743397--3/27/2006--FIRST_MCMINNVILLE

related topics

{loan, real, estate}

{stock, price, share}

{provision, law, control}

{product, market, service}

{competitive, industry, competition}

{personnel, key, retain}

{regulation, change, law}

Economic conditions in Warren County can adversely affect the Company and First National Bank. Slower than anticipated growth in new product and service offerings could result in reduced net income. The shares of our common stock are not listed or traded on any recognized or established securities market, thus potentially reducing the marketability of the stock. The financial services industry is very competitive in general and it is extremely competitive in the Market Area. We have a concentration of our assets in commercial real estate in the Warren County Area. Reputational risk is inherent in the financial services business, especially in community banking. An inability to hire or retain certain key professionals, management and staff could adversely affect our revenues and net income. We are subject to extensive regulatory requirements and restrictions. The Company s charter and bylaws contain some antitakeover provisions. Our charter and bylaws govern voting rights. As a bank holding company, our Company is required to serve as a source of strength to First National Bank and our ownership and advances to Bank will be subject to a number of priorities. There are legal restrictions on the Company s and the Bank s ability to pay dividends. The Bank may legally declare dividends only from its undivided profits account so long as its reserve against deposits is not or will not be impaired beyond certain prescribed limits. Even assuming the availability of net or accumulated earnings (if any), and any assumed capacity to maintain capital at levels required by governmental regulations, the Bank may choose to retain all earnings for Our shares are not insured by the FDIC.

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743397--3/27/2006--FIRST_MCMINNVILLE_CORP