<PAGE>
FILED PURSUANT TO
RULE 424(b)(1)
FILE NO: 333-03499
TIB BANK OF THE KEYS
99451 OVERSEAS HIGHWAY
KEY LARGO, FLORIDA 33037
May 29, 1996
Dear Shareholder:
You are cordially invited to attend a Special Meeting of Shareholders
(the "Special Meeting") of TIB Bank of the Keys (the "Bank") to be held on
Thursday, June 27, 1996 at 3:00 p.m. at the Sheraton Hotel, 97000 South
Overseas Highway, Key Largo, Florida 33037.
The purpose of the meeting is to consider and vote upon an Agreement and
Plan of Merger (the "Merger Agreement") whereby the Bank would become a
wholly-owned subsidiary of TIB Financial Corp., a new Florida bank holding
company (the "Company"). If the Bank's reorganization into a holding company
structure is approved, each outstanding share of common stock of the Bank
will be converted into and exchanged for one share of common stock of the
Company, and the shareholders of the Bank will become shareholders of the
Company. The Bank's business will be carried on as a wholly-owned subsidiary
of the Company.
The accompanying Proxy Statement/Prospectus includes a description of the
terms and conditions of the Bank's proposed reorganization into a holding
company structure, a description of the business and condition of the Bank
and the Company, and certain other significant information, including the
appraisal rights of any shareholders wishing to dissent from the
reorganization transaction. A copy of the Merger Agreement is attached as
Exhibit "A" to the Proxy Statement/Prospectus. The Proxy Statement/Prospectus
describes your rights as a shareholder of the Company, which will be
different in certain respects from your rights as a shareholder of the Bank.
You are urged to carefully review the terms of the Merger Agreement and the
discussions contained in the Proxy Statement/Prospectus.
THE BOARD OF DIRECTORS BELIEVES THAT THE BANK'S REORGANIZATION INTO A HOLDING
COMPANY STRUCTURE AS DESCRIBED IN THE PROXY STATEMENT/PROSPECTUS IS IN THE
BEST INTEREST OF THE BANK AND ITS SHAREHOLDERS AND RECOMMENDS A VOTE "FOR"
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APPROVAL OF THE MERGER AGREEMENT.
The affirmative vote of holders of at least a majority of the outstanding
shares of common stock of the Bank is required in order to approve the Merger
Agreement. It is, therefore, extremely important that your shares be
represented at the Special Meeting, whether or not you are personally able to
attend. You are urged to complete, sign and return the accompanying form of
proxy in the enclosed envelope as soon as possible.
REGARDLESS OF WHETHER YOU EXPECT TO BE PRESENT AT THE SPECIAL MEETING IN
PERSON, PLEASE VOTE, SIGN AND MAIL THE ACCOMPANYING FORM OF ENCLOSED PROXY IN
THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE. YOUR PROXY MAY BE REVOKED
AT ANY TIME PRIOR TO THE VOTE BEING TAKEN AT THE SPECIAL MEETING.
Sincerely, Sincerely,
W. Kenneth Meeks Edward V. Lett
Chairman President and Chief Executive Officer
<PAGE>
TIB BANK OF THE KEYS
99451 OVERSEAS HIGHWAY
KEY LARGO, FLORIDA 33037
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 27, 1996
May 29, 1996
A Special Meeting of Shareholders (the "Special Meeting") of TIB
Bank of the Keys (the "Bank") will be held on Thursday, June 27, 1996 at 3:00
p.m. at the Sheraton Hotel, 97000 South Overseas Highway, Key Largo, Florida
33037 for the following purposes:
(1) To consider and vote upon the approval of a proposed Agreement
and Plan of Merger (the "Merger Agreement") whereby the Bank would become a
wholly-owned subsidiary of TIB Financial Corp., a new Florida bank holding
company (the "Company"). If the Merger Agreement is approved, each outstanding
share of common stock of the Bank will be converted into and exchanged for one
share of common stock of the Company, and the shareholders of the Bank will
become shareholders of the Company. The Merger Agreement provides that the
Company will cause TIB Interim Corp. (In Organization), a new state-chartered
interim financial institution that will be a wholly-owned subsidiary of the
Company ("Interim"), to be merged into the Bank with the Bank surviving the
Merger and continuing its business as a wholly-owned subsidiary of Company;
and
(2) To consider such other business as may properly come before the
Special Meeting or any adjournments thereof.
The affirmative vote of holders of at least a majority of the
outstanding shares of common stock of the Bank is required in order to approve
the Merger Agreement. If the Merger Agreement is approved, dissenting
shareholders are entitled, pursuant to Section 658.44 of the Florida Banking
Code to receive payment in cash for the shares of the Bank provided they
comply with the provisions of Section 658.44, including the requirement that
such shareholder must vote against approval of the Merger Agreement or deliver
notice in writing to the Bank, at or prior to the Special Meeting, that the
shareholder elects to dissent from the reorganization and receive cash for the
value of the shares of the Bank held by them if the reorganization is
consummated.
The Board of Directors has set May 15, 1996 as the record date for
the Special Meeting. Only shareholders of record at the close of business on
the record date will be entitled to notice of and to vote at the Special
Meeting.
REGARDLESS OF WHETHER A SHAREHOLDER EXPECTS TO BE PRESENT AT THE SPECIAL
MEETING IN PERSON, PLEASE VOTE, SIGN AND MAIL THE ACCOMPANYING FORM OF PROXY
IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE. YOUR PROXY MAY BE REVOKED
AT ANY TIME PRIOR TO THE VOTE BEING TAKEN AT THE SPECIAL MEETING.
By Order Of The Board Of Directors Of
TIB BANK OF THE KEYS
W. Kenneth Meeks Edward V. Lett
Chairman President and Chief Executive Officer
<PAGE>
TIB BANK OF THE KEYS
99451 OVERSEAS HIGHWAY
KEY LARGO, FLORIDA 33037
PROXY STATEMENT/PROSPECTUS
FOR SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD THURSDAY, JUNE 27, 1996
This Proxy Statement/Prospectus constitutes the Proxy Statement of TIB
Bank of the Keys (the "Bank") in connection with the solicitation by the Board
of Directors of the Bank of proxies for use at a Special Meeting of
Shareholders (the "Special Meeting") to be held on Thursday, June 27, 1996,
and any adjournments thereof. This Proxy Statement/Prospectus is being mailed
to the Bank's shareholders of record as of the close of business on May 15,
1996 who are entitled to receive notice of and to vote at the Special Meeting.
The Special Meeting has been called by the Board of Directors of the Bank
in order for the Bank's shareholders to consider and vote upon approval of an
Agreement and Plan of Merger (the "Merger Agreement") providing for a
reorganization whereby the Bank would become a wholly-owned subsidiary of TIB
Financial Corp., a new Florida bank holding company (the "Company"). If the
Bank's reorganization into a holding company structure is approved, each
outstanding share of common stock of the Bank will be converted into and
exchanged for one share of common stock of the Company, and the shareholders
of the Bank will become shareholders of the Company. The Merger Agreement
provides that the Company will cause its wholly-owned subsidiary, TIB Interim
Corp. (In Organization), a new state-chartered interim financial institution
that will be a wholly-owned subsidiary of the Company ("Interim"), to be
merged with and into the Bank, with the Bank surviving the merger and
continuing its business as a wholly-owned subsidiary of the Company. A copy of
the Merger Agreement is attached as Exhibit "A" to this Proxy
Statement/Prospectus.
This Proxy Statement/Prospectus also constitutes the Prospectus of the
Company under the Securities Act of 1933, as amended, with respect to the
issuance of up to 1,765,616 shares of common stock of the Company to
shareholders of the Bank in exchange for an equal number of shares of common
stock of the Bank upon consummation of the Bank's reorganization into a
holding company structure pursuant to the Merger Agreement.
The executive offices of the Bank and the Company are located at 99451
Overseas Highway, Key Largo, Florida 33037 and the telephone number is (305)
451-4660.
The date of this Proxy Statement/Prospectus is May 29, 1996.
<PAGE>
______________________
THE COMMON STOCK OF THE COMPANY ISSUABLE IN CONNECTION WITH THE PROPOSED
REORGANIZATION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
----------------------
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROXY STATEMENT/
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROXY STATEMENT/PROSPECTUS
DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANY ONE IN ANY JURISDICTION IN
WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON
MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<S> <C>
SUMMARY OF THE PROXY STATEMENT/PROSPECTUS................................. 1
RECOMMENDATION OF BOARD OF DIRECTORS...................................... 4
THE PROPOSED REORGANIZATION............................................... 4
EFFECT OF THE REORGANIZATION ON THE BANK'S SHAREHOLDERS................... 6
RIGHTS OF DISSENTING SHAREHOLDERS......................................... 10
FEDERAL INCOME TAX CONSEQUENCES........................................... 11
TRADING MARKET............................................................ 13
UNAUDITED CONDENSED PRO FORMA CONSOLIDATED BALANCE SHEET.................. 13
BUSINESS OF BANK.......................................................... 15
BUSINESS OF COMPANY....................................................... 16
SUPERVISION AND REGULATION................................................ 16
MANAGEMENT................................................................ 19
CERTAIN TRANSACTIONS...................................................... 25
PRINCIPAL SHAREHOLDERS.................................................... 25
DESCRIPTION OF CAPITAL STOCK.............................................. 26
LEGAL MATTERS............................................................. 27
FINANCIAL STATEMENTS...................................................... 27
OTHER MATTERS............................................................. 28
ADDITIONAL INFORMATION.................................................... 28
EXHIBIT "A" - AGREEMENT AND PLAN OF MERGER................................A-1
Attachment A - Branch Locations...............................B-1
Attachment B - Rights of Dissenting Shareholders..............C-1
</TABLE>
REVOCABLE PROXY FORM
<PAGE>
SUMMARY OF THE PROXY STATEMENT/PROSPECTUS
THE FOLLOWING IS A SUMMARY OF CERTAIN INFORMATION WITH RESPECT TO THE
MATTERS TO BE CONSIDERED AT THE SPECIAL MEETING OF SHAREHOLDERS OF THE BANK.
THIS SUMMARY DOES NOT PURPORT TO BE COMPLETE AND IS QUALIFIED IN ITS ENTIRETY
BY THE MORE DETAILED INFORMATION CONTAINED IN THIS PROXY STATEMENT/PROSPECTUS,
INCLUDING THE EXHIBITS HERETO, TO WHICH REFERENCE IS MADE FOR A COMPLETE
STATEMENT OF THE MATTERS DISCUSSED BELOW.
SPECIAL MEETING OF SHAREHOLDERS
The Special Meeting of Shareholders (the "Special Meeting") of TIB Bank
of the Keys (the "Bank") will be held at the Sheraton Hotel, Overseas Highway,
Key Largo, Florida 33037 on Thursday, June 27, 1996 at 3:00 p.m. Shareholders
of record at the close of business on May 15, 1996 are entitled to receive
notice of and to vote at the Special Meeting. The Bank is a publicly-owned
financial institution with approximately 460 shareholders of record.
PURPOSE OF THE SPECIAL MEETING
The Special Meeting has been called by the Board of Directors of the Bank
to consider and vote upon approval of an Agreement and Plan of Merger (the
"Merger Agreement") providing for a reorganization whereby the Bank would
become a wholly-owned subsidiary of TIB Financial Corp., a new Florida
corporation (the "Company"). If the Merger Agreement is approved, and the
proposed reorganization completed, each outstanding share of common stock of
the Bank will be converted into and exchanged for one share of common stock of
the Company, and the shareholders of the Bank will become shareholders of the
Company. The Bank's business will then be carried on as a wholly-owned
subsidiary of the Company. The first annual meeting of the Company's
shareholders at which directors are elected will be held in 1997. See "The
Proposed Reorganization."
THE BANK
The Bank is a state-chartered commercial bank headquartered in Key Largo,
Florida. The Bank's deposits are insured by the Bank Insurance Fund ("BIF") of
the Federal Deposit Insurance Corporation (the "FDIC"). The Bank is not a
member of the Federal Reserve System. The Bank opened for business in 1974.
The primary business of the Bank is attracting deposits from the public
and using such deposits to make real estate, business and consumer loans. As
of March 31, 1996, the Bank had total assets of approximately $230.1 million,
total deposits of approximately $206.0 million, and shareholders' equity of
approximately $21.3 million. The Bank's business is conducted at its main
banking office at 99451 Overseas Highway, Key Largo, Florida 33037, where its
principal executive offices are located, and at its branch offices at the
following addresses: 10330 Overseas Highway, Key Largo, Florida; 91980
Overseas Highway, Tavernier, Florida; 80900 Overseas Highway, Tavernier,
Florida; 11401 Overseas Highway, Marathon Shores, Florida; 2315 Overseas
Highway, Marathon, Florida; Mile Marker 30.4, Big Pine Key, Florida; 330
Whitehead Street, Key West, Florida; and 3322 N. Roosevelt Boulevard, Key
West, Florida. See "Business of the Bank".
BANK HOLDING COMPANY
TIB Financial Corp. is a new Florida corporation organized in February
1996 to serve as a holding company for the Bank. Upon consummation of the
proposed reorganization, the Company's primary asset will be 100% of the
outstanding common stock of the Bank. The Company was organized at the
direction of the Bank's Board of Directors for the purpose of effecting the
proposed reorganization transaction with the Bank and has not engaged in any
active business operations. The Company is in the process of forming TIB
Interim Corp. (In Organization) ("Interim") as its wholly-owned subsidiary for
the purpose of effecting the reorganization with the Bank. Interim has not yet
been formed or engaged in any active business
<PAGE>
operations. If the reorganization is approved, the Company will cause Interim
to be merged into the Bank and thereafter Interim will cease to exist as a
separate entity. See "Business of the Company."
PROPOSED REORGANIZATION
If the Bank's proposed reorganization into a holding company structure is
approved, the Company will acquire 100% of the outstanding common stock of the
Bank through a corporate transaction in which Interim merges into the Bank
with the Bank as the surviving entity. Upon consummation of the merger, each
outstanding share of common stock of the Bank will be converted into and
exchanged for one share of common stock of the Company, and the shareholders
of the Bank will become shareholders of the Company. The Bank's business will
be carried on as a wholly-owned subsidiary of the Company. See "The Proposed
Reorganization."
REASONS FOR THE PROPOSED REORGANIZATION
The Board of Directors of the Bank believes the proposed reorganization
to be in the best interest of the Bank and its shareholders as it will better
facilitate the Bank's ability to serve its customers' needs for financial
services. The holding company structure will provide the Bank with greater
flexibility than the Bank would otherwise possess. Through the holding
company, the Bank will be able to expand and diversify its business into other
permitted banking and non-banking activities, either through newly formed
subsidiaries or through acquisitions. While management has no present plans to
engage actively in any other business activities, management will study the
feasibility of establishing and acquiring subsidiaries to engage in other
banking and non-banking activities to the extent permitted by law. The holding
company structure will provide the Company with an alternative means for
raising additional capital. The Company may raise capital by borrowing funds,
rather than selling equity capital, which funds can be contributed to the
capital of the Bank or to other subsidiaries. The Company, as a bank holding
company, would be permitted to acquire other bank holding companies or,
subject to certain restrictions, other financial institutions.
EFFECT OF THE REORGANIZATION
If the Merger Agreement is approved and the proposed reorganization is
consummated, the Bank will continue to operate as a state-chartered commercial
bank and will engage in substantially the same business and activities in
which the Bank is presently engaged. The directors of the Bank and the Company
will be the same. Moreover, the directors do not anticipate any changes in the
officers of the Bank following the reorganization. The Company will be
operated as a bank holding company within the meaning of the federal Bank
Holding Company Act of 1956. The Company will be authorized to engage in any
activity permitted by law to a business corporation, subject to applicable
federal and state regulatory restrictions on the activities of bank holding
companies.
With respect to the shareholders of the Bank, there are significant
differences between the rights of a shareholder in the Bank and the rights of
a shareholder in the Company. See "The Proposed Reorganization" and "Effect of
the Reorganization on the Bank's Shareholders".
VOTE REQUIRED TO APPROVE THE MERGER AGREEMENT
The affirmative vote of the holders of at least a majority of the
outstanding shares of common stock of the Bank is required in order to approve
the Agreement. In addition, consummation of the reorganization is subject to
the satisfaction of certain other conditions, including the approval of
various federal and state regulatory authorities. Moreover, if the Board of
Directors of the Bank deems it appropriate to do so, it has the right to
terminate the Merger Agreement, even after shareholder approval. See "The
Proposed
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<PAGE>
Reorganization."
RIGHTS OF DISSENTING SHAREHOLDERS
A shareholder has the right to dissent from the Merger Agreement. If the
Merger Agreement is approved, under the provisions of Section 658.44 of the
Florida Banking Code any shareholder of record who votes against the Merger at
the meeting at which the Merger Agreement is approved or advises the Bank in
writing at or prior to such meeting that he dissents from the reorganization,
shall be entitled to be paid the fair value of his shares. On or promptly
after the effective date of the merger, the Bank may fix an amount that it
considers to be not more than the fair market value of the shares as of the
time of the merger. If the Bank does not establish such a fair value or such
value is not acceptable to the dissenting shareholder, appraisers will be
selected by the Bank and the dissenting shareholder to establish the fair cash
value. Failure to follow the procedures set forth in Section 658.44 will waive
the shareholder's rights of appraisal under this section of the law. A
complete copy of the statute relating to the perfection of a dissenting
shareholder's rights is attached as Attachment B to Exhibit "A" to this Proxy
Statement/Prospectus and shareholders are encouraged to read the requirements
contained therein, which requirements must be met prior to the shareholder
being entitled to be paid the fair value of his shares. See "Rights of
Dissenting Shareholders."
FEDERAL INCOME TAX CONSEQUENCES
Consummation of the reorganization is subject to, among other matters,
receipt of an opinion from Holland & Knight, special counsel to the Company
and the Bank, to the effect, that (i) under applicable provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), the reorganization
will constitute a tax-free transaction, (ii) no gain or loss will be
recognized by the shareholders of the Bank upon conversion of their common
stock of the Bank into common stock of the Company pursuant to the Merger
Agreement, and (iii) cash received by shareholders of the Bank exercising
their dissenters' rights will be treated as amounts distributed in redemption
of their common stock of the Bank subject to and taxable under the provisions
of Code Section 302 as either ordinary income or capital gain or loss,
depending upon the circumstances of the individual shareholder.
RECOMMENDATION OF BOARD OF DIRECTORS
THE BOARD OF DIRECTORS OF THE BANK BELIEVES THAT THE PROPOSED
REORGANIZATION IS IN THE BEST INTEREST OF THE BANK AND ITS SHAREHOLDERS AND
RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE PROPOSAL TO APPROVE THE
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MERGER AGREEMENT.
THE PROPOSED REORGANIZATION
THE FOLLOWING DISCUSSION INCLUDES SUMMARIES OF CERTAIN PROVISIONS OF THE
MERGER AGREEMENT. THIS DISCUSSION DOES NOT PURPORT TO BE COMPLETE AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FULL TEXT OF THE MERGER
AGREEMENT ATTACHED AS EXHIBIT "A" TO THIS PROXY STATEMENT/PROSPECTUS.
THE MERGER AGREEMENT
The Boards of Directors of the Bank, the Company and Interim, by
unanimous votes of all directors present at their respective meetings, have
approved and authorized the execution of the Merger Agreement. The Merger
Agreement sets forth the terms of the proposed reorganization and contains (i)
conditions to each party's obligations to consummate the reorganization, (ii)
representations and warranties of
3
<PAGE>
the parties, (iii) procedures which must be followed to consummate the
reorganization, and (iv) certain covenants of each of the parties to the Merger
Agreement.
TERMS OF REORGANIZATION
The Bank's proposed reorganization into a holding company structure would
be accomplished by the Holding Company causing Interim to be merged into the
Bank, with the Bank to survive that merger and to continue its business
thereafter as a wholly-owned subsidiary of the Holding Company. At the time the
reorganization is consummated, each outstanding share of common stock of the
Bank will be converted into and exchanged for one share of common stock of the
Holding Company, and the shareholders of the Bank will become shareholders of
the Holding Company. Following consummation of the reorganization, certificates
representing shares of common stock of the Bank will automatically be deemed to
represent shares of common stock of the Holding Company, and each shareholder
may exchange his stock certificates representing shares of common stock of the
Bank for stock certificates representing an equal number of shares of common
stock of the Holding Company. On the basis of the number of shares of common
stock of the Bank which were outstanding on the date of record, and assuming no
dissenting shareholders or exercises of outstanding stock options, the Holding
Company will issue 1,426,288 shares of its common stock to the shareholders of
the Bank pursuant to the Merger Agreement, all of which will be owned by the
former shareholders of the Bank.
REASONS FOR THE REORGANIZATION
The Board of Directors of the Bank believes the proposed reorganization to
be in the best interest of the Bank and its shareholders. The Board of Directors
believes that the holding company structure will better facilitate the Bank's
ability to serve its customers' needs for financial services. The holding
company structure will also provide greater flexibility than the Bank would
otherwise possess. Through the holding company, the Bank will be able to expand
and to diversify its business into other permitted banking and non-banking
activities, either through newly formed subsidiaries or through acquisitions.
The holding company structure will also enable the Holding Company to provide
banking related services that are in addition to the traditional services that a
commercial bank may provide under present law. While management has no present
plans to engage actively in any other business activities, management will study
the feasibility of establishing and acquiring subsidiaries to engage in other
banking and non-banking business activities to the extent permitted by law.
In addition to possible expansion into non-banking activities, Florida law
presently restricts the ability of a state-chartered bank to borrow money or
issue other obligation to evidence such borrowing. This restriction limits the
ability of the Bank to raise additional capital which may be needed. The holding
company structure will provide the Holding Company with an alternative means for
raising such additional capital. The Holding Company may raise capital by
borrowing funds, rather than selling equity capital, which funds can be
contributed to the capital of the Bank or to other subsidiaries. Furthermore,
Florida law places certain restrictions on the Bank's ability to repurchase its
own shares, while the Holding Company, as a bank holding company, would be
permitted, under certain conditions, to repurchase its own shares of common
stock.
The Holding Company, as a bank holding company, would be permitted to
acquire other bank holding companies or, subject to certain restrictions, other
financial institutions.
CONDITIONS TO THE REORGANIZATION
The consummation of the reorganization is subject to: (i) the approval of
the Agreement by holders of at least a majority of the outstanding shares of
common stock of the Bank; (ii) the approval of the reorganization by the Florida
Department of Banking and Finance, the Federal Deposit Insurance Corporation,
the Board of Governors of the Federal Reserve System, and the United States
Department of Justice; and (iii) the
4
<PAGE>
effectiveness of a Registration Statement filed with the Securities and Exchange
Commission relating to the shares of common stock of the Holding Company
issuable to the shareholders of the Bank. The Merger Agreement has already been
approved by the Boards of Directors of the Bank, the Holding Company and
Interim. The Merger Agreement provides that the reorganization will be
consummated as soon as practical after all conditions have been satisfied.
The Merger Agreement provides broad flexibility to the Board of Directors
of the Bank to terminate the Merger Agreement prior to consummation, either
before or after a vote of the Bank's shareholders, should it appear in the best
interest of the Bank to terminate the Merger Agreement.
STOCK CERTIFICATES
Upon and after consummation of the reorganization, Bank share certificates
will automatically instead represent a like number of shares of common stock of
the Holding Company. No exchange of certificates will be required. Upon the
surrender of any Bank share certificate which prior to the reorganization
represented shares of common stock of the Bank, the holder thereof (or the
shareholder's transferee) will be entitled to receive a Holding Company share
certificate for a like number of shares of Holding Company common stock.
SHAREHOLDER APPROVAL
The affirmative vote of the holders of at least a majority of the
outstanding shares of common stock of the Bank entitled to vote at the Special
Meeting is required for approval of the Merger Agreement. As of May 15, 1996 the
record date set by the Board of Directors for determination of shareholders
entitled to notice of and to vote at the Special Meeting, the Bank had 1,426,288
shares of common stock outstanding.
ACCOUNTING TREATMENT
The Bank's reorganization into a holding company structure will be
accounted for on a historical cost basis in accordance with generally accepted
accounting principles and, accordingly, the financial statements of the Holding
Company and the Bank will be combined for all prior years, and any amounts paid
for dissenters' shares will be treated as a reduction of shareholders' equity.
EFFECT OF THE REORGANIZATION ON THE BANK'S SHAREHOLDERS
If the reorganization is consummated, the shareholders of the Bank would
become shareholders of the Holding Company and would maintain their current
proportionate interest, except as may be effected by any dissenting
shareholders. Thereafter, the rights and privileges of the shareholders of the
Holding Company will be governed primarily by the provisions of the Florida
Business Corporation Act rather than by the Florida Banking Code, which governs
the rights of shareholders of a state-chartered bank. The following material
includes summaries of certain of such differences.
BUSINESS COMBINATIONS
The Holding Company's Articles of Incorporation do not "opt out" of the
antitakeover provisions of Sections 607.901 and 607.902 of the Florida Business
Corporation Act, which will apply to certain attempted acquisitions of the
Holding Company by an "interested shareholder."
Under Section 607.901, acquisition activities with "interested
shareholders" (i.e., those with greater than 10% ownership interest) are subject
to a supermajority/fair price provision. This provision increases to 66-2/3%
5
<PAGE>
of the disinterested shareholders (from a mere majority of all shareholders) the
vote required to approve certain transactions with interested shareholders.
These provisions, however, do not apply (i) in the event the transaction has
been approved by a majority of directors who are not affiliated with the
interested shareholder; (ii) if the company has had less than 300 shareholders
during the last 3 years; (iii) if the interested shareholder has been the
beneficial owner of 80% of the company's outstanding shares for at least 5
years; (iv) if the interested shareholder is the beneficial owner of at least
90% of the outstanding shares of the company, exclusive of shares acquired from
the company, unless such acquisition has been approved by disinterested
directors; or (v) the amount to be paid to the shareholders is a "fair price,"
meaning that the highest price paid by the interested shareholder to purchase
shares of the target in the last two years must be maintained for additional
purchases.
Section 607.902 embodies a "control share acquisition statute" which places
certain procedural restrictions upon the acquisition of ranges of voting power
of the Holding Company (20% to 33-1/3%, 33-1/3% to 50% and greater than 50%).
The statute provides that the proposed share buyer may give a notice to the
Holding Company before or after such an acquisition has occurred and can request
that a shareholders meeting be held to consider the proposed acquisition if the
acquiring person agrees to pay the company expenses in regard to the meeting.
Unless the buyer agrees otherwise, the meeting is to be held within 50 days
after receipt of the notice by the company. A notice to the shareholders of the
company is to be sent and shall include: (I) a copy of the acquiring persons
statement delivered by the proposed buyer; (ii) a statement by the board of
directors of its position or recommendation or that it is making no
recommendation with respect to the proposed acquisition; and (iii) a statement
that the shareholders are or may be entitled to assert dissenters rights in
regard to the proposed transaction. If the company's Articles of Incorporation
or Bylaws contain a provision to the effect that the shares so purchased are
subject to redemption by the company (which the Holding Company's currently do
not), the company may redeem such shares where no acquiring person statement was
filed for a period of up to 60 days after the last such acquisition at their
"fair value." The effect of this section is to make such control share
acquisition more difficult to complete without the prior approval and support of
the Board of Directors and shareholders of the Holding Company.
These sections may have the effect of protecting the incumbent Board of
Directors and management by discouraging takeover attempts which are not
supported by the Board and management. As a result, shareholders may not have
the opportunity to sell some or all of their shares in such a takeover attempt.
In addition, these provisions could affect the price of the Holding Company's
common shares by making it less attractive to persons who invest in securities
in anticipation of an increase in price if a takeover attempt oy also deter an
interested shareholder from proceeding with a second step business combination
unless approved by the Board of Directors, especially if the market price of the
Holding Company shares had declined from the highest price paid by the
interested shareholder in acquiring shares of such class. Furthermore, unless
the Board of Directors approves a business combination, these provisions would
give the holder of a minority of the total outstanding shares a veto power over
a business combination with an interested shareholder notwithstanding that the
other stockholders, including the interested shareholder, may believe the
business combination to be desirable or beneficial.
COMPARISON OF VOTING AND OTHER RIGHTS
Voting by the shareholders of both the Bank and the Holding Company is on
the basis of one vote for each share, without any cumulative voting rights. The
Bylaws of the Bank provide for the annual election of the directors by the
shareholders for the ensuing year. The Articles of Incorporation of the Holding
Company provide for the division of directors into three classes, with members
of each class serving three-year terms and the shareholders electing one class
annually. The classification of the directors of the Holding Company has the
effect of making it more difficult for shareholders to effect an immediate
change in the composition of a majority of the Board of Directors.
6
<PAGE>
The Bylaws of the Bank provide for the removal of any director, with or
without cause, upon the vote of a majority of the outstanding shares of capital
stock of the Bank. The Articles of Incorporation of the Holding Company provide
that a director may be removed from office at any time, only for cause, by the
vote of the holders of at least 67% of the outstanding shares of capital stock
of the Holding Company, unless the removal has been approved by a resolution
adopted by at least 67% of the directors then in office, in which event the
removal need only be approved by vote of holders of a majority of the voting
power of the then outstanding shares of capital stock of the Holding Company.
The Bylaws of the Bank provide that special meetings of shareholders may be
called at any time by the Board of Directors or by any three or more
shareholders owning in the aggregate more than twenty-five percent (25%) of the
capital stock of the Bank. The Articles of Incorporation of the Holding Company
provide that special meetings of shareholders may be called at any time by the
Chairman of the Board or the President or by a majority of the directors then in
office or by 67% of the then outstanding shares of stock of the Holding Company.
The Bylaws of the Bank do not provide that the shareholders of the Bank may
take action by written consent in lieu of taking such action at an annual or
special meeting of shareholders called for that purpose. The Articles of
Incorporation of the Holding Company provide that shareholders of the Holding
Company shall not be entitled to take any action by written consent in lieu of
taking such action at an annual or special meeting of shareholders called for
that purpose.
AMENDMENT OF ARTICLES OF INCORPORATION
The Bank's Articles of Incorporation may be amended by the affirmative vote
of a majority of the outstanding voting stock of the Bank. The Articles of
Incorporation of the Holding Company provide that certain articles may be
amended by the vote of holders of at least 67% of the voting power of the
outstanding shares of capital stock; provided, however, that such 67% voting
requirement shall not be applicable if the board of directors of the Holding
Company shall approve such action by resolution adopted by at least 67% of the
directors then in office, in which case the affirmative vote of holders of a
majority of the then outstanding shares of capital stock of the Holding Company
is required to approve such action. Other provisions of the Articles of
Incorporation require approval by a majority of the outstanding voting stock of
the Holding Company for any amendment thereof.
AMENDMENT OF BYLAWS
The Bylaws of the Bank may be amended by a majority vote of the Bank's
Board of Directors or by a majority vote of the holders of the outstanding
shares of the Bank. The Holding Company's Articles of Incorporation provide that
the Board of Directors is authorized to amend or repeal the Bylaws of the
Holding Company by a majority of the directors then in office, subject to the
power of the holders of the capital stock of the Holding Company to amend or
repeal the Bylaws upon the affirmative vote of holders of at least 67% of the
voting power of the outstanding shares of capital stock.
SHARE PURCHASES
Pursuant to the provisions of the Florida Business Corporation Act and the
federal Bank Holding Company Act of 1956 and Federal Reserve Board Regulation Y,
the Holding Company will have the right to purchase its own shares subject to
certain prescribed financial tests. Under the Florida Banking Code, the Bank is
limited in its ability to purchase its outstanding shares from its shareholders.
7
<PAGE>
PAYMENT OF DIVIDENDS
The Holding Company will be permitted to pay dividends on its outstanding
capital stock at such time and in such amounts as the Board of Directors deems
advisable, subject only to restrictions contained in the Florida Business
Corporation Act and subject to the amount of dividends which may be declared by
its subsidiary, the Bank. The Board of Directors of the Bank, however, is
limited in its ability to pay cash dividends on the outstanding capital stock of
the Bank. In general, the Bank may not declare a dividend without the approval
of the Florida Department of Banking and Finance if the total of the dividends
declared by the Bank in a calendar year exceeds the total of its net profits for
that year combined with its retained profits of the preceding two years.
Notwithstanding the proposed reorganization, the Bank will be governed by the
aforementioned restrictions with regard to the payment of dividends to the
Holding Company which, in turn, may serve as a limitation on any future dividend
payments by the Holding Company to its shareholders.
NO PREEMPTIVE RIGHTS
Shareholders of the Bank do not have preemptive rights. Also, shareholders
of the Holding Company do not have preemptive rights. This permits the Board of
Directors of the Holding Company to utilize and issue the authorized and
unissued shares of the Holding Company's stock as it determines to be in the
best interests of the Holding Company and its shareholders. Since the Board of
Directors could issue shares of the Holding Company's stock to raise additional
capital and for other proper corporate purposes, this difference could result in
dilution of a shareholder's interest in the Holding Company. Any issuance of
shares, however, would have to be approved by the Board of Directors of the
Holding Company.
CERTAIN RESTRICTIONS ON TRANSFER OF STOCK
The common stock of the Holding Company to be issued to shareholders of the
Bank pursuant to this Proxy Statement/Prospectus is freely transferable, except
for shares issued to persons who are deemed "control persons" or "affiliates" of
the issuer, as described below.
Each person who controls, or who is a member of the group which controls,
or who is under common control with the Bank at the time the Merger Agreement is
submitted to a vote of the shareholders of the Bank may, in connection with any
subsequent sale or other distribution of the common stock of the Holding Company
received pursuant to the reorganization, be deemed to be an "underwriter" within
the meaning of the Securities Act of 1933 (the "Securities Act"), unless such
securities are sold in accordance with Rule 145 promulgated under the Securities
Act. Directors and executive officers of the Bank are deemed to be control
persons in accordance with Rule 145. However, such persons will not be deemed
underwriters of the common stock of the Holding Company acquired in the
reorganization if the securities are resold in accordance with certain specified
provisions of Rule 144 promulgated under the Securities Act.
Rule 144 provides that in order for securities to be sold in accordance
with the Rule there must be available adequate public information with respect
to the issuer of such securities. This public information will be deemed
available if the issuer has securities registered pursuant to Section 12 of the
Securities Exchange Act of 1934 (the "Exchange Act") and has been subject to the
reporting requirements of Section 12 of the Exchange Act for a period of at
least 90 days immediately preceding the sale of such securities and has filed
all the reports required to be filed thereunder during the 12 months preceding
the sale. Adequate public information with respect to the issuer of the
securities will also be deemed available if the issuer has securities registered
pursuant to the Securities Act, has been subject to the reporting requirements
of Section 15(d) of the Exchange Act for a period of at least 90 days
immediately preceding the sale of securities and has filed all reports required
to be filed thereunder during the 12 months preceding such sale. The Holding
Company will not be subject to the reporting requirements of Section 15(d) of
the Exchange Act upon consummation of the reorganization.
8
<PAGE>
Rule 144 also provides that any person who controls, or who is a member of
a group which controls, or is under common control with the issuer cannot sell,
within any 3 month period, restricted or other securities of the same class in
an aggregate amount greater than (I) 1% of the shares of that class outstanding
or (ii) the average weekly reported trading volume of the securities during the
four calendar weeks immediately preceding the sale. The securities sold in
accordance with Rule 144 must also be sold in broker's transactions executed
upon a customer's order on an exchange or in the over-the-counter market, or in
transactions directly with a market maker. The owner of the securities must not
solicit orders to buy the securities, or make any payment in connection with the
offer or sale of the securities to any person other than the broker who executes
the order to sell the securities. If the amount of any securities sold pursuant
to Rule 144 during any 3 month period exceeds 500 shares or has an aggregate
sales price in excess of $10,000, three copies of the notice of sale on Form 144
must be filed with the Securities and Exchange Commission.
THIS PROXY STATEMENT/PROSPECTUS, WHICH ALSO SERVES AS A PROSPECTUS WITH RESPECT
TO THE SHARES OF COMMON STOCK OF THE HOLDING COMPANY ISSUABLE IN THE
REORGANIZATION, DOES NOT RELATE TO ANY RESALES OF THE COMMON STOCK OF THE
COMPANY RECEIVED BY SHAREHOLDERS PURSUANT TO THE REORGANIZATION, AND NO PERSON
IS AUTHORIZED TO MAKE USE OF THIS PROXY STATEMENT/PROSPECTUS IN CONNECTION WITH
ANY SUCH RESALES.
RIGHTS OF DISSENTING SHAREHOLDERS
THE FOLLOWING DISCUSSION IS A SUMMARY OF CERTAIN STATUTORY PROVISIONS. THIS
SUMMARY DOES NOT PURPORT TO BE COMPLETE AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE COPY OF THE COMPLETE TEXT OF SECTION 658.44 OF THE FLORIDA
BANKING CODE ATTACHED AS ATTACHMENT B TO EXHIBIT A TO THIS PROXY
STATEMENT/PROSPECTUS.
Pursuant to the provisions of Section 658.44 of the Florida Banking Code,
any shareholder of record of the Bank is entitled to dissent from the Merger
Agreement and obtain payment of the fair market value of his shares of common
stock of the Bank in cash if the reorganization is effected. With respect to the
dissenter's shares, "fair market value" means the value of the Bank's shares on
the effective date of the reorganization.
A shareholder of record entitled to dissent from the reorganization and
obtain payment of fair market value of his shares of common stock in the Bank,
must perfect his rights as a dissenter in accordance with the Florida Banking
Code. A dissenting shareholder will be entitled to payment in cash of the value
of only those shares held by the stockholder:
(I) which at the special meeting of shareholders are voted against the
approval of the Merger Agreement; or
(ii) with respect to which the stockholder has given written notice to the
Bank at or prior to the special meeting that the shareholder dissents from
the Merger Agreement.
A shareholder desiring to file a written notice of his intent to dissent
send such notice to: TIB Bank of the Keys, Attn: Edward V. Lett, President,
99451 Overseas Highway, Key Largo, Florida 33037.
9
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
IN VIEW OF THE COMPLEXITY OF THE LAWS AND INTERPRETATIONS THEREOF,
SHAREHOLDERS OF THE BANK SHOULD CONSULT WITH AND RELY ONLY ON THE ADVICE OF
THEIR TAX ADVISORS ON MATTERS RELATING TO THE CONVERSION OF COMMON STOCK IN THE
BANK FOR COMMON STOCK OF THE HOLDING COMPANY AND SHOULD NOT CONSIDER THIS
SUMMARY AS A SUBSTITUTE FOR CAREFUL AND INDIVIDUAL TAX PLANNING.
The income tax treatment of the conversion of common stock pursuant to a
reorganization involves technical and not completely settled principles of
taxation. Consequently, it is impractical to present herein a detailed
explanation of the income tax treatment of shareholders as a result of the
reorganization. In addition, the following discussion is intended to be a
summary of certain relevant principles of federal income taxation and a
statement of the material tax issues associated with the reorganization which
should be carefully considered by shareholders prior to voting on the
reorganization. The following discussion is based upon counsel's analysis and
interpretation of the Internal Revenue Code of 1986, as amended), and Treasury
Regulations promulgated thereunder, Internal Revenue Service ("Service")
procedures and rulings and Court decisions published as of the date of this
Proxy Statement/Prospectus. No assurance can be given that such authorities will
not be modified by legislative action, administrative action or judicial review.
Any such changes may be retroactive so as to apply to transactions prior to the
date of such changes and could modify such discussion and adversely affect the
tax aspects described herein.
The reorganization has been structured to qualify as a tax-free
reorganization under Sections 368(a)(l)(A) and 368(a)(2)(E) of the Code. The
consummation of the reorganization is subject to, among other matters, receipt
of an opinion from Holland & Knight, special counsel to the Holding Company and
the Bank, to the effect that the reorganization will be treated as a tax-free
transaction, with the following federal income tax consequences:
(1) Neither the Bank, Interim nor the Holding Company will recognize any
gain or loss as a result of the reorganization;
(2) No gain or loss will be recognized to the shareholders of the Bank
upon conversion of their shares; the tax basis of shares of the Holding
Company's common stock received in the reorganization will be the same as
the tax basis of the shares of the Bank's common stock previously owned;
and if the shares of the Bank's common stock were held as capital assets,
the holding period of the shares of Holding Company's common stock received
will include the holding period of the shares of the Bank's common stock
exchanged therefor; and
(3) A shareholder of the Bank who exercises his rights as a dissenter and
thereby receives cash for his shares will recognize income, gain or loss
measured by the difference between the amount of cash received and the tax
basis of his shares of the Bank's common stock, subject to the provisions
of Code Section 302. Such distributions will generally be treated as
capital gain or loss if the shares were held as capital assets. However, a
dissenting shareholder must take into account the effect that Sections 302
and 318 of the Code may have in determining consequences of the transaction
if he receives only cash, which could cause the distributions to be treated
as ordinary income or, possibly, as a dividend to the dissenter.
The shareholders of the Bank should also be aware that state and local
income taxes may affect their tax situation. While many state and local income
tax statutes correspond with the federal income tax laws, no attempt is made
herein to describe any state or local income tax consequences resulting from the
reorganization. SHAREHOLDERS ARE URGED TO CONSULT THEIR PERSONAL TAX ADVISORS
WITH RESPECT TO ANY EFFECTS OF STATE AND LOCAL TAX LAWS.
10
<PAGE>
In the case of a corporate shareholder of the Bank, the tax consequences
described herein are generally applicable, although no attempt is made herein to
discuss the tax ramifications with respect to a corporate shareholder. This
discussion herein assumes that each shareholder of the Bank is a natural person,
except as otherwise noted. All corporations, trusts, or other entities, are
urged to consult their own tax advisors.
11
<PAGE>
TRADING MARKET
COMPANY
Prior to the reorganization, there has been no public market for the common
stock of the Holding Company and there can be no assurance that an active
trading market will develop as a result of the reorganization. The Holding
Company has no arrangement with any securities dealer concerning the maintenance
of a trading market in its securities.
BANK
There has been no established trading market for the common stock of the
Bank to date. The Bank has no arrangement with any securities dealer concerning
the maintenance of a trading market in its securities. The Bank has
approximately 460 shareholders.
12
<PAGE>
TIB FINANCIAL CORP.
UNAUDITED CONDENSED PRO FORMA CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1995
<TABLE>
<CAPTION>
CONSOLIDATION
TIB BANK OF TIB FINANCIAL REORGANIZATION ELIMINATION PRO FORMA
THE KEYS CORP. ADJUSTMENTS ADJUSTMENTS CONSOLIDATED
<S> <C> <C> <C> <C> <C>
ASSETS
Cash due from financial institutions $8,542,945 $150,000 /(2)/ $ (10) /(4)/ $ (150,000) $8,542,945
/(3)/ 10
Investment securities held to maturity
(market value of $10,619,000) 10,116,000 -- -- -- 10,116,000
Investment securities available for sale 50,844,888 -- -- -- 50,844,888
Investment in subsidiary /(1)/ 21,063,146 /(5)/ (21,063,146)
-- 10 /(3)/ (10) -- --
Federal funds sold and securities
purchased under agreement to resell 587,000 -- -- -- 587,000
Loans 138,369,991 -- -- -- 138,369,991
Reserve for loan losses ( 1,700,823) -- -- -- ( 1,700,823)
----------- ------ ------ ------ ----------
Loans, net of valuation reserve and
unearned income 136,669,168 -- -- -- 136,669,168
Bank premises and equipment 8,570,271 -- -- -- 8,570,271
Accrued interest receivable 1,709,057 -- -- -- 1,709,057
Other assets 2,527,326 -- -- -- 2,527,326
----------- ------ ------ ------ -----------
Total Assets $219,566,655 $150,010 $21,063,136 $(21,213,146) $219,566,655
=========== ======= ========== ========== ===========
LIABILITIES
Deposits:
Noninterest-bearing demand $34,247,739 -- -- /(4)/ $ (150,000) $34,097,739
Interest-bearing demand and money market 67,834,751 -- -- -- 67,834,751
Savings 17,545,775 -- -- -- 17,545,775
Time deposits of $100,000 or more 22,329,989 -- -- -- 22,329,989
Other time deposits 51,161,580 -- -- -- 51,161,580
------ ------ ------
Total deposits $193,119,834 -- -- (150,000) $192,969,834
=========== ====== ====== ======= ===========
Federal funds purchased and securities sold
under agreement to repurchase $3,521,806 -- -- -- $3,521,806
Other borrowings -- 150,000 -- -- 150,000
Other liabilities 1,861,869 -- -- -- 1,861,869
---------- -------- ------ ------- ----------
Total Liabilities 198,503,509 150,000 -- (150,000) 198,503,509
----------- -------- ------ ------- -----------
Subordinated notes and debentures -- -- -- -- --
STOCKHOLDERS' EQUITY
Common stock 1,774,360 .10 /(1)/ 141,949 /(5)/ (1,774,360) 141,949
/(2)/ (.10)
Surplus 4,447,133 9.80 /(1)/ 6,079,544 /(5)/ (4,447,133) 6,079,544
/(2)/ (9.80)
Retained earnings 14,663,648 -- /(1)/ 14,663,648 /(5)/ (14,663,648) 14,663,648
.10 /(2)/ (.10)
Unrealized gain on securities available for sale 178,005 -- 178,005 (178,005) 178,005
---------- -------- --------- ------- ----------
Total Stockholders' Equity 21,063,146 10 21,063,136 (21,063,146) 21,063,146
----------- -------- ---------- ---------- -----------
Total Liabilities and Stockholders' Equity $219,566,655 $150,010 $21,063,136 $(21,213,146) $219,566,655
=========== ======== ========== ========== ===========
</TABLE>
13
<PAGE>
TIB FINANCIAL CORP.
ADJUSTMENT LEGEND FOR UNAUDITED CONDENSED PRO FORMA
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1995
REORGANIZATION ADJUSTMENTS
- --------------------------
/(1)/ Exchange of 1,419,488 shares of $.10 par value TIB Financial Corp.
common stock for 1,419,488 shares of TIB Bank of the Keys common
stock.
/(2)/ Repurchase and retirement of original incorporating shares of TIB
Financial Corp. common stock.
/(3)/ Retirement of original incorporating shares of TIB Interim Corp. common
stock.
CONSOLIDATION ELIMINATION ADJUSTMENTS
- -------------------------------------
/(4)/ Elimination of TIB Financial Corp. demand deposit account and cash in
TIB Bank of the Keys.
/(5)/ Elimination of TIB Financial Corp.'s investment in TIB Bank of the Keys.
NOTE TO CONDENSED PRO FORMA CONSOLIDATED BALANCE SHEET
- ------------------------------------------------------
1) Subsequent to December 31, 1995, the Bank effected a two-for-one stock
split in the form of a share dividend. The pro forma combined balance sheet
reflects this stock split. Prior to the split, the Bank had 709,744 shares
outstanding with a par value of $1.25 per share. As a result of the split,
the outstanding shares increased from 709,744 to 1,419,488 with a par value
of $1.25 per share. Additional paid in capital was reduced $887,180 as a
result of the split.
2) In connection with the formation of TIB Financial Corp., a line of credit
totalling $150,000 was established. This note carries an interest rate of
prime plus 50 basis points and a term of one year. The effect this line of
credit would have reduced net income (net of income taxes, using a 35% tax
rate) for 1995, assuming that the transaction had occurred at the beginning
of the period, are shown below:
<TABLE>
<CAPTION>
Without Note Payable With Note Payable
----------------------------- --------------------------
<S> <C> <C>
Net income $3,000,943 $2,992,336
Earnings per share - without $4.24/(1)/ $4.23/(1)/
stock split
Earnings per share - with $2.12/(1)/ $2.11/(1)/
stock split
</TABLE>
/(1)/ The weighted average common shares outstanding was 707,697 at December
31, 1995, assuming no stock split, and 1,415,394 with the stock split.
14
<PAGE>
BUSINESS OF THE BANK
TIB BANK OF THE KEYS
TIB Bank of the Keys is a state-chartered commercial bank headquartered
in Key Largo, Florida. The Bank's deposits are insured by the FDIC.
The primary business of the Bank is attracting deposits from the public
and using such deposits to make real estate, business and consumer loans. As of
March 31, 1996, the Bank had total assets of approximately $230.1 million, total
deposits of approximately $206.0 million, and shareholders' equity of
approximately $21.3 million. The Bank's primary service area includes Monroe
County, Florida.
BANKING OFFICES
The Bank's business is conducted at its main banking office at 99451
Overseas Highway, Key Largo, Florida, where its principal executive offices are
located. The Bank maintains branches located at: 10330 Overseas Highway, Key
Largo, Florida; 91980 Overseas Highway, Tavernier, Florida; 80900 Overseas
Highway, Tavernier, Florida; 11401 Overseas Highway, Marathon Shores, Florida;
2315 Overseas Highway, Marathon, Florida; Mile Marker 30.4, Big Pine Key,
Florida; 330 Whitehead Street, Key West, Florida; and 3322 N. Roosevelt
Boulevard, Key West, Florida.
BANKING SERVICES
The Bank offers a full range of commercial banking services to
individual, professional and business customers in its primary service area.
These services include savings accounts, money market checking accounts and NOW
accounts, certificates of deposit and other time deposits, commercial, real
estate and installment loans, and safe deposit facilities. Customer deposits are
insured to the maximum extent provided by law through the BIF. The Bank pays
interest on its accounts and certificates competitive with other financial
institutions in its primary service area. The Bank seeks to attract deposits
from the public and uses such deposits, together with borrowings and other
sources of funds, to make real estate, business and consumer loans. The Bank
seeks to concentrate its deposits and loan efforts primarily within its primary
service area.
COMPETITION
The Bank experiences competition in attracting deposits and in making
real estate, business and consumer loans in its primary service area. The
primary factors in competing for deposits are interest rates, the range of
financial services offered, convenience of office locations and flexible office
hours. Direct competition for such deposits comes from other commercial banks,
savings institutions, credit unions, brokerage firms and money market funds. The
primary factors in competing for loans are interest rates, loan origination fees
and the range of lending services offered. Competition for origination of loans
normally comes from other commercial banks, savings institutions, credit unions
and mortgage banking firms. Such entities may have competitive advantages as a
result of greater resources and higher lending limits (by virtue of their
greater capitalization). However, the Bank seeks to attract customers in its
primary service area with its products and services which are tailored to the
needs of the customers. Management seeks to emphasize a high degree of
personalized client service in order to be able to better meet the banking needs
of its customers.
EMPLOYEES
At March 31, 1996, the Bank had 145 full-time and six part-time
employees. The Bank considers its relationship with its employees to be good.
15
<PAGE>
LEGAL PROCEEDINGS
There are no pending material legal proceedings in which the Bank is
involved.
BUSINESS OF THE COMPANY
The Holding Company is a new Florida bank holding company organized in
February 1996. Upon consummation of the proposed reorganization, the Holding
Company's primary asset will be 100% of the outstanding common stock of the
Bank. The Holding Company was organized at the direction of the Bank's Board of
Directors for the purpose of effecting the proposed reorganization transaction
with the Bank and has not engaged in any active business operations. The Holding
Company is in the process of forming a wholly-owned subsidiary, Interim, for the
purpose of effecting the reorganization with the Bank. Interim has not engaged
in any active business or banking operations. If the reorganization is approved,
the Holding Company will cause Interim to be merged into the Bank with the Bank
as the surviving entity and with Interim ceasing to exist as a separate entity.
The Holding Company's executive offices are located at the Bank's main
banking office at 99451 Overseas Highway, Key Largo, Florida 33037. The
Holding Company does not have any full-time employees.
SUPERVISION AND REGULATION
The Holding Company will be subject to substantial regulation as a bank
holding company, and the Bank is currently subject to substantial regulation.
The following summaries of statutes and regulations affecting bank holding
companies and banks do not purport to be complete. Such summaries are qualified
in their entirety by reference to such statutes and regulations.
SUPERVISION AND REGULATION OF THE COMPANY
The Holding Company will be a bank holding company within the meaning of
the federal Bank Holding Company Act (the "Act"). As a bank holding company, the
Holding Company will be subject to supervision and regulation by the Board of
Governors of the Federal Reserve System (the "Board") under the Act. The Board
may make examinations of the Holding Company and each of its subsidiaries. Bank
holding companies are required by the Act to obtain approval from the Board
prior to acquiring, directly or indirectly, ownership or control of more than 5%
of the voting shares of a bank.
The Act also prohibits bank holding companies, with certain exceptions,
from acquiring more than 5% of the voting shares of any company that is not a
bank, from engaging in any business other than a business closely related to
banking (as determined by the Board) or managing or controlling banks and other
subsidiaries authorized by the Act without the prior approval of the Board. The
Board may differentiate between activities that are initiated de novo by a bank
holding company or a subsidiary and activities commenced by acquisition of a
going concern. The Holding Company has no present intention to engage in
nonbanking activities.
As a bank holding company, the Holding Company is subject to capital
adequacy guidelines as established by the Board. The Board established risk
based capital guidelines for bank holding companies effective March 15, 1989.
Beginning on December 31, 1992, the minimum required ratio for total capital to
risk weighted assets became 8 percent (of which at least 4 percent must consist
of Tier 1 capital). Tier 1 capital (as defined in regulations of the Board)
consists of common shareholders equity and qualifying preferred stock and
minority interests in equity accounts of consolidated subsidiaries, less
goodwill and other intangible assets required to be deducted under the Board's
guidelines. The Board's guidelines apply on a consolidated basis to bank holding
companies with total consolidated assets of $150 million or more. These
guidelines will apply to the Holding
16
<PAGE>
Company if the reorganization is consummated. The Board has stated that risk
based capital guidelines establish minimum standards and that bank holding
companies generally are expected to operate well above the minimum standards.
Bank holding companies may be compelled by bank regulatory authorities to
invest additional capital into a subsidiary bank in the event the subsidiary
bank experiences either significant loan losses or rapid growth of loans or
deposits. In addition, the Holding Company may be required to provide additional
capital to any additional banks it acquires as a condition to obtaining the
approvals and consents of regulatory authorities in connection with such
acquisitions.
The Holding Company is an "affiliate" of the Bank within the meaning of
the Federal Reserve Act, which imposes restrictions on loans to the Holding
Company by the Bank, investments by the Bank in securities of the Holding
Company and on the use of such securities as collateral security for loans by
the Bank to any borrower. The Federal Reserve Act will limit the transfer of
funds by the Bank to the Holding Company and its nonbanking subsidiaries,
whether in the form of loans, extensions of credit, investments or asset
purchases. Such transfers by the Bank to the Holding Company or any nonbanking
Holding Company subsidiary are limited in amount to 10% of the Bank's capital
and surplus and, with respect to the Holding Company and all such nonbanking
subsidiaries, to an aggregate of 20% of the Bank's capital and surplus.
Furthermore, such loans and extensions of credit are required to be secured in
the specified amounts.
The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
(the "Interstate Banking Act"), subject to certain restrictions, allows
adequately capitalized and managed bank holding companies to acquire existing
banks across state lines, regardless of state statutes that would prohibit
acquisitions by out-of-state institutions. Further, effective June 1, 1997, a
bank holding company may consolidate interstate bank subsidiaries into branches
and a bank may merge with an unaffiliated bank across state lines to the extent
that the applicable states have not "opted out" of interstate branching prior to
such effective date. Some states may elect to permit interstate mergers prior to
June 1, 1997. The Interstate Banking Act also permits de novo branching to the
-- ----
extent that a particular state "opts into" the de novo branching provisions. The
-- ----
Interstate Banking Act generally prohibits an interstate acquisition (other than
an initial entry into a state by a bank holding company) that would result in
either the control of more than (I) 10% of the total amount of insured deposits
in the United States or (ii) 30% of the total insured deposits in the home state
of the target bank, unless such 30% limitation is waived by the home state on a
basis which does not discriminate against out-of-state institutions. As a result
of this and prior legislation, the Holding Company may become a candidate for
acquisition by, or may itself seek to acquire, banking organizations located in
other states.
The Holding Company is a legal entity separate and distinct from the
Bank. In contrast to the Bank's common stock, the stock of the pending Company
is subject to the registration requirements of the Securities Act of 1933.
SUPERVISION AND REGULATION OF THE BANK
The Bank is a state banking corporation organized under the laws of the
State of Florida. The operations of the Bank are subject to state and federal
statutes applicable to state chartered banks whose deposits are insured by the
FDIC and the regulations of the Florida Department of Banking and Finance (the
"DBF") and the FDIC. Such statutes and regulations relate to, among other
things, required reserves, permissible investments, lending limitations and
procedures, mergers and consolidations, issuances of securities, payment of
dividends, establishment of branches and other aspects of the Bank's operations.
The Bank is subject to regularly scheduled examinations by the DBF and the FDIC.
In addition, and as discussed above under "Supervision and Regulation of the
Company," the Federal Reserve Act restricts extensions of credit by the Bank to
affiliates, such as the Holding Company or, with certain exceptions, other
affiliates, and on the taking of such stock or securities as collateral on
17
<PAGE>
loans to any borrower. The Bank is prohibited from engaging in certain tie-in
arrangements in connection with any extension of credit or the providing of any
property or service.
Effective December 31, 1990, the FDIC adopted final risk-based capital
guidelines for all FDIC insured state chartered banks that are not members of
the Federal Reserve System. Beginning on December 31, 1992, all banks were
required to maintain a minimum ratio of total capital to risk weighted assets of
8 percent (of which at least 4 percent must consist of Tier 1 capital). Tier 1
capital of state chartered banks (as defined in regulations) generally consists
of (I) common stockholders equity; (ii) noncumulative perpetual preferred stock
and related surplus; and (iii) minority interests in the equity accounts of
consolidated subsidiaries.
In addition, the FDIC adopted a minimum ratio of Tier 1 capital to total
assets of banks. This capital measure is generally referred to as the leverage
capital ratio. The FDIC has established a minimum leverage capital ratio of 3
percent if the FDIC determines that the institution is not anticipating or
experiencing significant growth and has well-diversified risk, including no
undue interest rate exposure, excellent asset quality, high liquidity, good
earnings and, in general, is considered a strong banking organization, rated
Composite 1 under the Uniform Financial Institutions Rating System. Other
financial institutions are expected to maintain leverage capital at least 100 to
200 basis points above the minimum level. At December 31, 1995, the Bank
exceeded the minimum Tier 1, risk-based and leverage capital ratios.
The Federal Deposit Insurance Corporation Improvement Act of 1991,
enacted in December 1991 ("FDICIA"), specifies, among other things, the
following capital standard categories for depository institutions: well
capitalized, adequately capitalized, undercapitalized, significantly
undercapitalized and critically undercapitalized. FDICIA imposes progressively
more restrictive constraints on operations, management and capital distributions
depending on the category in which an institution is classified. Each of the
federal banking agencies has issued final uniform regulations that became
effective December 19, 1992, which, among other things, define the capital
levels described above. Under the final regulations, a bank is considered "well
capitalized" if it (I) has a total risk-based capital ratio of 10% or greater,
(ii) has a Tier 1 risk-based capital ratio of 6% or greater, (iii) has a
leverage ratio of 5% or greater, and (iv) is not subject to any order or written
directive to meet and maintain a specific capital level for any capital measure.
An "adequately capitalized" bank is defined as one that has (I) a total risk-
based capital ratio of 8% or greater, (ii) a Tier 1 risk-based capital ratio of
4% or greater and (iii) a leverage ratio of 4% or greater (or 3% or greater in
the case of a bank with a composite CAMEL rating of 1). A bank is considered
"undercapitalized" if it has (I) a total risk-based capital ratio of less than
8%, (ii) a Tier 1 risk-based capital ratio of less than 4%, or (iii) a leverage
ratio of less than 3%, and "critically undercapitalized" if the bank has a ratio
of tangible equity to total assets equal to or less than 2%. The applicable
federal regulatory agency for a bank that is "well capitalized" may reclassify
it as "adequately capitalized" or "undercapitalized" institution to the
supervisory actions applicable to the next lower capital category, if it
determines that the bank is in an unsafe or unsound condition or deems the bank
to be engaged in an unsafe or unsound practice and not to have corrected the
deficiency. As of December 31, 1995, the Bank met the definition of a "well
capitalized" institution.
"Undercapitalized" depository institutions, among other things, are
subject to growth limitations, are prohibited, with certain exceptions, from
making capital distributions, are limited in their ability to obtain funding
from a Federal Reserve Bank and are required to submit a capital restoration
plan. The federal banking agencies may not accept a capital plan without
determining, among other things, that the plan is based on realistic assumptions
and is likely to succeed in restoring the depository institution's capital. In
addition, for a capital restoration plan to be acceptable, the depository
institution's parent holding company must guarantee that the institution will
comply with such capital restoration plan and provide appropriate assurances of
performance. If a depository institution fails to submit an acceptable plan,
including if the holding company refuses or is unable to make the guarantee
described in the previous sentence, it is treated as if it is "significantly
undercapitalized." Failure to submit or implement an acceptable capital plan
also is grounds for the appointment of a conservator or a receiver.
"Significantly undercapitalized" depository institutions may be subject to a
number of additional
18
<PAGE>
requirements and restrictions, including orders to sell sufficient voting stock
to become adequately capitalized, requirements to reduce total assets and
cessation of receipt of deposits from correspondent banks. "Critically
undercapitalized" institutions, among other things, are prohibited from making
any payments of principal and interest on subordinated debt, and are subject to
the appointment of a receiver or conservator.
Under FDICIA, the FDIC is permitted to provide financial assistance to an
insured bank before appointment of a conservator or receiver only if (I) such
assistance would be the least costly method of meeting the FDIC's insurance
obligations, (ii) grounds for appointment of a conservator or a receiver exist
or are likely to exist, (iii) it is unlikely that the bank can meet all capital
standards without assistance and (iv) the bank's management has been competent,
has complied with applicable laws, regulations, rules and supervisory directives
and has not engaged in any insider dealing, speculative practice or other
abusive activity.
FURTHER CHANGES IN REGULATORY REQUIREMENTS
The United States Congress and the Florida legislature have periodically
considered and adopted legislation that has resulted in deregulation of, among
other matters, banks and other financial institutions, or adversely affected the
profitability of the banking industry. Future legislation could further modify
or eliminate geographic restrictions on banks and bank holding companies and
current prohibitions with other financial institutions, including mutual funds,
securities brokerage firms, insurance companies, banks from other states and
investment banking firms. The effect of any such legislation on the business of
the Holding Company or the Bank cannot be accurately predicted. The Holding
Company also cannot predict what legislation might be enacted or what other
implementing regulations might be adopted, and if enacted or adopted, the effect
thereof.
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
directors and executive officers of the Holding Company and the Bank as of April
15, 1996:
<TABLE>
<CAPTION>
Position with Position with
Name Age the Company the Bank
- ---- --- ------------- --------------
<S> <C> <C> <C>
B.G. Carter 53 Director Director
William Eldon Chasteen 71 Director Director
Armando J. Henriquez 61 Director Director
James R. Lawson, III 62 Director Director
Edward V. Lett 50 Director, President Director, President
and CEO and CEO
Scott A. Marr 41 Director Director
W. Kenneth Meeks 68 Director and Chairman Director and Chairman
Derek D. Martin-Vegue 49 Director Director
Joseph H. Roth, Jr. 49 Director Director
</TABLE>
19
<PAGE>
<TABLE>
<S> <C> <C> <C>
Richard J. Williams 75 Director Director
</TABLE>
The members of the Board of Directors of the Holding Company are elected
by the shareholders. The directorships of the Holding Company are divided into
three classes, with the members of each class serving three-year terms and the
shareholders electing one class annually. The directors of the Holding Company
were first elected to the Board in 1996 and serve initial staggered terms of
one, two and three years. The terms of the current directors expire as follows:
the terms of directors Chasteen, Meeks and Williams expire in 1997; the terms of
directors Carter, Henriquez and Lawson expire in 1998; and the terms of
directors Lett, Marr, Martin-Vegue and Roth expire in 1999. The first annual
meeting of shareholders of the Holding Company at which directors will be
elected will be held in 1997.
The members of the Board of Directors of the Bank will be elected
annually by the Holding Company as the sole shareholder of the Bank if the
proposed reorganization is completed.
The business experience of each of the directors and executive officers
of the Holding Company and the Bank is set forth below.
B. G. CARTER is the Managing Director of the Independent Companies which
engage in the title insurance, residential and commercial property insurance and
mortgage brokerage businesses. Mr. Carter is also the owner of Westwinds, a
twenty-two unit guest house in Key West. Mr. Carter has served as a director of
the Bank since 1988.
WILLIAM ELDON CHASTEEN is now retired. He was the owner of Ace Hardware
Stores in Key Largo and Tavernier until selling them in 1995. He has served as a
director of the Bank since 1983.
ARMANDO J. HENRIQUEZ has served as Vice President of Client Relations of
Fringe Benefits Management Company since September of 1993. Mr. Henriquez served
as a consultant to the Florida Association of School Superintendents from
January of 1993 until joining Fringe Benefits Management Company. Mr. Henriquez
served as Superintendent of Schools of Monroe County, Florida from January 1969
to December 1992.
JAMES R. LAWSON is now retired. He was the owner of the Key Largo
Shopper, a grocery store in Key Largo, prior to its sale in 1994. Mr. Lawson has
served as a director of the Bank since 1988.
EDWARD V. LETT has been the President and Chief Executive Officer of the
Bank since January 6, 1996 and has served as a director since 1992. Prior to
becoming President, Mr. Lett served as Executive Vice President and Chief
Operating Officer of the Bank since joining the Bank in November 1991. Prior to
joining the Bank, Mr. Lett had served as Executive Vice President and Chief
Operating Officer of American National Bank of Florida.
SCOTT A. MARR has been the General Manager and a Partner of Marina-Del
Mar Resorts, which consists of two hotels in Key Largo, Florida, for more than
five years. Mr. Marr has served as a director of the Bank since 1994.
W. KENNETH MEEKS has been the Chairman of the Bank since 1976. Mr. Meeks
retired as Chief Executive Officer of the Bank in 1988, and served as the Bank's
acting Chief Executive Officer from September 1995 through January 5, 1996. Mr.
Meeks has served as a director of the Bank since 1974.
DEREK D. MARTIN-VEGUE has been the President of Keys Insurance Agency of
Monroe County, Inc. for more than five years. He has served as a director since
1995.
20
<PAGE>
JOSEPH H. ROTH, JR. has been Managing Owner of Holiday Isle Resorts and
Marina, and the General Partner of Little Palm Island Resorts, for more than
five years. Mr. Roth became a director in 1980.
RICHARD J. WILLIAMS has been a professional fishing guide for over 50
years, and has also owned and operated the Coral Cove Resort on Islamorada. He
became a director upon organization of the Bank in 1974.
COMPENSATION
The following sets forth certain information concerning the compensation
of the Bank's chief executive officer during fiscal years 1995, 1994 and 1993.
No other executive officer received annual compensation in excess of $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
Annual Compensation Awards Payouts
------------------- ------ -------
Other Annual Securities All Other
Name and Principal Fiscal Compensation Underlying Compensation
Position Year Salary ($) Bonus ($) ($)/(1)/ Options (#) ($)/(2)/
-------- ---- ---------- --------- -------- ----------- --------
<S> <C> <C> <C> <C> <C> <C>
Edward V. Lett 1995 $123,627 $14,216 $16,600 -- $1,545
President and Chief
Executive Officer/(3)/
W. Kenneth Meeks 1995 $ 12,500 -- $16,600 -- --
Chairman of the Board;
Former Interim CEO/(4)/
Richard A. Drake 1995 $100,899 $12,178 $35,204 -- $1,000
Former President and
CEO/(5)/
Gregory S. Bills 1995 $100,000 $12,067 $ 5,600 -- --
Senior Vice President
</TABLE>
/(1)/ Includes (I) quarterly retainer and fees for attending Board of
Directors meetings paid to all directors including Messrs. Lett, Meeks
and Drake, (ii) as regards Mr. Drake, payments of $23,504 under a
settlement and noncompetition agreement entered into in connection with
his severance, and (iii) amounts paid to Mr. Bills as a car allowance.
Compensation does not include any other perquisites and other personal
benefits which may be derived from business-related expenditures that in
the aggregate exceed the lesser of $50,000 or 10% of the total annual
salary and bonus reported for such person.
/(2)/ The reported amount consists of matching contributions to the Bank's
401(k) and Employee Stock Ownership Plan.
/(3)/ Mr. Lett became the Bank's President and CEO on January 6,1996, and
served as the Bank's Executive Vice President and Chief Operating
Officer during 1995.
/(4)/ Mr. Meeks served as the Bank's interim CEO from September 26, 1995
through January 5, 1996 and received a salary at a rate equal to $50,000
during that period.
/(5)/ Mr. Drake served as the Bank's President and CEO through September 25,
1995.
The following table sets forth information with respect to the named
executives concerning unexercised options held as of December 31, 1995. No
options were granted to or exercised by such executives during 1995.
21
<PAGE>
AGGREGATE OPTION EXERCISES IN 1995 AND DECEMBER 31, 1995 OPTION VALUES
<TABLE>
<CAPTION>
Shares Number of Securities Value of
Acquired Underlying Unexercised Unexercised In-the-Money
on Options at 12/31/95 Options at 12/31/95/(1)/
------------------- --------------------------
Name Exercise Value Realized Exercisable Unexercisable Exercisable Unexercisable
---- -------- --------------- ----------- -------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Edward V. Lett 0 0 2,700 24,300 $17,280 $155,520
W. Kenneth Meeks 0 0 10,000 0 $64,000 0
Richard A. Drake 0 0 0 0 0 0
Gregory S. Bills 0 0 800 7,200 $ 5,120 $ 46,080
</TABLE>
/(1)/ Based on a fair market value of $22.875 per share as of that date and
exercise prices per share of $16.475.
EMPLOYMENT AGREEMENT
The Bank and Edward V. Lett, the President and Chief Executive Officer of
the Holding Company and the Bank, are parties to an "Executive Employment
Agreement." Under the agreement, Mr. Lett receives a base salary of $116,630 per
year. The Bank may increase Mr. Lett's salary annually based on Mr. Lett's
performance. The agreement provides that Mr. Lett will be employed by the Bank
on an "at-will" basis, unless and until there is a change of ownership control
of the Bank. In the event there is a change of ownership control of the Bank,
Mr. Lett will no longer be an at-will employee and the agreement will become an
employment agreement for a term of 24 months on the effective date of the change
in ownership control. Mr. Lett's salary cannot be reduced for any reason during
this 24 month term, unless the agreement is terminated due to the death or
incapacity of Mr. Lett or for "cause." The agreement further provides that Mr.
Lett will be entitled to a credit for all years of service with the Bank (i.e.,
----
all years prior to the change in ownership control, plus the greater of 24
months or the actual period of employment after the change in ownership control)
in determining eligibility for and benefits from any and all retirement,
disability, profit-sharing and other employee benefit programs offered by the
Bank.
COMPENSATION TO DIRECTORS
All of the members of the Board of Directors of the Bank receive a
quarterly retainer of $2,500 and $600 for attending each of 11 regular board
meetings, for a total of up to $16,600 annually. Each member of the Board of
Directors has also received a grant of an option to purchase 10,000 shares of
the Bank's common stock at an exercise price of $16.475 per share, except for a
more recent grant to Mr. Martin-Vegue with an exercise price of $18.70 per
share. Management anticipates that Board meetings of the Holding Company, when
called, would be held in conjunction with Board meetings of the Bank. No
additional compensation will be paid to the directors of the Holding Company.
The Board of Directors of the Holding Company does not have any standing
committees. The Board of Directors of the Bank has an Audit Committee, an
Executive Committee, a Salary Review Committee, a Loan Committee and an
Investment/Strategic Planning Committee.
LIMITATION ON DIRECTORS' LIABILITY
The Holding Company's Articles of Incorporation contain a provision which
eliminates or limits the personal liability of directors to the Holding Company
or its shareholders for monetary damages for certain breaches of their duty of
care or other duty. This provision provides that a director of the Holding
Company shall not be personally liable for monetary damages for a breach of his
duty of care or other duty as a director, except for liabilities for (I) any
appropriation, in violation of the director's duties, of any business
opportunity of the Holding Company, (ii) acts or omissions not in good faith or
which involve intentional misconduct or a knowing
22
<PAGE>
violation of law, (iii) authorization of improper dividends or redemptions, or
(iv) any transaction from which the director derived an improper personal
benefit. Liability for monetary damages remains unaffected by such provision if
liability is based on any of these grounds. Liability for monetary damages for
violations of federal securities laws would also remain unaffected. The
provision does not eliminate a director's fiduciary duty, nor does it preclude a
shareholder from pursuing injunctive or other equitable remedies.
The Board of Directors believes this provision in the Holding Company's
Articles of Incorporation is essential to maintain and improve the ability of
the Holding Company to attract and retain competent directors.
INDEMNIFICATION
The Holding Company's Articles of Incorporation provide for the
indemnification of the directors, officers, employees and agents of the Holding
Company against certain liabilities and expenses that may be incurred by them to
the fullest extent permitted by Florida corporate law.
The Holding Company's Articles of Incorporation provide for
indemnification of directors and officers of the Holding Company for liability
and expenses reasonably incurred by them in connection with any civil, criminal,
administrative or investigative action, suit or proceeding in which they may
become involved by reason of being a director or officer of the Holding Company.
Indemnification is permitted if the director or officer acted in a manner he
believed in good faith to be in or not opposed to the best interests of the
Holding Company and, with respect to, in criminal actions, if he had no
reasonable cause to believe his conduct to be unlawful; provided that the
Holding Company may not indemnify any director (I) in connection with a
proceeding by or in the right of the corporation in which the director was
adjudged liable to the corporation or (ii) in connection with any other
proceeding in which he was adjudged liable on the basis that personal profit was
improperly received by him. Article 8 of the Holding Company's Articles of
Incorporation contains a provision providing for the indemnification of officers
and directors and advancement of expenses to the fullest extent authorized by
the Florida Business Corporation Act.
The Holding Company may seek to purchase and maintain directors and
officers liability insurance which insures against liabilities that directors
and officers of the Holding Company may incur in such capacities.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
Holding Company pursuant to the foregoing provisions, the Holding Company has
been informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in that Act and is
therefore unenforceable.
CERTAIN TRANSACTIONS
Certain of the executive officers, directors and principal shareholders
of the Bank and affiliates of such persons have, from time to time, engaged in
banking transactions with the Bank and are expected to continue such
relationships in the future. All loans or other extensions of credit made by the
Bank to such individuals were made 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 unaffiliated third
parties and did not involve more than the normal risk of collectibility or
present other unfavorable features. As of December 31, 1995, loans to executive
officers and directors of the Bank, including affiliates of such persons,
amounted to $7,519,273 in the aggregate.
23
<PAGE>
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information regarding the shares of
the common stock of the Bank owned as of the record date (I) by each person who
beneficially owns more than 5% of the shares of the common stock of the Bank,
(ii) by each of the Bank's directors, and (iii) by all directors and executive
officers as a group.
<TABLE>
<CAPTION>
Beneficial Ownership /(2)/
Number Percentage
Name /(1)/ of Shares Ownership
- ---- --------- ---------
<S> <C> <C>
5% shareholders:
- ---------------
W. Kenneth Meeks /(3)(4)/ 327,174 22.8%
Joseph H. Roth, Jr. 91,074 6.3%
Directors and Officers:
- ----------------------
B. G. Carter 6,010 *
William Eldon Chasteen /(3)(5)/ 45,722 3.2%
Armando J. Henriquez /(6)/ 12,502 *
James R. Lawson /(3)(7)/ 56,106 3.9%
Edward V. Lett /(3)/ 51,470 3.6%
Scott A. Marr 10,614 *
W. Kenneth Meeks /(3)(4)/ 327,174 22.8%
Derek D. Martin-Vegue 10,000 *
Joseph H. Roth, Jr. 91,074 6.3%
Richard J. Williams 13,760 *
All directors and
executive officers as
a group (11 persons)/(8)/ 545,370 36.4%
</TABLE>
______________
* Percent share ownership is less than 1% of total shares outstanding.
/(1)/ Except as otherwise indicated, the persons named in the above table
have sole voting and investment power with respect to all shares shown
as beneficially owned by them. Information relating to beneficial
ownership of the shares is based upon "beneficial ownership" concepts
set forth in the rules promulgated under the Securities and Exchange
Act of 1934, as amended. Under such rules, a person is deemed to be a
"beneficial owner" of a security if that person has or shares "voting
power" with respect to such security. The information as to beneficial
ownership has been furnished by the respective persons listed in the
above table.
/(2)/ Based on 1,426,288 shares outstanding as of the record date.
24
<PAGE>
/(3)/ Includes 26,354 shares of common stock of the Bank over which Messrs.
Chasteen, Lawson, Lett and Meeks exercise voting rights as co-trustees
under the Bank's 401(k) Savings and Employee Stock Ownership Plan.
/(4)/ Includes 122,292 shares as to which Mr. Meeks shares beneficial
ownership with his spouse.
/(5)/ Includes 13,052 shares as to which Mr. Chasteen shares beneficial
ownership with his spouse.
/(6)/ Includes 2,470 shares as to which Mr. Henriquez shares beneficial
ownership with his spouse.
/(7)/ Includes 1,948 shares as to which Mr. Lawson shares beneficial
ownership with his spouse.
/(8)/ Includes 70,000 exercisable options.
DESCRIPTION OF CAPITAL STOCK
STOCK OF THE BANK
The Bank's Articles of Incorporation authorize the issuance of up to
1,765,616 shares of common stock, $1.25 par value per share. As of the date of
this Proxy Statement/Prospectus, there are 1,426,288 shares of common stock of
the Bank issued and outstanding, all of which shares are fully paid and non-
assessable.
Dividends on the Bank's shares may be paid to shareholders at such time and
in such amounts as may be declared by the Board of Directors out of funds
legally available for the payment of dividends, subject to certain restrictions
by regulatory authorities.
Each of these shares is entitled to one vote in all matters presented to
shareholders and to share ratably in the assets of the Bank in the event of
liquidation. These shares are not convertible into any other security, nor are
they subject to any call, assessment or redemption. The holders of these shares
do not have preemptive rights to subscribe for additional shares of common
stock.
STOCK OF THE COMPANY
The Holding Company's Articles of Incorporation authorize the issuance of
5,000,000 shares of common stock, $0.10 par value per share. The Holding Company
is a newly-formed Florida corporation and has no history of earnings and has
never paid any dividends.
Assuming that no shareholder of the Bank exercises his dissenter's rights,
there will be 1,426,288 shares of common stock of the Holding Company issued and
outstanding upon consummation of the reorganization.
The Board of Directors of the Holding Company will be empowered to pay such
dividends at such time as they may deem appropriate out of funds legally
available for the payment of dividends. Shareholders should, however, be aware
that the only current source of funds with which the Holding Company could pay
dividends would be from amounts received as dividends from the Bank.
Each share of common stock of the Holding Company is entitled to one vote
in all matters that may be presented to the shareholders and to share ratably in
the assets of the Holding Company in the event of liquidation. These shares are
not convertible into any other security, nor are they subject to any call,
assessment or redemption. The holders of these shares do not have preemptive
rights to subscribe to additional shares of common stock of
25
<PAGE>
EXHIBIT A
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Merger Agreement"), dated as of
February 27, 1996, as amended, is made by and between TIB BANK OF THE KEYS (the
"Bank"), and TIB INTERIM CORP. (the "Interim"), and is joined by TIB FINANCIAL
CORP. (the "Corporation").
The Bank and the Interim are each state banking corporations duly organized
under the laws of the State of Florida. The Bank shall merge with the Interim
under the charter and title of the Bank, which shall be the "Resulting Bank."
The three parties to this Merger Agreement maintain their main offices at 99451
Overseas Highway, in Key Largo, County of Monroe, State of Florida. The Bank
operates eight branch offices located in Monroe County, Florida at the addresses
as set forth in Attachment "A." The Interim has no branches. As of March 31,
1996 the Bank had 1,765,616 shares (as adjusted) of authorized common stock, par
value of $1.25 per share, of which 1,423,288 shares (as adjusted) were issued
and outstanding (total of $1,779,110) with surplus of $4,505,902 and undivided
profits, including capital reserves and after net unrealized losses on available
for sale securities, of $14,694,988, resulting in total capital funds of
$20,980,000. The Interim has authorized capital stock of one share of common
stock of a par value of $1.25 per share, which is subscribed for by the
Corporation at a price of $10.00 per share and will be paid for in full prior to
the effective date of the Merger (as defined herein) contemplated hereby, and a
surplus of $7.50 and undivided profits or capital reserves of $1.25.
The Corporation is a corporation duly organized under the laws of the State
of Florida, is authorized to do business in Florida, and has its principal
office in Key Largo, County of Monroe, State of Florida. As of the date hereof,
the Corporation has authorized common stock of 5,000,000 shares $0.10 par value.
There is one shares of common stock issued and outstanding at a price of $10.00
as of the date of this Merger Agreement.
A majority of the Board of Directors of the Bank and the Interim have,
respectively, entered into and signed this Merger Agreement, and the Board of
Directors of the Corporation has approved this Merger Agreement, undertaken that
the Corporation shall join in and be bound by it, and has authorized the
undertakings hereinafter made by the Corporation.
From and after the date the Merger becomes effective, and as and when
required by the provisions of this Merger Agreement, the Corporation will issue
its shares of common stock which the shareholders of the Bank shall be entitled
to receive as hereinafter provided.
In consideration of the premises and covenants contained herein, the Bank
and the Interim hereby make this Merger Agreement and prescribe the terms and
conditiomode of carrying such Merger into effect, as follows:
1. MERGER. The Bank shall merge with the Interim under the charter and
------
the title of the Bank (which shall be the "Resulting Bank"), pursuant to Section
658.41 of the Florida Banking Code (the "Merger"), in the manner and with the
effect provided therein. As a result of the Merger:
a. The total capital funds of the Resulting Bank shall be not less
than $20,980,000, divided by 1,423,288 shares of common stock, each of $1.25 par
value, and at the time the Merger shall become effective, the Resulting Bank
shall have a surplus of not less than $4,505,902, and undivided profits,
including capital reserves and after net losses for available for sale
securities of not less than $14,694,988, which, when combined with capital and
surplus, will be equal to not less than the March 31, 1996 capital structure of
the Bank (as adjusted), and the capital structure of the Interim at the
effective date of the Merger as noted above; adjusted, however, for normal
earnings and expenses of the Bank between March 31, 1996 and the time of the
consummation of the Merger, and the redemption and cancellation of the one share
of $1.25 par value stock used to capitalize the Interim, at an aggregate
redemption price of $10.00.
A-1
<PAGE>
b. The Resulting Bank shall have the rights, privileges, immunities
and franchises, public or private, of each of the merged banks, and all
property, real, personal, and mixed, and all debts due on whatever account,
including subscriptions to shares, and all other chooses in action. All
interests of or belonging to or due to each of the merged banks shall be deemed
to be transferred to and vested in the Resulting Bank without further act or
deed. The title to real estate, or interest therein, vested in the merged banks
shall not revert or be in any way impaired because of the Merger. The Resulting
Bank shall not have trust powers.
c. The Resulting Bank shall thereafter be responsible and liable for
all liabilities and obligations of each of the merged banks. A claim existing or
action or proceeding pending by or against either merged bank may be prosecuted
as if the Merger had not taken place, or the Resulting Bank may be substituted
in its place. The rights of creditors and any lien upon the property of such
merged banks shall not be impaired by the Merger.
d. The Articles of Incorporation of the Bank shall be the Articles
of Incorporation of the Resulting Bank, and the Bylaws of the Bank in existence
on the effective date of the Merger, shall be the Bylaws of the Resulting Bank
until repealed or amended, as provided by law. (See Addendum I for complete
Articles of Incorporation of the Bank).
e. The name of the Resulting Bank shall be "TIB BANK OF THE KEYS"
until changed, as provided by law.
f. The business of the Resulting Bank shall be that of a state
banking corporation. This business shall be conducted by the Resulting Bank at
its main office which shall be located at 99451 Overseas Highway, Key Largo,
Florida, and at its legally established branches located in Monroe County,
Florida as set forth in Attachment "A." The Directors of the Resulting Bank
shall be the Directors of the Bank immediately prior to the Merger. The
Directors of the Resulting Bank shall hold office until their successors are
elected and have qualified.
g. No benefit, stock option or employee stock ownership plans of the
Bank shall terminate by reason of the Merger, but shall continue as the plans of
the Resulting Bank; provided, however, that such plans may subsequently be
amended or terminated as provided by law and further provided that any shares of
stock issued pursuant to said plans subsequent to consummation of the Merger
shall be shares of the Corporation.
2. CONVERSION, EXCHANGE AND CONSOLIDATION OF SHARES.
------------------------------------------------
a. To the Corporation, in exchange for the issuance of its shares
under Section 2(c) hereof, there shall be issued 1,423,288 shares of the
Resulting Bank's common shares of $1.25 par value which shall represent all of
the issued and outstanding common stock of the Resulting Bank.
b. The amount and number of shares of capital stock, surplus and
undivided profits of the Bank outstanding immediately before the Merger becomes
effective (specifically, $20,980,000, divided by 1,423,288 shares of par value
of $1.25 each, surplus of $4,505,902 and undivided profits, including capital
reserves and net of unrealized losses on available for sale securities, of
$14,694,988), shall be increased by the amount, and the number of shares of
capital stock, surplus and undivided profits of the Interim outstanding
immediately before the Merger becomes effective (specifically, $10.00 divided
into one share of the par value of $1.25 each, surplus of $7.50, and undivided
profits or capital reserves of $1.25), with the effect that the amount and
number of shares of the capital stock, surplus and undivided profits of the
Resulting Bank outstanding upon completion of the Merger shall be equal to the
aggregate amount and the aggregate number of shares of capital stock, surplus
and undivided profits of the Bank and the Interim combined immediately before
the Merger; adjusted, however, for normal earnings, expenses, and stock
dividends of the Bank after March 31, 1996 and prior
A-2
<PAGE>
to the time the Merger becomes effective, and the immediate redemption and
cancellation of the stock used to capitalize the Interim, specifically one share
of $1.25 par value common stock, at an aggregate price of $10.00.
c. Each holder of common stock of the Bank will be entitled to
receive one (1) share of the Corporation stock for each share of the Bank stock
held by them on the effective date of the Merger. As soon as is practicable
after the effective date of the Merger, stock certificates representing common
stock of the Bank issued and outstanding prior to the effective date may be
surrendered to the Corporation in exchange for a certificate representing the
requisite number of shares of the Corporation to which each holder is entitled.
Until so exchanged after the effective date, each certificate nominally
representing common stock of the Bank prior to the effective date shall, for all
corporate purposes, be deemed to evidence ownership of the number of shares of
the Corporation which the holder would be entitled to receive upon its surrender
to the Corporation.
d. At the discretion of the Board of Directors of the Bank,
dividends may or may not be paid during the period beginning at the date of this
Merger Agreement and ending with the consummation of the Merger.
3. NECESSARY APPROVALS. This Merger Agreement shall be submitted to the
-------------------
shareholders of the Bank and the Interim for adoption at separate meetings to be
called and held in accordance with the applicable provisions of law and the
respective Articles of Incorporation and Bylaws of the Bank and the Interim. The
Bank and the Interim shall proceed expeditiously and cooperate fully in the
procurement of any other consents and approvals, in the taking of any other
action, and in the satisfaction of all other requirements prescribed by law or
otherwise necessary for consummation of the Merger on the terms provided;
including, without being limited to, the preparation and submission of an
application to the Florida Department of Banking and Finance for approval of the
Merger under the provisions of the laws of the State of Florida. The
consummation of the Merger shall be subject to the approval of the transaction
by the shareholders of the Bank and the Interim and the Florida Department of
Banking and Finance and the Federal Deposit Insurance Corporation.
4. RIGHTS OF DISSENTING SHAREHOLDERS. Any shareholder of the Bank who
---------------------------------
votes against the Merger at the meeting of shareholderS of the Bank held for the
purpose of considering this Merger Agreement or who gives notice in writing at
or prior to such meeting of shareholders of the Bank that he dissents from the
Merger, and who otherwise complies with the requirements of Section 658.44 of
the Florida statutes, shall be entitled to receive cash as provided in Section
658.44 of the Florida Statutes from the Resulting Bank, if and when the Merger
is consummated. (A copy of the relevant portions of Section 658.44 of the
Florida Statutes is attached hereto as "Addendum II.")
5. CONDITIONS PRECEDENT. Consummation of the Merger contemplated by this
--------------------
Merger Agreement is conditioned upon the satisfaction of the following
conditions:
a. adoption of this Merger Agreement by the affirmative vote of the
shareholders, both of the Bank and the Interim, owning at least a majority of
the outstanding capital stock of each, and who are entitled to vote thereon at
the meetings of such shareholders to be held for such purpose;
b. the Florida Department of Banking and Finance and the Federal
Deposit Insurance Corporation shall have approved the merger of the Interim into
the Bank;
c. the Board of Governors of the Federal Reserve System shall have
approved the application of the Corporation to become a bank holding company by
reason of its acquisition of all of the outstanding Bank stock;
d. the expiration of the review period of the United States
Department of Justice; and
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<PAGE>
e. at the time of the mailing of the Bank's proxy statement to its
shareholders and thereafter through the Closing, the Corporation stock to be
received by the Bank shareholders shall be the subject of an effective
registration statement under the Securities Act of 1933 and shall be duly
registered or qualified under the securities laws of all states in which such
registration or qualification is required, or the Corporation stock shall be
exempt from the registration requirements of such federal or state laws; (f)
Corporation and the Bank shall have received at the Closing an opinion from
Holland & Knight in form and substance satisfactory to the Corporation and the
Bank to the effect, in general, that:
(i) The Reorganization will qualify as a reorganization under
Section 368(a)(1)(A) of the Internal Revenue Code by
reason of Section 368(a)(2)(E) thereof;
(ii) No gain or loss will be recognized by the holders of the
Bank stock on the conversion of such shares into the
Corporation stock;
(iii) The cost basis of the Corporation stock received in the
Reorganization by holders of the Bank stock will generally
be the same as their cost basis in the Bank stock
exchanged therefor;
(iv) The holding period of the Corporation stock received will
include the period during which the Bank stock exchanged
therefor was held, provided the Bank stock was held as a
capital asset;
(v) No gain or loss will be recognized by the Bank, the
Corporation or the Interim as a result of the
Reorganization; and
(vi) Cash received by the Bank shareholders exercising their
dissenters' rights and receiving cash in exchange for
their Bank stock pursuant to a dissenter's proceeding,
will be treated as having been received as a taxable
redemption of their Bank stock, subject to the provisions
of Section 302 of the Internal Revenue Code.
6. TERMINATION OF MERGER. This Merger Agreement may be terminated and
---------------------
abandoned by the Bank at any time prior to the date the Merger becomes
effective, whether before or after any shareholder action in the event of the
occurrence of any one or more of the following circumstances which in the sole
judgment of the Bank's Board of Directors, makes the Merger undesirable for the
Bank and its shareholders:
a. The holders of more than 10% of the outstanding shares of Bank
stock dissent from the Merger;
b. Any act, suit, proceeding or claim relating to the Merger is
instituted before any court or administrative body or threatened to be
instituted before such court or body; or
c. For any other reason the consummation of the Merger is deemed
inadvisable in the opinion of the Bank's Board of Directors.
Upon termination, as provided in this section, this Merger Agreement shall be
void and of no further effect, and there shall be no liability by reason of this
Merger Agreement or the termination thereof on the part of the Bank, the Interim
or the Corporation, or on the directors, officers, employees, agents or
shareholders of any them.
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<PAGE>
7. DIRECTORS. The name and address of each director who is to serve as a
---------
director of the Resulting Bank, until the next meeting of shareholders at which
directors are elected, is as follows:
<TABLE>
<S> <C>
B.G. Carter William Eldon Chasteen
Long Ben Lane 127 Harbor View Drive
Cudjoe Key, Florida 33042 Tavernier, Florida 33070
Armando J. Henriquez James R. Lawson, III
3615 Sunrise Drive 122 East Shore Drive
Key West, Florida 33040 Key Largo, Florida 33037
Edward V. Lett Scott A. Marr
87465 Old Highway, #225 496 Caribbean Drive
Islamorada, Florida 33036 Key Largo, Florida 33037
Derek D. Martin-Vegue W. Kenneth Meeks
2020 Manor Lane Pen Key Club
Marathon, Florida 33050 Islamorada, Florida 33036
Joseph H. Roth, Jr. Richard J. Williams
88181 State Road, #E-33 Williams Drive
Islamorada, Florida 33036 Islamorada, Florida 33036
</TABLE>
8. EXECUTIVE OFFICERS. Upon the Merger becoming effective, the executive
------------------
officers of the Resulting Bank shall be as follows:
W. KENNETH MEEKS - Chairman of the Board
EDWARD V. LETT - President and Chief Executive Officer
DANIEL W. TAYLOR - Executive Vice President
9. EFFECTIVE DATE. Subject to the terms and upon satisfaction of all
--------------
requirements of law and the conditions specified in this Merger Agreement, the
Merger shall become effective at the time specified in the certificate of the
Florida Department of Banking and Finance approving the Merger.
[SIGNATURES OMITTED]
A-5
<PAGE>
ATTACHMENT A
TIB BANK OF THE KEYS
BRANCH LOCATIONS
1. Key Largo Bayside, 10330 Overseas Highway, Key Largo, Florida 33037
2. Tavernier, 91980 Overseas Highway, Tavernier, Florida 33037
3. Islamorada, 80900 Overseas Highway, Tavernier, Florida 33037
4. Marathon Shores, 11401 Overseas Highway, Marathon Shores, Florida 33052
5. Marathon, 2315 Overseas Highway, Marathon, Florida 33050
6. Big Pine Key, Mile Marker 30.4, Big Pine Key, Florida 33043
7. Key West, 330 Whitehead Street, Key West, Florida 33041
8. Searstown Key West, 3322 N. Roosevelt Blvd., Key West, Florida 33040
B-1
<PAGE>
ATTACHMENT B
RIGHTS OF DISSENTING SHAREHOLDERS
658.44 APPROVAL BY STOCKHOLDERS; RIGHTS OF DISSENTERS; PREEMPTIVE RIGHTS.--
(1) The department shall not issue a certificate of merger to a resulting
state bank or trust company unless the plan of merger and merger agreement, as
adopted by a majority of the entire board of directors of each constituent bank
or trust company, and as approved by each appropriate federal regulatory agency
and by the department, has been approved:
(a) By the stockholders of each constituent national bank as provided
by, and in accordance with the procedures required by, the laws of
the United States applicable thereto, and
(b) After notice as hereinafter provided, by the affirmative vote or
written consent of the holders of at least a majority of the shares
entitled to vote thereon of each constituent state bank or state
trust company, unless any class of shares of any constituent state
bank or state trust company is entitled to vote thereon as a class,
in which event as to such constituent state bank or state trust
company the plan of merger and merger agreement shall be approved by
the stockholders upon receiving the affirmative vote or written
consent of the holders of a majority of the shares of each class of
shares entitled to vote thereon as a class and of the total shares
entitled to vote thereon. Such vote of stockholders of a constituent
state bank or state trust company shall be at an annual or special
meeting of stockholders or by written consent of the stockholders
without a meeting as provided in s. 607.0704.
Approval by the stockholders of a constituent bank or trust company of a plan of
merger and merger agreement shall constitute the adoption by the stockholders of
the articles of incorporation of the resulting state bank or state trust company
as set forth in the plan of merger and merger agreement.
(2) Written notice of the meeting of, or proposed written consent action
by, the stockholders of each constituent state bank or state trust company shall
be given to each stockholder of record, whether or not entitled to vote, and
whether the meeting is an annual or a special meeting or whether the vote is to
be by written consent pursuant to s. 607.0704, and the notice shall state that
the purpose or one of the purposes of the meeting, or of the proposed action by
the stockholders without a meeting, is to consider the proposed plan of merger
and merger agreement. Except to the extent provided otherwise with respect to
stockholders of a resulting bank or trust company pursuant to subsection (7),
the notice shall also state that dissenting stockholders will be entitled to
payment in cash of the value of only those shares held by the stockholders:
(a) Which at a meeting of the stockholders are voted against the
approval of the plan of merger and merger agreement;
(b) As to which, if the proposed action is to be by written consent of
stockholders pursuant to s. 607.0704, such written consent is not
given by the holder thereof; or
(c) With respect to which the holder thereof has given written notice to
the constituent state bank or trust company, at or prior to the
meeting of the stockholders or on or prior to the date specified for
action by the stockholders without a meeting pursuant to s. 607.0704
in the notice of such proposed action, that the stockholder dissents
from the plan of merger and merger agreement.
Hereinafter in this section, the term "dissenting shares" means and includes
only those shares, which may be all or less than all the shares of any class
owned by a stockholder, described in paragraphs (a), (b), and (c).
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<PAGE>
(3) On or promptly after the effective date of the merger, the resulting
state bank or trust company, or a bank holding company which, as set out in the
plan of merger or merger agreement, is offering shares rights, obligations, or
other securities or property in exchange for shares of the constituent banks or
trust companies, may fix an amount which it considers to be not more than the
fair market value of the shares of a constituent bank or trust company and which
it will pay to the holders of dissenting shares of that constituent bank or
trust company and, if it fixes such amount, shall offer to pay such amount to
the holders of all dissenting shares of that constituent bank or trust company.
The amount payable pursuant to any such offer which is accepted by the holders
of dissenting shares, and the amount payable to the holders of dissenting shares
pursuant to an appraisal, shall constitute a debt of the resulting state bank or
state trust company.
(4) The owners of dissenting shares who have accepted an offer made
pursuant to subsection (3) shall be entitled to receive the amount so offered
for such shares in cash upon surrendering the stock certificates representing
such shares at any time within 30 days after the effective date of the merger,
and the owners of dissenting shares, the value of which is to be determined by
appraisal, shall be entitled to receive the value of such shares in cash upon
surrender of the stock certificates representing such shares at any time within
30 days after the value of such shares has been determined by appraisal made on
or after the effective date of the merger.
(5) The value of dissenting shares of each constituent state bank or state
trust company, the owners of which have not accepted an offer for such shares
made pursuant to subsection (3), shall be determined as of the effective date of
the merger by three appraisers, one to be selected by the owners of at least
two-thirds of such dissenting shares, one to be selected by the board of
directors of the resulting state bank, and the third to be selected by the two
so chosen. The value agreed upon by any two of the appraisers shall control and
be final and binding on all parties. If, within 90 days from the effective date
of the merger, for any reason one or more of the appraisers is not selected as
herein provided, or the appraisers fail to determine the value of such
dissenting shares, the department shall cause an appraisal of such dissenting
shares to be made which will be final and binding on all parties. The expenses
of appraisal shall be paid by the resulting state bank or trust company.
(6) Upon the effective date of the merger, all the shares of stock of every
class of each constituent bank or trust company, whether or not surrendered by
the holders thereof, shall be void and deemed to be canceled, and no voting or
other rights of any kind shall pertain thereto or to the holders thereof except
only such rights as may be expressly provided in the plan of merger and merger
agreement or expressly provided by law.
(7) The provisions of subsection (6) and, unless agreed by all the
constituent banks and trust companies and expressly provided in the plan of
merger and merger agreement, subsections (3), (4), and (5) are not applicable to
a resulting bank or trust company or to the shares or holders of shares of a
resulting bank or trust company the cash, shares, rights, obligations, or other
securities or property of which, in whole or in part, is provided in the plan of
merger or merger agreement to be exchanged for the shares of the other
constituent banks or trust companies.
(8) The stock, rights, obligations, and other securities of a resulting
bank or trust company may be issued as provided by the terms of the plan of
merger and merger agreement, free from any preemptive rights of the holders of
any of the shares of stock or of any of the rights, obligations, or other
securities of such resulting bank or trust company or of any of the constituent
banks or trust companieerger and merger agreement by the stockholders as
provided in subsection (1), there shall be filed with the department, within 30
days after the time limit in s. 658.43(5), a fully executed counterpart of the
plan of merger and merger agreement as so approved if it differs in any respect
from any fully executed counterpart thereof theretofore filed with the
department, and copies of the resolutions approving the same by the stockholders
of each constituent bank or trust company, certified by the president, or chief
executive officer if other than the president, and the cashier or corporate
secretary of each constituent bank or trust company, respectively, with the
corporate seal impressed thereon.
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