the common stock, par value $.01 per share,
of the Company, held in my name on its books as of March 18, 2005, at the Annual
Meeting of Shareholders to be held on Thursday, April 21, 2005.
PROPOSAL 1. Election of the following Directors:
[ ] FOR all nominees listed below (except as marked to the contrary below)
[ ] WITHHOLD Authority to vote for all nominees listed below
Rudolph A. Kraft R.C. Mills Gilbert J. Pomar, III
Donald E. Roller Charles F. Spencer
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the name(s) of such nominee(s) below.)
- ----------------------------------- --------------------------------------
- ----------------------------------- --------------------------------------
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR"
THE ELECTION OF EACH OF THE NOMINEES.
In their discretion, the proxies are authorized to vote upon such other business
as may properly come before the Annual Meeting of Shareholders.
IMPORTANT: PLEASE SIGN AND DATE ON REVERSE
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, the proxy
will be voted FOR Proposal 1. Should any other matter requiring a vote of
the shareholders arise, the proxies named above are authorized to vote in
accordance with their best judgment in the interest of the Company.
IMPORTANT: Please sign exactly as your name appears hereon. When shares are
held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee, or guardian, please give full title as
such. If a corporation, please sign the full corporate name by president or
other authorized officer. If a partnership, please sign in partnership name
by authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY PROMPTLY USING THE ENCLOSED
ADDRESSED ENVELOPE OR OTHERWISE TO SunTrust Bank Stock Transfer Department,
P.O. Box 4625, Atlanta, Georgia, 30302. IF YOU DO NOT SIGN AND RETURN A
PROXY OR ATTEND THE MEETING AND VOTE, YOUR SHARES CANNOT BE VOTED.
Dated: ____________________, 2005
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Signature
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Signature (if held jointly)
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Print Name(s) Here