FIRST LANDMARK BANK 307 N. Marietta Parkway Marietta, Georgia (770) April 10, 2015

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1 FIRST LANDMARK BANK 307 N. Marietta Parkway Marietta, Georgia (770) April 10, 2015 Dear Shareholder: You are cordially invited to attend the annual meeting of shareholders of First Landmark Bank, or the Bank, which will be held at 307 N. Marietta Parkway, Marietta, Georgia on Wednesday, May 20, 2015, at 10:00 a.m. local time. The purpose of the meeting is (1) to elect eleven directors of the Bank to serve for a term of one year; (2) to approve the Agreement and Plan of Share Exchange, or the Agreement, dated March 27, 2015, between the Bank and Landmark Bancshares, Inc., or the Company; (3) to approve the First Landmark Bank 2015 Long-Term Incentive Plan, or the Long-Term Incentive Plan; and (4) to transact any other business as may properly come before the meeting or any adjournments thereof. The Agreement provides for the reorganization of the Bank into a holding company structure, with the Company becoming the holding company for and the sole shareholder of the Bank. The reorganization will occur through the exchange of all of the outstanding shares of Bank common stock for the same number of shares of Company common stock. Except for shares held by shareholders who exercise their dissenters rights, each outstanding share of Bank common stock will be exchanged for one share of Company common stock. Except for those shareholders who exercise their dissenters rights and receive a payment of cash for their shares, we do not expect our shareholders to recognize any gain or loss for U.S. federal income tax purposes as a result of the reorganization. The attached notice of the annual meeting and proxy statement describe the formal business to be transacted at the meeting. Whether or not you expect to be present at the meeting, please mark, date and sign the enclosed proxy and return it to us in the envelope provided as soon as possible. If you attend the meeting, you may withdraw your proxy and vote your own shares. If you have any questions concerning the Bank, or if we can be of assistance with any banking matter, please do not hesitate to contact us. We look forward to seeing you soon. Sincerely, R. Stanley Kryder Terrence Y. DeWitt President and CEO Executive Vice President and CFO

2 FIRST LANDMARK BANK 307 N. Marietta Parkway Marietta, Georgia (770) NOTICE OF THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 20, 2015 The annual meeting of shareholders of First Landmark Bank, or the Bank, will be held on Wednesday, May 20, 2015, 10:00 a.m. local time, at 307 N. Marietta Parkway, Marietta, Georgia for the following purposes: (1) To elect eleven persons to serve as directors of the Bank for a one-year term expiring at the 2016 annual meeting; (2) To approve the Agreement and Plan of Share Exchange, or the Agreement, dated March 27, 2015, between the Bank and Landmark Bancshares, Inc., or the Company, attached hereto as Appendix A, which provides for the reorganization of the Bank into a holding company structure. (3) To approve the First Landmark Bank 2015 Long-Term Incentive Plan, or the Long-Term Incentive Plan; and (4) To transact any other business as may properly come before the meeting or any adjournments of the meeting. The Bank has set the close of business on April 1, 2015, as the record date for determining the shareholders who are entitled to notice of, and to vote at, the meeting. Approval of the Agreement requires the affirmative vote of at least two-thirds of the issued and outstanding shares of Bank common stock. Each Bank shareholder has the right to dissent from the transactions contemplated by the Agreement and to demand payment in cash of the fair value of his or her shares if the reorganization is consummated. The right of any shareholder to receive this payment is contingent upon strict compliance with the requirements of Article 13 of the Georgia Business Corporation Code. We have included the full text of Article 13, which describes the right to dissent, as Appendix B to the accompanying proxy statement/prospectus. We also discuss the right to dissent beginning on page 11 of the accompanying proxy statement/prospectus. The Board of Directors unanimously recommends that shareholders vote FOR the election of the directors, FOR approval of the Agreement, and FOR approval of the Long-Term Incentive Plan. Whether or not you plan to attend the meeting, we ask that you mark, date, sign and return the enclosed proxy as soon as possible. Promptly returning your proxy will help ensure the greatest number of shareholders are present at the meeting in person or by proxy. i

3 If you attend the meeting in person, you may revoke your proxy at the meeting and vote your shares in person. You may revoke your proxy at any time before the proxy is exercised. By Order of the Board of Directors, R. Stanley Kryder Terrence Y. DeWitt President and CEO Executive Vice President and CFO April 10, 2015 ii

4 NOTICE OF ANNUAL FINANCIAL STATEMENT First Landmark Bank has prepared an Annual Disclosure Statement in compliance with Section 350 of the Rules and Regulations of the Federal Deposit Insurance Corporation. A copy of the Annual Financial Statement with the Report of Independent Certified Public Accountants is available free of charge to any shareholder who requests a copy from the Bank. Please direct any such request to the attention of A. Renee White at the address or telephone number of the Bank s main office, as listed above. Additionally, shareholders may access the Bank s audited financial statements for 2014 by visiting and keying in FLB2014 as the password. iii

5 Time and Place of the Meeting FIRST LANDMARK BANK 307 N. Marietta Parkway Marietta, Georgia (770) PROXY STATEMENT FOR 2015 ANNUAL MEETING INTRODUCTION Our Board of Directors is furnishing this proxy statement in connection with its solicitation of proxies for use at the annual meeting of shareholders to be held on Wednesday, May 20, 2015, at 10:00 a.m. local time, at 307 N. Marietta Parkway, Marietta, Georgia and at any adjournments of the meeting. Record Date and Mailing Date The close of business on April 1, 2015, is the record date for the determination of shareholders entitled to notice of and to vote at the meeting. We first mailed this proxy statement and the accompanying proxy to shareholders on or about April 10, Number of Shares Outstanding As of the close of business on the record date, First Landmark Bank, or the Bank, had authorized 10,000,000 shares of common stock, $5.00 par value, of which 4,315,739 shares were issued and outstanding. Each issued and outstanding share of common stock is entitled to one vote on all matters presented at the meeting. Proposals To Be Considered VOTING AT THE ANNUAL MEETING Election of Directors. Shareholders will be asked to elect eleven persons to serve as directors for a one-year term. The persons nominated to serve as directors are described beginning on page 4. Approval of the Agreement and Plan of Share Exchange. Shareholders will be asked to approve the Agreement and Plan of Share Exchange, or the Agreement, dated March 27, 2015, between the Bank and Landmark Bancshares, Inc., or the Company, with the Company becoming the holding company for and the sole shareholder of the Bank. Approval of the Long-Term Incentive Plan. Shareholders will be asked to approve the First Landmark Bank 2015 Long-Term Incentive Plan, or the Long-Term Incentive Plan, which provides for a total of 250,000 shares available to be issued in a variety of forms of equity-based incentives and also allows for the award of long-term cash-based incentives. The Board of Directors recommends a vote FOR each of the above proposals. 1

6 Procedures for Voting by Proxy If you properly sign, return and do not revoke your proxy, the persons appointed as proxies will vote your shares according to the instructions you have specified on the proxy. If you sign and return your proxy but do not specify how the persons appointed as proxies are to vote your shares, your proxy will be voted FOR the election of the director nominees, FOR approval of the Agreement, FOR approval of the Long-Term Incentive Plan, and in the best judgment of the persons appointed as proxies as to all other matters properly brought before the meeting. If any nominee for election to the Board of Directors named in this proxy statement becomes unavailable for election for any reason, the proxy will be voted for a substitute nominee selected by the Board of Directors. You can revoke your proxy at any time before it is voted by delivering to A. Renee White, corporate secretary of the Bank, at the main office of the Bank located at 307 N. Marietta Parkway, Marietta, Georgia 30060, either a written revocation of the proxy or a duly executed proxy bearing a later date, or by attending the meeting and voting in person. Requirements for Shareholder Approval The holders of shares of the common stock of the Bank are entitled to one vote per share on all matters presented at the meeting for action by shareholders. A quorum will be present at the meeting if a majority of the outstanding shares of common stock is represented in person or by valid proxy. We will count abstentions and broker non-votes, which are described below, in determining whether a quorum exists. Abstentions. For the purpose of determining the presence of a quorum, a shareholder who is present in person or by proxy at the annual meeting and who abstains from voting on any or all proposals will be included in the number of shareholders present at the annual meeting. Abstentions do not count as proactive votes in favor of or against a given matter but have the effect of negative votes. Broker Non-Votes. Brokers who hold shares for the accounts of their clients may vote these shares either as directed by their clients or, if permitted by the exchange or other organization of which they are members, in their own discretion. Proxies that contain a broker vote on one or more proposals, but no vote on others, are referred to as broker non-votes with respect to the proposal(s) not voted upon. Broker non-votes are included in determining the presence of a quorum. A broker non-vote, however, does not count as a vote in favor of or against a particular proposal for which the broker has no discretionary voting authority. Broker non-votes have the effect of negative votes. Election of Directors. To be elected, a director nominee must receive the affirmative vote of a majority of the shares represented in person or by proxy at the annual meeting and more votes than any other nominee for the particular seat on the Board of Directors. As such, only those votes actually cast regarding the election of a director will be counted for purposes of determining whether a particular director nominee receives sufficient votes to be elected. Abstentions and broker non-votes will be counted in determining the minimum number of votes required for approval and will, therefore, have the effect of negative votes. A failure to attend the meeting in person or by proxy will have no effect on the vote to elect directors, assuming a quorum exists. At the present time we do not know of any competing nominees. Approval of Agreement. To approve the Agreement, shareholders holding at least two-thirds of the outstanding shares of Bank common stock must vote in favor of it. As a result, any action other than a vote in favor of the proposal including a vote against, an abstention, or a failure to submit a proxy will have the effect of a vote against the proposal. 2

7 Approval of Long-Term Incentive Plan. To approve the Long-Term Incentive Plan, shareholders holding a majority of the shares represented in person or by proxy at the annual meeting must vote in favor of it. As such, only those votes actually cast regarding the proposed Long-Term Incentive Plan will be counted for purposes of determining whether the Long-Term Incentive Plan receives sufficient votes to be elected. Abstentions and broker non-votes will be counted in determining the minimum number of votes required for approval and will, therefore, have the effect of negative votes. Approval of Other Matters. Approval of any other matter that may properly come before the annual meeting requires the affirmative vote of a majority of shares of common stock present in person or by proxy and entitled to vote on the matter. Abstentions and broker non-votes will be counted in determining the minimum number of votes required for approval and will, therefore, have the effect of negative votes. A failure to attend the meeting in person or by proxy will have no effect on the voting of any such matter. SOLICITATION OF PROXIES The Bank will pay the cost of the proxy solicitation. Our directors, officers and employees may, without additional compensation, solicit proxies by personal interview, telephone, fax or otherwise. If necessary, we may engage third party proxy solicitors. We will forward our proxy solicitation material to the beneficial owners of common stock held of record by brokerage firms or other custodians, nominees or fiduciaries and pay the associated costs directly. 3

8 PROPOSAL 1: ELECTION OF DIRECTORS The Board of Directors consists of eleven members, each of whom serves for a one-year term that expires at the annual meeting the following year and upon the election and qualification of the director s successor. The following table shows for each nominee: (a) his name, (b) how long he has been a director of the Bank, and (c) his title in regards to the Bank. All directors who joined the Board of Directors in 2014 joined as a result of the Bank s merger with Midtown Bank & Trust Company. Director Nominees The Board of Directors proposes that each nominee listed on the table below be elected as a director of the Bank and serve a term of one year or until his successor is elected and qualified at the 2016 annual meeting. Name Director Since Title Joseph D. Chipman, Jr Director, Vice Chairman Stephen D. Cole 2008 Director Terrence Y. DeWitt 2011 Director, EVP and CFO Bryan J. Fields 2014 Director Ronald H. Francis 2008 Director, Chairman D. Kimbrough King, Jr Director R. Stanley Kryder 2014 Director, President and CEO John H. Moore 2008 Director David B. Sinyard 2014 Director William D. Smith, Jr Director David B. Swales 2008 Director The Board of Directors recommends that you vote FOR the election of the nominees named above. 4

9 PROPOSAL 2: APPROVAL OF THE AGREEMENT AND PLAN OF SHARE EXCHANGE The following information describes the material terms and conditions of the reorganization. However, this description may not contain all of the information that is important to you. The Agreement and Plan of Share Exchange is attached to this proxy statement/prospectus as Appendix A and is incorporated in this proxy statement/prospectus by reference. You are urged to read the Appendices. The Agreement Under the terms of the Agreement, the Bank will become a wholly-owned subsidiary of the Company. Each share of Bank common stock issued and outstanding, excluding shares held by shareholders who perfect their dissenters rights, will be converted into and exchanged for the right to receive one share of Company common stock. After the share exchange, the Company will be the holding company for the Bank, and the Bank will be the Company s only significant asset. The Agreement was approved by the Board of Directors of the Bank on March 18, 2015, and by the Board of Directors and sole shareholder of the Company on March 27, Parties to the Agreement The Bank is a state bank organized and operating under the laws of the State of Georgia. Its main office is located in Marietta, Georgia. The Bank offers a broad range of banking and banking-related products and services. As of December 31, 2014, the Bank s total assets were approximately $434.0 million, its total deposits were approximately $349.4 million, and its total shareholders equity was approximately $50.4 million. The Company is a Georgia corporation organized to serve as the holding company for and the sole shareholder of the Bank. The Company was organized on March 25, As of the close of business on the record date, the Bank had authorized 10,000,000 shares of common stock, $5.00 par value, of which 4,315,739 shares were issued and outstanding. The Company s current sole shareholder is R. Stanley Kryder. The Bank will redeem, at cost, the one share of common stock issued to R. Stanley Kryder as part of its corporate organization. After the reorganization, each Bank shareholder who does not perfect his or her dissenters rights will hold the same number of shares of Company common stock that he or she held of Bank common stock prior to the reorganization. Terms of the Reorganization The Bank will be reorganized into a holding company structure by virtue of the share exchange described in the Agreement. All of the issued and outstanding shares of Bank common stock will be owned by the Company, with the exception of those shares held by shareholders who perfect their dissenters rights. Subject to the effects of shareholders exercising their dissenters rights, the reorganization will not change your relative equity ownership interest in the consolidated entity. The Bank s officers and directors will not change as a result of the reorganization. The directors of the Company following the reorganization will be the same as the current directors of the Bank. 5

10 Conversion of Stock On the effective date of the reorganization: each share of Bank common stock will be converted into one share of Company common stock, other than those shares with respect to which the holder exercises dissenters rights; each outstanding option to purchase shares of Bank common stock, whether or not then exercisable, will be converted into an option to purchase the same number of shares of Company common stock; the Company will redeem, at cost, the share of common stock it issued to R. Stanley Kryder as part of its corporate organization; and the Company will be entitled to receive a stock certificate from the Bank representing all of the issued and outstanding shares of Bank common stock. Failure to Surrender Stock Certificates Until the shareholder surrenders his or her Bank common stock certificate(s) to the Bank, or suitable arrangements are made to account for any lost, stolen or destroyed certificates according to our procedures, the shareholder will not be issued a certificate representing the shares of Company common stock that he or she is entitled to receive. Additionally, until the shareholder surrenders his or her Bank common stock certificate(s) to the Bank, or suitable arrangements are made to account for any lost, stolen or destroyed certificates, the shareholder will not be paid dividends or other distributions on the shares of Company common stock that he or she is entitled to receive; instead, we will hold any dividends or distributions, without interest, for the holder s account until he or she surrenders his or her Bank common stock certificate(s). For any former shareholders of Midtown Bank & Trust Company who have not exchanged their stock certificates for certificates representing Bank common stock, we encourage you to exchange such certificates as soon as possible. Reasons for the Reorganization The Bank s Board of Directors believes that the reorganization of the Bank into a holding company structure is in the best interests of the Bank and its shareholders for the following reasons: the Company will have greater corporate and regulatory flexibility than the Bank to raise capital, borrow money, and redeem stock under various circumstances; the Company may engage in a broader range of non-banking and financial activities than the Bank, either directly or through non-bank subsidiaries and affiliates; and we believe that the power and flexibility of a holding company structure will better enable the Bank and the Company to compete with other financial institutions in our market area and will place the Company in a better position for future growth. At the present time, neither the Bank nor the Company has any understanding or commitment to make acquisitions or to engage in new non-banking or financial activities. However, if the reorganization is approved, the Company will review opportunities from time to time for acquisitions and new activities to identify those that may be beneficial to the Company and its shareholders. 6

11 The Board of Directors of the Bank has unanimously approved the terms of the Agreement and recommends that shareholders of the Bank vote in favor of approval of the Agreement. Conditions to Completion of the Reorganization The completion of the reorganization depends upon satisfaction of the following conditions: the holders of at least two-thirds of the outstanding shares of Bank common stock must approve the Agreement; the number of shares held by shareholders who have perfected dissenters rights of appraisal must not make completion of the reorganization inadvisable; and the Company must receive the required regulatory approvals, and any waiting periods required by law must have passed. Effective Date of the Reorganization The share exchange and the reorganization of the Bank into a holding company structure will be effective upon the filing of articles of share exchange with the Georgia Secretary of State, which the Company will file after receipt of the necessary shareholder and regulatory approvals and after the satisfaction of the other conditions to the reorganization. We cannot assure you that we will obtain the necessary shareholder and regulatory approvals or that we will satisfy the other conditions to the reorganization. However, barring any unforeseen delays, we anticipate that the reorganization will be completed in the second or third quarter of Regulatory Approvals The consummation of the reorganization is subject to approval by the Board of Governors of the Federal Reserve System, or the Federal Reserve, and the Georgia Department of Banking and Finance, or the GDBF. The Bank will soon file the necessary regulatory applications, and we anticipate completion of the reorganization in the second or third quarter of Amendment and Termination of the Agreement The Bank and the Company may agree to amend the Agreement at any time before the reorganization is effective. However, no amendment may reduce the number of shares of Company common stock that Bank shareholders will receive in the reorganization without the approval of Bank shareholders. The Agreement may be terminated by the Bank or the Company if any of the following occurs: the number of shares of Bank common stock voted against the Agreement makes the transaction inadvisable in the opinion of the Board of Directors of the Bank or the Company; any lawsuit has been instituted or threatened relating to the proposed reorganization that makes completion of the reorganization inadvisable in the opinion of the Board of Directors of the Bank or the Company; 7

12 any of the conditions to completion of the reorganization have not been satisfied; or for any other reason, completion of the reorganization is deemed inadvisable in the opinion of the Board of Directors of the Bank or the Company. Assumption of the First Landmark Bank 2007 Stock Option Plan General. As a part of the reorganization, the Company will assume the First Landmark Bank 2007 Stock Option Plan, or the Stock Option Plan. The Company will assume all outstanding options that may have been granted under the Stock Option Plan prior to the reorganization. In addition, the Bank will amend the Stock Option Plan immediately prior to the reorganization to substitute the Company as the granting corporation that maintains the Stock Option Plan. The Bank will also amend the Stock Option Plan to substitute the Company s common stock as the stock issuable under the plan. The Compensation Committee of the Company s Board of Directors will administer any outstanding options granted under the Stock Option Plan. Following the reorganization, the Company will have the authority to grant new awards pursuant to the assumed Stock Option Plan and to act as the sponsor of the plan in all other respects. As the successor granting corporation, the Company, by action of its Board of Directors, also will have the authority to amend or terminate the Stock Option Plan. A description of the Stock Option Plan is set forth below. The number of shares of the Company s common stock reserved for issuance pursuant to awards under the Stock Option Plan after the reorganization will be the number of shares of the Bank s common stock reserved for issuance pursuant to awards, as specified below, under the Stock Option Plan immediately prior to the reorganization, less the number of shares of the Bank s common stock that has been issued under the Stock Option Plan prior to the reorganization. As of the record date, options to purchase 180,000 shares of the Bank s common stock have been issued under the Stock Option Plan. Awards granted under the Stock Option Plan prior to the reorganization will expire in accordance with their terms. The Stock Option Plan expires on May 22, 2018; however, the ten-year period will be extended if the reorganization is approved by the Bank s shareholders. Terms of the Stock Option Plan. The following is a description of the Stock Option Plan as currently maintained by the Bank. The Stock Option Plan permits the issuance of incentive and nonqualified stock options to purchase shares of Bank common stock, or Stock Options, to full-time key employees and directors of the Bank. The Board of Directors of the Bank reserved 200,000 shares of Bank common stock for issuance pursuant to awards under the Stock Option Plan, any or all of which may be granted as incentive stock options. The number of shares reserved is subject to adjustment upon the occurrence of certain events described in the plan. Shares subject to awards that are forfeited or expire without being settled are returned to the pool of reserved shares available for issuance. As of the date of the Agreement, Stock Options to purchase 180,000 shares of Bank common stock were outstanding. The Stock Option Plan provides for administration by a Compensation Committee established by the Board of Directors of the Bank, or the Committee. Awards under the Stock Option Plan will be determined and granted by the Committee, subject to certain limitations specified in the Stock Option 8

13 Plan. The Committee has the authority to interpret the Stock Option Plan, make grants pursuant to the Stock Option Plan, and determine the terms and conditions within the context of the Stock Option Plan. Stock Options must be made exercisable at a price per share not less than the fair market value per share of the Bank s common stock on the date that the option is awarded. However, if the individual receiving an incentive stock option owns, at the time the incentive stock option is granted, more than ten percent of the combined voting power of all classes of stock of the Bank then outstanding, then the option price must be at least 110% of the fair market value of the common stock subject to the incentive stock option and the incentive stock option, by its terms, must not be exercisable after the expiration of five years from the date of the grant. The Bank is not permitted to issue any incentive stock options that, by their terms, permit an optionee to purchase shares having a fair market value in excess of $100,000 (determined at the time of the grant of the incentive stock option) during the same calendar year as the date of the grant of the incentive stock option. At the time of exercise of any Stock Options, payment must be made in full with immediately available funds. The period during which each Stock Option may be exercised is fixed by the Committee at the time the Stock Option is granted, but such period cannot exceed ten years from the date the Stock Option is granted. All unexercised Stock Options terminate upon the lapse of their stated terms and, in the case of incentive stock options, if occurring earlier, 90 days after the termination of the optionee s employment with the Bank by reason other than death. If an optionee of an incentive stock option should die while employed or within three months after termination of employment, the optionee or his or her successor in interest has the right to exercise the Stock Option within twelve months after the date of death. During such periods, all unexercised Stock Options may be exercised by the optionee or his or her legal representative in the event of death or mental disability. Stock Options issued pursuant to the Stock Option Plan are nontransferable except by will or by the law of descent and distribution. All Stock Options issued pursuant to the Stock Option Plan under a single option agreement must vest in equal amounts over a vesting period not less than three years in duration. An optionee has no rights as a shareholder until a stock certificate for Bank common stock is issued. Additionally, nothing in the Stock Option Plan or any Stock Options provides any right to continuation of employment. The number of shares of Bank common stock reserved for the grant of Stock Options, the number of shares of Bank common stock underlying a Stock Option, and the exercise price of outstanding Stock Options are subject to adjustment or substitution in the event of certain capital adjustments, such as a stock dividend, stock split, spinoff, rights offering or recapitalization. In the event of certain corporate transactions, such as a merger or reorganization, the Committee may make such adjustments with respect to awards and take such other action as it deems necessary or appropriate. The Board of Directors of the Bank may amend or terminate the Stock Option Plan subject to the requirement that shareholders must approve any amendment that: (1) increases the total number of shares for which Stock Options may be granted under the Stock Option Plan for all key employees (other than in connection with certain capital events, as described above); (2) changes the minimum purchase price for the optioned shares (other than in connection with certain capital events, as described above); (3) adversely affects outstanding Stock Options or any unexercised rights thereunder (other than in connection with certain capital events, as described above); or (4) extends the termination date of the Stock Option Plan. 9

14 Assumption of Options Issued Pursuant to the Midtown Bank & Trust Company 2003 Stock Incentive Plan and the Midtown Bank & Trust Company 2007 Stock Incentive Plan General. As a part of the reorganization, the Company will assume options issued under the Midtown Bank & Trust Company 2003 Stock Incentive Plan and the Midtown Bank & Trust Company 2007 Stock Incentive Plan, or the Midtown Plans. The Company will assume all outstanding options that may have been granted under the Midtown Plans prior to the reorganization. In addition, the Bank will amend the Midtown Plans immediately prior to the reorganization to substitute the Company as the granting corporation that maintains the Midtown Plans. The Bank will also amend the Midtown Plans to substitute the Company s common stock as the stock issuable under the plan. The Compensation Committee of the Company s Board of Directors will administer any outstanding options granted under the Midtown Plans. The Bank and the Company will amend the Midtown Plans to allow the Company to assume those plans solely for the purpose of administering those options outstanding under the Midtown Plans immediately prior to the Reorganization and not for the purpose of granting any future awards under those plans. Following the reorganization, the Company will have the authority to act as the sponsor of the plan in all respects. As the successor granting corporation, the Company, by action of its Board of Directors, also will have the authority to amend or terminate the Midtown Plans. The number of shares of the Company s common stock reserved for issuance pursuant to awards under the Midtown Plans after the reorganization will be the number of shares of the Bank s common stock reserved for issuance pursuant to awards, as specified below, under the Midtown Plans immediately prior to the reorganization, less the number of shares of the Bank s common stock that has been issued under the Midtown Plans prior to the reorganization. As of the record date, options to purchase 108,569 shares of the Bank s common stock have been issued under the Midtown Plans. Approval of the Long-Term Incentive Plan If the Agreement is approved by the shareholders, the Company will assume and implement the Long-Term Incentive Plan as summarized in Proposal 3 beginning on page 15. Tax-Free Treatment of Reorganization The share exchange between the Bank and the Company is structured to qualify as a reorganization within the meaning of Section 368(a)(1)(B) of the Internal Revenue Code. The following is a summary of the material federal income tax consequences of the proposed reorganization: No gain or loss will be recognized by a Bank shareholder who exchanges his or her Bank common stock solely for Company common stock. The aggregate basis and the holding period of Company common stock received by a Bank shareholder will be the same as the aggregate basis and the holding period of Bank common stock surrendered in the reorganization. Shareholders who exercise their right to dissent to the reorganization and receive cash will recognize gain or loss equal to the difference between the cash received and the basis in their shares of Bank common stock. However, the character of any gain or loss recognized by a dissenting shareholder may depend upon whether the shareholder is deemed to constructively own shares of the Company after 10

15 the share exchange. Dissenting shareholders are urged to consult their tax advisers regarding tax consequences of a decision to dissent to the reorganization. Any payments made to shareholders exercising their dissenters rights will not invalidate the treatment of the transaction as a tax-free reorganization for U.S. federal income tax purposes so long as the source of any cash paid to such shareholders for their stock comes from the Bank and not the Company. Dissenters Rights In accordance with Section of the Financial Institutions Code of Georgia and Section et seq. of the Georgia Business Corporation Code, the Bank s shareholders have the right to dissent from approval of the Agreement and to receive the fair value of their shares in cash. Holders of the Bank s common stock who fulfill the requirements described below will be entitled to assert dissenters rights. Pursuant to the provisions of Article 13 of the Georgia Business Corporation Code, if the Agreement is consummated, you must: give to the Bank, prior to the vote at the annual meeting with respect to the approval of the Agreement, written notice of your intent to demand payment for your shares of the Bank common stock (hereinafter referred to as Shares); not vote in favor of the Agreement at the annual meeting (by proxy or in person); and comply with the statutory requirements summarized below. If you perfect your dissenters rights, you will receive the fair value of your Shares as of the time immediately prior to the effective time of the Agreement. You may assert dissenters rights as to fewer than all of the Shares registered in your name only if you dissent with respect to all Shares beneficially owned by any one beneficial shareholder and you notify the Bank in writing of the name and address of each person on whose behalf you are asserting dissenters rights. The rights of a partial dissenter are determined as if the Shares as to which that holder dissents and that holder s other Shares were registered in the names of different shareholders. Voting against the Agreement will not, standing alone, satisfy the written demand requirement. In addition to not voting in favor of the Agreement, if you wish to preserve the right to dissent and seek appraisal, you must give a separate written notice of your intent to demand payment for your Shares if the Agreement is effected. Any shareholder who returns a signed proxy but fails to provide instructions as to the manner in which his or her Shares are to be voted will be deemed to have voted in favor of the Agreement and will not be entitled to assert dissenters rights. Any written objection to the Agreement satisfying the requirements discussed above should be addressed to the Bank, 307 N. Marietta Parkway, Marietta, Georgia 30060, Attention: R. Stanley Kryder. If the shareholders of the Bank approve the Agreement at the annual meeting, the Bank must deliver a written dissenters notice, or the Dissenters Notice, to all of its shareholders who satisfy the foregoing requirements. The Dissenters Notice must be sent within ten days after the effective date of consummation of the reorganization transaction and must: state where dissenting shareholders should send the demand for payment and where and when dissenting shareholders should deposit certificates for the shares; 11

16 inform holders of uncertificated shares to what extent transfer of these shares will be restricted after the demand for payment is received; set a date by which the Bank must receive the demand for payment (which date may not be fewer than 30 nor more than 60 days after the Dissenters Notice is delivered); and be accompanied by a copy of Article 13 of the Georgia Business Corporation Code. A record shareholder who receives the Dissenters Notice must demand payment and deposit his or her certificates with the Bank in accordance with the Dissenters Notice. Dissenting shareholders will retain all of the rights of a shareholder until those rights are canceled or modified by the consummation of the Agreement. A record shareholder who does not demand payment or deposit his or her share certificates as required, each by the date set in the Dissenters Notice, is not entitled to payment for his or her Shares under Article 13 of the Georgia Business Corporation Code. Except as described below, the Bank must, within ten days of the later of the effective date of the reorganization or receipt of a payment demand, offer to pay the amount the Bank estimates to be the fair value of the Shares, plus accrued interest from the effective date of consummation of the reorganization transaction, to each dissenting shareholder who complied with the payment demand and deposit requirements described above. The Bank s offer of payment must be accompanied by: recent financial statements of the Bank; the Bank s estimate of the fair value of the shares; an explanation of how the interest was calculated; a statement of the dissenter s right to demand payment under Section of the Georgia Business Corporation Code; and a copy of Article 13 of the Georgia Business Corporation Code. If the dissenting shareholder accepts the Bank s offer by written notice to the Bank within 30 days after the Bank s offer, the Bank must pay for the Shares within 60 days after the later of the making of the offer or the effective date of the Agreement. If the Agreement is not consummated within 60 days after the date set forth demanding payment and depositing share certificates, the Bank must return the deposited certificates and release the transfer restrictions imposed on uncertificated shares. The Bank must send a new Dissenters Notice if the Agreement is consummated after the return of certificates and repeat the payment demand procedure described above. Section of the Georgia Business Corporation Code provides that a dissenting shareholder may notify the Bank in writing of his or her own estimate of the fair value of such holder s Shares and the interest due, and may demand payment of such holder s estimate, if: he or she believes that the amount offered by the Bank is less than the fair value of his or her shares or that the Bank has calculated incorrectly the interest due; or 12

17 the Bank, having failed to consummate the reorganization plan, does not return the deposited certificates or release the transfer restrictions imposed on uncertificated shares within 60 days after the date set for demanding payment. A dissenting shareholder waives his or her right to demand payment under Section unless he or she notifies the Bank of his or her demand in writing within 30 days after the Bank makes or offers payment for the dissenting shareholder s Shares. If the Bank does not offer payment within ten days of the later of the Agreement s effective date or receipt of a payment demand, then the shareholder may demand the financial statements and other information required to accompany the Bank s payment offer, and the Bank must provide such information within ten days after receipt of the written demand. The shareholder may notify the Bank of his or her own estimate of the fair value of the Shares and the amount of interest due, and also may demand payment of that estimate. If a demand for payment under Section remains unsettled, the Bank must commence a nonjury equity valuation proceeding in the Superior Court of Cobb County, Georgia within 60 days after receiving the payment demand and must petition the court to determine the fair value of the Shares and accrued interest. If the Bank does not commence the proceeding within those 60 days, the Georgia Business Corporation Code requires the Bank to pay the amount demanded to each dissenting shareholder whose demand remains unsettled. The Bank is required to make all dissenting shareholders whose demands remain unsettled parties to the proceeding and to serve a copy of the petition upon each of them. The court may appoint appraisers to receive evidence and to recommend a decision on fair value. Each dissenting shareholder made a party to the proceeding is entitled to judgment for the fair value of such holder s Shares plus interest to the date of judgment. The court, in an appraisal proceeding commenced under the foregoing provision, must determine the costs of the proceeding, excluding fees and expenses of attorneys and experts for the respective parties, and must assess those costs against the Bank, except that the court may assess the costs against all or some of the dissenting shareholders to the extent the court finds they acted arbitrarily, vexatiously or not in good faith in demanding payment under Section The court also may assess the fees and expenses of attorneys and experts for the respective parties against the Bank if the court finds the Bank did not substantially comply with the requirements of specified provisions of Article 13 of the Georgia Business Corporation Code, or against either the Bank or a dissenting shareholder if the court finds that such party acted arbitrarily, vexatiously or not in good faith with respect to the rights provided by Article 13 of the Georgia Business Corporation Code. If the court finds that the services of attorneys for any dissenting shareholder were of substantial benefit to other dissenting shareholders similarly situated, and that the fees for those services should not be assessed against the Bank, the court may award those attorneys reasonable fees out of the amounts awarded the dissenting shareholders who were benefited. No action by any dissenting shareholder to enforce dissenters rights may be brought more than three years after the effective date of the Agreement, regardless of whether notice of the Agreement and of the right to dissent were given by the Bank in compliance with the dissenters notice and payment offer requirements. This summary of the material rights of a dissenting shareholder is qualified in its entirety by reference to Article 13 of the Georgia Business Corporation Code, included as Appendix B to this proxy statement/prospectus. If you intend to dissent from approval of the reorganization plan, you should review carefully the text of Appendix B and should also consult with your attorney. We will not give you any further notice of the events giving rise to dissenters rights or any steps associated with perfecting dissenters rights, except as indicated above or otherwise required by law. 13

18 We have not made any provision to grant you access to any of the corporate files of the Bank, except as may be required by the Georgia Business Corporation Code, or to obtain legal counsel or appraisal services at the expense of the Bank. Any dissenting shareholder who perfects his or her right to be paid the fair value of his or her Shares will recognize taxable gain or loss upon receipt of cash for such Shares for federal income tax purposes, as noted under the section entitled Tax-Free Treatment of Reorganization. Resale of Company Common Stock The Company s shares have not been registered under the Securities Act of 1933 or under any applicable state securities laws and cannot be sold or otherwise transferred unless the sale or transfer is registered under these acts or laws or an exemption from registration is available. As a condition to any transfer, the Company may require the transferor to provide the Company with an opinion of legal counsel stating that the transfer is legal. Vote Required To approve the Agreement, shareholders holding two-thirds of the outstanding shares of Bank common stock must vote in favor of it. As of the record date, all directors of the Bank as a group (eleven persons) could vote 636,652 shares of Bank common stock, constituting 14.75% of the total number of shares of Bank common stock outstanding. The Bank s directors have indicated their intent to vote their shares of common stock in favor of the Agreement. Recommendation We believe that the proposed reorganization is in the best interests of the Bank and its shareholders, and we unanimously recommend that you vote FOR approval of the Agreement. 14

19 The Long-Term Incentive Plan PROPOSAL 3: APPROVAL OF THE LONG-TERM INCENTIVE PLAN On March 18, 2015, subject to the approval of shareholders, the Board of Directors of the Bank adopted the Long-Term Incentive Plan. The Board of Directors is submitting the Long-Term Incentive Plan to the shareholders for approval primarily to be able to grant tax-favored incentive stock options under Section 421 of the Internal Revenue Code. The primary objectives of the Long-Term Incentive Plan are to provide incentives to certain officers, employees, directors, consultants and other service providers to manage the business of the Bank and its affiliates in a manner that will provide for the Bank s long-term growth and profitability; to encourage stock ownership and provide such recipients with a proprietary interest in the Bank; and to provide a further means of hiring, rewarding and retaining key personnel. The Bank currently maintains the Stock Option Plan and the Midtown Plans. The Bank currently has 20,000 shares of common stock remaining or available for grants of additional stock options under the Stock Option Plan, and no additional awards will be made under the Midtown Plans. Given the passage of time since the adoption of Stock Option Plan, the Board of Directors elected to adopt the Long-Term Incentive Plan to support the future needs of the Bank for the provision of long-term incentives. The Long-Term Incentive Plan also allows the Bank greater flexibility in the types of long-term incentives it may award and in the design and administration of those awards. At the annual meeting, shareholders will be asked to consider and vote on the approval and adoption of the Long-Term Incentive Plan. These benefits will pass to the Company if the reorganization is approved by shareholders. The Long-Term Incentive Plan permits the issuance of incentive and nonqualified stock options, stock appreciation rights, other stock-based awards and other cash-based awards, or Awards, to officers, employees, directors, consultants and other service providers of the Bank. The Board of Directors of the Bank reserved 250,000 shares of Bank common stock for issuance pursuant to Awards, any or all of which may be granted as incentive stock options. The number of shares reserved is subject to adjustment upon the occurrence of certain events described in the plan. Shares subject to awards that are forfeited or expire without being settled are returned to the pool of reserved shares available for issuance. As of the record date, no Awards were outstanding. The Long-Term Incentive Plan provides for administration by a committee to be established by the Board of Directors of the Bank or, in lieu of the establishment of a committee, by the Board of Directors. The committee may delegate its authority under the plan to the chairman of the committee or one or more officers of the Bank. Awards will be determined and granted by the committee or any delegate, subject to certain limitations specified in the Long-Term Incentive Plan. The committee and any delegate has the authority to interpret the Long-Term Incentive Plan, make grants pursuant to the Long-Term Incentive Plan, and determine the terms and conditions within the context of the Long-Term Incentive Plan. Stock options granted under the Long-Term Incentive Plan must be made exercisable at a price per share not less than the fair market value per share of the Bank s common stock on the date that the option is awarded. However, if the individual receiving an incentive stock option owns, at the time the incentive stock option is granted, more than ten percent of the combined voting power of all classes of stock of the Bank then outstanding, then the option price must be at least 110% of the fair market value of the common stock subject to the incentive stock option and the incentive stock option, by its terms, must not be exercisable after the expiration of five years from the date of the grant. 15

20 The Bank is not permitted to issue any incentive stock options that, by their terms, permit an optionee to purchase shares having a fair market value in excess of $100,000 (determined at the time of the grant of the incentive stock option) during the same calendar year as the date of the grant of the incentive stock option. At the time of exercise of any stock options, payment must be made in full with immediately available funds, by delivery of previously owned shares, in a cashless exercise utilizing a broker, or through a net exercise or in any combination thereof. Other Awards are settled in cash or with shares of the Bank s common stock, as the terms of the Awards may provide. All unexercised stock options terminate upon the lapse of their stated terms and, in the case of incentive stock options, if occurring earlier, three months after the termination of the optionee s employment with the Bank by reason other than death. If an optionee of an incentive stock option should die while employed, the optionee or his or her successor in interest has the right to exercise the incentive stock option within twelve months after the date of death. During such periods, all unexercised stock options may be exercised by the optionee or his or her legal representative in the event of death or disability. The committee may provide for the continuation of an incentive stock option beyond such periods, in which case the option shall thereafter be treated as a non-statutory option. Awards issued pursuant to the Long-Term Incentive Plan are generally nontransferable except by will or by the law of descent and distribution. An Award recipient has no rights as a shareholder until a stock certificate for Bank common stock is issued pursuant to the terms of the Award. Additionally, nothing in the Long-Term Incentive Plan or any stock options provides any right to continuation of employment. Awards may be cancelled, accelerated, paid or continued upon termination of the recipient s service relationship, as provided in the applicable Award or as the committee or its delegate may otherwise determine to the extent not prohibited by the terms of the Long-Term Incentive Plan. The committee may grant the recipient of an Award a cash amount that is intended to reimburse the recipient for the income taxes resulting from the receipt, vesting or settlement of the Award. The number of shares of Bank common stock reserved for the grant of Awards, the number and kind of shares reserved for issuance upon the settlement of Awards, the exercise price of outstanding stock options, the number and kind of shares to which each Award pertains, the total number of shares that may be subject to Awards granted by a delegate, and the threshold price of stock appreciation rights are subject to adjustment or substitution in the event of certain capital adjustments, such as a stock dividend, stock split, spinoff, rights offering or recapitalization. In the event of certain corporate transactions, such as a merger or reorganization, the committee may make such adjustments with respect to awards and take such other action as it deems necessary or appropriate. The Board of Directors of the Bank may amend or terminate the Long-Term Incentive Plan without shareholder approval. Recommendation The Board of Directors recommends that you vote FOR the Bank s adoption of the Long- Term Incentive Plan. 16