<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
X Quarterly report under Section 13 or 15(d) of the Securities Exchange
- --- Act of 1934 For the quarterly period ended March 31, 1999
--------------
Transition report under Section 13 or 15(d) of the Exchange Act
- --- For the transition period from to
--------------- ----------------
Commission File No. 333-41545
ebank.com, Inc.
- --------------------------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in its Charter)
Georgia 58-2349097
------- ----------
(State of Incorporation) (I.R.S. Employer Identification No.)
2410 Paces Ferry Road, Atlanta, Georgia 30339
---------------------------------------------
(Address of Principal Executive Offices)
(770) 863-9229
--------------
(Issuer's Telephone Number, Including Area Code)
Not Applicable
--------------
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last
Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes X No
-- ---
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date:
1,469,250 shares of common stock, par value $.01 per share, were issued
and outstanding as of May 6, 1999.
Transitional Small Business Disclosure Format (check one): Yes No X
-- --
<PAGE> 2
EBANK.COM, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1999 1998
(UNAUDITED) (AUDITED)
------------ ------------
<S> <C> <C>
Cash and due from banks $ 442,644 $ 603,677
Federal funds sold 4,480,000 9,320,000
Investment securities available for sale 3,967,550 3,986,491
Other securities 63,000 25,500
Loans, net of allowance for loan losses of $235,000, and $165,000, 18,859,361 10,240,557
respectively
Premises and equipment, net 920,176 865,587
Accrued interest receivable 79,978 49,740
Investment in joint venture 80,998 162,091
Other assets 290,467 246,193
------------ ------------
Total assets $ 29,184,174 $ 25,499,836
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits $ 16,774,770 $ 12,801,123
Accrued interest payable 43,696 26,552
Other liabilities 43,765 51,413
------------ ------------
Total liabilities $ 16,862,231 $ 12,879,088
------------ ------------
SHAREHOLDERS' EQUITY
Common stock, $.01 par value, 10,000,000 shares
authorized, 1,469,250 shares issued and outstanding $ 14,693 $ 14,693
Surplus 13,722,072 13,722,072
Accumulated deficit (1,414,204) (1,115,778)
Accumulated other comprehensive income (loss) (618) (239)
------------ ------------
Total shareholders' equity 12,321,943 12,620,748
------------ ------------
Total liabilities and shareholders' equity $ 29,184,174 $ 25,499,836
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE> 3
EBANK.COM, INC.
CONSOLIDATED STATEMENT OF LOSS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
MARCH 31, 1999 MARCH 31, 1998
-------------- ---------------------
(Parent Company Only)
<S> <C> <C>
Interest income
Loans, including fees $ 351,116 $ --
Investment securities: --
U.S. Government agencies and corporations 46,685 --
Other investments 487 --
Federal funds sold 91,300 --
--------- --------
Total interest income 489,588 0
--------- --------
Interest expense
Interest bearing demand and money market 60,816 --
Savings 108 --
Time deposits of $100,000 or more 50,521 --
Other time deposits 62,145 --
--------- --------
Total interest expense 173,590 0
--------- --------
Net interest income 315,998 0
--------
Provision for possible loan losses 70,000 --
--------- --------
Net interest income after provision
for possible loan losses 245,998 0
-------- --------
Other income 1,725 --
Loss on joint venture (81,093) --
--------- --------
Total other income (79,368) 0
--------- --------
Other expense
Salaries and other compensation 227,622 29,375
Employee benefits 45,174 --
Net occupancy and equipment expense 96,188 4,494
Professional and other outside services 56,864 --
Other expense 39,208 5,189
--------- --------
Total other expenses 465,056 39,058
--------- --------
Loss before income tax benefit (298,426) (39,058)
Income tax benefit -- --
-------- --------
Net loss $(298,426) $(39,058)
========= ========
Basic and diluted loss per common share $ (0.20) N/A
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 4
EBANK.COM, INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED
March 31,
--------------------------------------
1999 1998
--------------- --------------------
(parent company only)
<S> <C> <C>
Net loss $ (298,426) $ (39,058)
Other comprehensive loss, net of tax:
Unrealized loss on securities available for sale (379) 0
-------------- --------------------
Comprehensive loss $ (298,805) $ (39,058)
============== ====================
</TABLE>
<PAGE> 5
EBANK.COM, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
For the Three Months ended
March 31,
---------------------------
CASH FLOWS FROM OPERATING ACTIVITIES 1999 1998
----------- ---------
<S> <C> <C>
Net loss $ (298,426) $ (39,058)
Adjustment to reconcile net loss to net cash used by operating
activities:
Net (accretion) amortization of investment securities (46,548) --
Depreciation and amortization of premises and equipment 34,626 --
Provision for possible loan losses 70,000 --
Loss on joint venture 81,093 --
Increase in other assets (44,275) (5,848)
Increase in accrued interest receivable (30,238) --
Increase in accrued interest payable 17,145 --
Decrease in other liabilities (7,649) (9,986)
----------- ---------
Net cash used by operating activities (224,272) (54,892)
----------- ---------
Cash flows from investing activities:
Purchase of investment securities available for sale and other investments (4,972,390) --
Maturities of investment securities available for sale 5,000,000 --
Loans originated, net of principal repayments (8,688,802) --
Purchases of premises and equipment (89,216) --
----------- ---------
Net cash used by investing activities (8,750,408) 0
----------- ---------
Cash flows from financing activities:
Net increase in deposits 3,973,647 --
Proceeds from other borrowings -- 102,000
----------- ---------
Net cash provided from financing activities 3,973,647 102,000
----------- ---------
Net increase (decrease) in cash and cash equivalents (5,001,033) 47,108
Cash and Cash Equivalents:
Beginning of period 9,923,677 (41,423)
----------- ---------
End of period $ 4,922,644 $ 5,685
=========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE> 6
EBANK.COM, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Item 310 (b)
of Regulation S-B. Accordingly, they do not include all the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three-month period ended March 31, 1999
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1999. For further information, refer to the Company's
consolidated financial statements and footnotes included in the Company's annual
report on Form 10-KSB.
Under the name Southeast Commerce Holding Company, the Company was
incorporated under the laws of the State of Georgia on August 22, 1997, for the
purpose of becoming a bank holding company for a federal savings bank, Commerce
Bank (the "Bank"). On April 21, 1998, the Company commenced an initial public
offering of its common stock at $10.00 per share. Total proceeds at the close of
the offering in July 1998 totaled $13,736,665, net of selling expenses. The
Company injected $8.50 million into the Bank's capital accounts upon opening on
August 17, 1998. In the second quarter of 1999, the Company changed its name to
ebank.com, Inc.
Basis of Presentation and Reclassification. The consolidated financial
statements include the accounts of the Company and the Bank. All significant
intercompany accounts and transactions have been eliminated in consolidation.
NOTE 2 - SHARES USED IN COMPUTING NET LOSS PER SHARE
Basic and diluted loss per share are based on 1,469,250 weighted average shares
outstanding for the quarter ended March 31, 1999. There were 135,050 potential
weighted common shares outstanding at March 31, 1999, related to common stock
options. These shares were not included in the computation of the diluted loss
per share amount because the Company was in a net loss position and, thus, any
potential common shares were anti-dilutive.
NOTE 3 - NEW ACCOUNTING PRONOUNCEMENTS
REPORTING COMPREHENSIVE INCOME
Effective January 1, 1998, the Company adopted Statement of Financial Accounting
Standards No. 130 (SFAS 130), "Reporting Comprehensive Income." Under SFAS 130,
a company is required to show changes in assets and liabilities in a new
comprehensive income statement or alternative presentation, as opposed to
showing some of the items as transactions in shareholders' equity accounts.
Since SFAS 130 solely relates to display and disclosure requirements, it had no
effect on the Company's financial results.
<PAGE> 7
SEGMENT REPORTING
Effective December 31, 1998, the Company adopted Statement of Financial
Accounting Standards No. 131 (SFAS 131), "Disclosures about Segments of an
Enterprise and Related Information." SFAS 131 establishes standards for the
disclosure of segment information about services, geographic areas, and major
customers. The Company acts as an independent community financial services
provider and offers traditional banking services to individual, commercial, and
government customers. Because management of the Company views and operates the
Bank as one versus multiple segments, no segmentation of bank operations between
services, types of customers, and market areas is provided.
ACCOUNTING PRONOUNCEMENTS AFFECTING FUTURE PERIODS
The Financial Accounting Standards Board has issued Statement of Financial
Accounting Standards No. 133 (SFAS 133) "Accounting for Derivative Instruments
and Hedging Activities." SFAS 133 is effective for fiscal years beginning after
June 15, 1999. Under SFAS 133, a company will recognize all free-standing
derivative instruments in the statement of financial position as either assets
or liabilities and will measure them at fair value. The difference between a
derivative's previous carrying amount and its fair value shall be reported as a
transition adjustment presented in net income or other comprehensive income, as
appropriate, in a manner similar to the cumulative effect of a change in
accounting principle. This statement also determines the accounting for the
changes in fair value of a derivative, depending on the intended use of the
derivative and resulting designation. The adoption of SFAS 133 is not expected
to have a significant impact on the consolidated financial condition or results
of operations of the Company.
In October 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 134 (SFAS 134), "Accounting for
Mortgage-Backed Securities Retained after the Securitization of Mortgage Loans
Held for Sale by a Mortgage Banking Enterprise." SFAS 134 is effective for the
first fiscal quarter after December 15, 1998, and amends Statement of Financial
Accounting Standards No. 65, "Accounting for Certain Mortgage Banking
Activities," which revises the accounting for retained securities and beneficial
interests. The adoption of SFAS 134 is not expected to have a significant impact
on the consolidated financial condition or results of operations of the Company.
NOTE 4 - ACCUMULATED OTHER COMPREHENSIVE LOSS
Accumulated other comprehensive loss is as follows:
<TABLE>
<CAPTION>
Unrealized
Gains (Losses)
On Securities
--------------
<S> <C>
Beginning balance - January 1, 1999 $ (239)
Current - period change, net of tax
of $(252) (379)
----------
Ending balance - March 31, 1999 $ (618)
----------
</TABLE>
<PAGE> 8
PART I - FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The following discussion contains forward-looking statements that
involve risks and uncertainties. The Company's actual results may differ
materially from the results discussed in the forward-looking statements, and the
Company's operating performance each quarter is subject to various risks and
uncertainties that are discussed in detail in the Company's filings with the
Securities and Exchange Commission, including the "Risk Factors" section in the
Company's Registration Statement on Form SB-2 (Registration Number 333-41545) as
filed with and declared effective by the Securities and Exchange Commission.
The Company was organized on August 22, 1997. The Company's initial
activities related to its organization, the conducting of its initial public
offering, the pursuit of approvals from the Office of Thrift Supervision (the
"OTS") for its application to charter its subsidiary bank, Commerce Bank, and
the pursuit of approvals from the Federal Deposit Insurance Corporation (the
"FDIC") for its application for insurance of the deposits of the Bank. On May
21, 1998, the Company received preliminary approval from the OTS to charter the
Bank, and the Bank opened for business on August 17, 1998. Because the Bank was
not in operations during the first quarter of 1998, comparative information for
the first quarter of 1998 would not be meaningful and has been omitted from this
discussion. A review of the Company's operating results should be made with an
understanding of its short history.
Financial Condition
Total consolidated assets increased by $3,684,338 to $29,184,174 during
the three-month period ended March 31, 1999. The increase was generated
primarily through an net increase in deposits of $3,973,647.
At March 31, 1999, the Company had total assets of $29,184,174,
consisting of federal funds sold of $4,480,000, investments of $4,030,550, net
loans of $18,859,361, property, at cost less accumulated depreciation of
$920,176, cash and cash equivalents of $442,644, and other assets totaling
$451,443. The Company's liabilities at March 31, 1999, were $16,862,231,
consisting of deposits of $16,774,770, and accrued expenses and other
liabilities of $87,461. The Company's shareholders' equity of totaled
$12,321,943 at March 31, 1999.
Results of Operations
From the Bank's opening date on August 17, 1998 through March 31, 1999,
the Bank attracted $16.8 million in deposits, and made net loans of $18.9
million. Net interest income for the three-month period ending March 31, 1999
totalled $245,998, after a provision for loan losses of $70,000. Operating
expenses of the Company totalled $465,056, including salaries and other
compensation of $227,622, employee benefits expenses of $45,174, occupancy and
equipment expenses of $96,188, professional and other outside services of
$56,864, and other expenses of $39,208. The Company had a net loss of $298,426
for the three months ended March 31, 1999.
A major key to long-term earnings growth is the maintenance of a
high-quality loan portfolio. The Bank's directive in this regard is carried out
through its policies and procedures for extending credit to the Bank's
customers. The goal and result of these policies and procedures is to provide a
<PAGE> 9
sound basis for new credit extensions and an early recognition of problem assets
to allow the most flexibility in their timely disposition.
Because principal banking operations commenced on August 17, 1998,
management is not yet in a position to determine the composition of
non-performing assets. Additions to the allowance for loan losses will be made
periodically to maintain the allowance at an appropriate level based upon
management's analysis of potential risk in the loan portfolio. The amount of the
loan loss provision is determined by an evaluation of the level of loans
outstanding, the level of non-performing loans, historical loan loss experience,
delinquency trends, the amount of actual loan losses charged to the reserve in a
given period, and assessment of present and anticipated economic conditions.
At December 31, 1998, the allowance for loan losses amounted to
$165,000. By March 31, 1999, the allowance had grown to $235,000. The allowance
for loan losses, as a percentage of total gross loans, decreased from 1.59% to
1.23% during the three-month period ended March 31,1999. Management considers
the allowance for loan losses to be adequate and sufficient to absorb possible
future losses; however, there can be no assurance that charge-offs in future
periods will not exceed the allowance for loan losses or that additional
provisions to the allowance will not be required. The Company had no
non-performing loans at March 31, 1999 and had no charge-offs for the 3-month
ending March 31, 1999.
Net Interest Income
Net interest income represents the difference between interest received
on interest earning assets and interest paid on interest bearing liabilities.
The following represents, in a tabular form, the main components of interest
earning assets and interest bearing liabilities.
<TABLE>
<CAPTION>
Interest Interest
Earning Assets/Interest Average Income/ Yield/
Bearing Liabilities Balance Cost Cost
------------------- ----------- -------- ------
<S> <C> <C> <C>
Federal funds sold 7,825,556 91,300 4.73%
Securities 4,005,755 47,172 4.78%
Loans 14,796,532 351,116 9.62%
----------- -------- ----
Total 26,627,843 489,588 7.46%
===========
Deposits 16,901,231 173,590 4.17%
=========== --------
Net interest income 315,998
========
Net yield on earning assets 4.81%
====
</TABLE>
Other Income
Other income for the three-month period ended March 31, 1999 amounted
to $1,725. On an annualized basis, this represents less than .01% of total
assets. This figure is relatively low because in order to attract new banking
relationships, the Bank's fee structure and charges are low when compared to
other banks. The above fees and charges may increase in the future.
<PAGE> 10
The Company owns a 50% share in Commerce Mortgage Company, LLC.
Commerce Mortgage recognized a loss of $81,093 for the three-month period ended
March 31, 1999. Because the Company contributed 100% of the initial capital for
Commerce Mortgage, the Company recognized 100% of the net loss, or $81,093, for
the 3-month period ended March 31, 1999.
Other Expense
Operating expenses for the three-month period ended March 31, 1999
amounted to $465,056. On an annualized basis, this represents 6.4% of total
assets.
Liquidity and Sources of Capital
Liquidity is the Company's ability to meet all deposit withdrawals
immediately, while also providing for the credit needs of customers. The March
31, 1999 financial statements evidence a satisfactory liquidity position as
total cash, cash equivalents, and federal funds sold amounted to approximately
$4.9 million, representing 17% of total assets. Investment securities amounted
to $4.0 million, representing 14% of total assets. These securities provide a
secondary source of liquidity since they can be converted into cash in a timely
manner. Note that the Company's ability to maintain and expand its deposit base
and borrowing capabilities are a source of liquidity. For the three-month period
ended March 31, 1999, total deposits increased from $12.8 million to $16.8
million, representing an increase of 31%. The Company's management closely
monitors and maintains appropriate levels of interest earning assets and
interest bearing liabilities so that maturities of assets are such that adequate
funds are provided to meet customer withdrawals and loan demand.
Management is committed to maintaining capital at a level sufficient to
protect depositors and fully comply with all regulatory requirements. The Bank
maintains an adequate level of capitalization as measured by the following
capital ratios and the respective minimum capital requirements by the OTS, the
Bank's primary regulator.
<TABLE>
<CAPTION>
Bank Minimum
Capital Regulatory
Capital Ratios at March 31, 1999 Ratio Requirement
----------------------------------------- ------------ ---------------
<S> <C> <C>
Tier 1 capital 36.7% 4.0%
Tier 2 capital 1.1% --
------------ ---------------
Total risk-based capital ratio 37.8% 8.0%
============ ===============
Leverage ratio 27.6% 4.0%
============ ===============
</TABLE>
Note that with respect to the leverage ratio, the OTS has established a
3.0% minimum leverage ratio requirement. Note that the leverage ratio is
computed by dividing Tier 1 capital into average assets. For all except the
highest rated banks, the minimum leverage ratio should be 3.0% plus an
additional cushion of at least 1 to 2 percent, depending upon risk profiles and
other factors.
Loan Portfolio
Since loans typically provide higher interest yields than do other
types of earning assets, the Company's intent is to channel a substantial
percentage of its earning assets into the loans category. However, since the
Bank only commenced operations in August 1998, that category has not yet grown
to a percentage of total earning assets comparable to other banks that are well
established. Average
<PAGE> 11
loans, on an annualized basis, were $14,796,532 for the 3-month period ended
March 31, 1999. Total gross loans outstanding at March 31, 1999 were
$19,094,361.
The following table summarizes the composition of the loan portfolio at
March 31, 1999:
<TABLE>
<CAPTION>
Percent
Amount of total
-------------- ---------
<S> <C> <C>
Commercial $ 7,489,312 39.18%
Real estate - individual 7,358,511 38.49%
Real estate - commercial 3,272,135 17.12%
Installment loans to individuals 996,686 5.21%
-------------- ---------
Total loans 19,116,644 100.00%
=========
Less: Net deferred loan fees (22,283)
Allowance for loan loss (235,000)
--------------
Total net loans $ 18,859,361
==============
</TABLE>
The principal components of the Company's loan portfolio at March 31, 1999 were
mortgage loans and commercial loans, which represented 94.79% of the portfolio.
Due to the short time the portfolio has existed, the current mix of loans may
not be indicative of the ongoing portfolio mix. Management will attempt to
maintain a relatively diversified loan portfolio to help reduce the risk
inherent in concentration of collateral.
Other Matters
The Company is not aware of any current recommendation by the regulatory
authorities which, if implemented, would have a material effect on the Company's
liquidity, capital resources, or results of operations.
Year 2000 Readiness
Like many financial institutions, we rely on computers to conduct our
business and information systems processing. Industry experts are concerned that
on January 1, 2000, some computers may not be able to interpret the new year
properly, causing computer malfunctions. As described in more detail below, we
have developed and are executing a plan to ensure that our computer and
telecommunication systems do not have these Year 2000 problems. We do not
anticipate that the Year 2000 issue will materially impact our business or
operations. We rely on third party vendors to supply our computer and
telecommunication systems and other office equipment; and we also rely on a
third party to process our data and account information. Because we just
recently commenced operations, we had the ability to choose only those vendors
which we believed are ready for the Year 2000, thereby relieving any additional
costs associated with the conversion of older computer systems. Although we
believe we have addressed the Year 2000 issue, we cannot be entirely sure that
the Year 2000 will not have any adverse effect on the Company.
We have prepared a comprehensive Year 2000 plan to monitor and ensure
the Year 2000 compliance of our third party vendors of computer and
telecommunication systems, data processing services, and other office equipment.
We have budgeted for the execution of this plan, and the plan calls for us to
have all systems in place and be fully Year 2000 compliant by June 30, 1999. The
plan also calls for us to continue to monitor the situation through the end of
the year and beyond. We are
<PAGE> 12
executing this plan under the supervision of our chief financial officer and
vice president of operations, with oversight from our board of directors. Under
the plan, we will investigate the Year 2000 readiness of each vendor, review
Year 2000 testing completed by each vendor, test our own systems, if necessary
and reasonable, and require comprehensive Year 2000 warranties from each vendor.
Our investigation of each vendor will primarily consist of requesting and
reviewing its Year 2000 test results.
Phoenix International Ltd., Inc. (Phoenix) provides our mission
critical computer software and data processing services. Phoenix is a well
established company and provides computer systems and data processing services
to many financial institutions throughout the world. Phoenix is currently in the
process of testing its systems for Year 2000 issues and tested our database for
Year 2000 compliance in April 1999. We have reviewed the methods and results of
this testing and are satisfied that the tested systems are similar to ours and
that the Phoenix system will function as intended on all critical Year 2000
related dates. The Phoenix system includes interfaces to other systems provided
by other vendors, such as our ATM hardware. Phoenix is in the process of testing
these interfaces and will provide the results of these tests to us as soon as
they are complete. We expect to have all of these test results prior to June 30,
1999.
Our Year 2000 plan extends to our other less critical vendors as well,
including our vendors for ATM hardware, account origination software, telephone
systems, and suppliers of office equipment, such as copy and fax machines. Under
our plan, we are reviewing the test results, assurances and warranties of all of
these vendors, and will be satisfied that all systems provided are Year 2000
compliant before the end of June 1999. Based on our review of our vendor's
systems and Year 2000 testing results to date, we do not believe that any of
them will have any significant Year 2000 problems. The OTS and the FDIC are also
monitoring the Year 2000 readiness of the thrift industry.
<PAGE> 13
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
There are no material pending legal proceedings to which the Company or
any of its subsidiaries is a party or of which any of their property is the
subject.
ITEM 2. CHANGES IN SECURITIES.
(a) Not applicable.
(b) Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no matters submitted to security holders for a vote during
the three months ended March 31, 1999.
ITEM 5. OTHER INFORMATION.
As the Company has previously reported on a Form 8-K, the Company
announced on April 19, 1999 that it will launch its new Internet banking product
and service line by the end of the second quarter of 1999. Along with
traditional consumer banking services, the Company has developed a special line
of Internet banking services specifically tailored to meet the needs of small
business customers. The product offering will include, among other products, a
business sweep account and a special small business retirement account. The
Company plans to introduce a seamless financial services account for stocks,
mutual funds, and insurance products in the third quarter of 1999. The Company
stated that William W. Klenk, the Company's Director of Internet Banking
Services, will be responsible for the development and management of the
Company's Internet banking services and products.
The Company also announced that it has acquired the Internet domain
name, ebank.com, which is currently under construction and will be in service in
the second quarter of 1999. In line with this new initiative, the Company
changed its corporate name to ebank.com, Inc. effective April 20, 1999.
As the Company has previously reported on a Form 8-K, the Company
announced on May 3, 1999 that the trading symbol for its common stock has
changed from "STCH" to "EBDC" effective May 3, 1999. The new corporate trading
symbol reflects the change in the Company's name to ebank.com, Inc.
<PAGE> 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
<TABLE>
<S> <C>
(a) Exhibits.
3.1. Articles of Incorporation*
3.2. Bylaws*
4.1. See Exhibits 3.1 and 3.2 for provisions in the Company's Articles of Incorporation and Bylaws
defining the rights of holders of the Common Stock*
4.2. Form of Certificate of Common Stock*
10.1. Letter of Employment dated November 18, 1997, between the Company and Louis J. Douglass, III*
10.2. Line of Credit Agreement dated August 27, 1997, between The Company and The Bankers Bank*
10.3 Lease Agreement dated October 14, 1997, between the Company, as lessee, and Regent Paces Ferry
Office I, Inc., as lessor*
10.4 Form of Escrow Agreement among the Company, Banc Stock Financial Services, Inc., and The
Bankers Bank*
10.5 Phoenix International Ltd., Inc. Software License Agreement*
10.6 Letter of Intent dated February 20, 1998 between the Company and Banc Stock Financial Services,
Inc.*
10.7 Form of Underwriting Agreement among the Company and Banc Stock Financial Services, Inc.*
27.1. Financial Data Schedule (for electronic filing purposes)
99.1(a) Press Release dated August 17, 1998 to announce Commerce Mortgage Company, LLC (incorporated by
reference in the Company's Form 10QSB filed for the period ended June 30, 1998)
99.1(b) Press Release dated April 23, 1999 to announce the Company's name change to ebank.com, Inc.
(incorporated by reference in the Company's Form 8-K filed with the SEC on April 23, 1999)
99.2 Press Release dated May 3, 1999 to announce the Company's new stock trading symbol (incorporated
by reference in the Company's Form 8-K filed with the SEC on May 5, 1999)
</TABLE>
- ------------------------
* Incorporated by reference in the Company's Registration Statement on Form
SB-2, File No. 333-41545.
(b) Reports on Form 8-K.
There were no reports on Form 8-K filed by the Company during the
quarter ended March 31, 1999.
<PAGE> 15
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934 (the "Exchange Act"), the registrant caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
ebank.com, Inc.
Date: May 14, 1999 By: /s/ Richard A. Parlontieri
-------------- --------------------------------------
Richard A. Parlontieri
Chairman and Chief Executive Officer
By: /s/ Mark D. Little
--------------------------------------
Mark D. Little
Chief Financial Officer
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EXHIBIT INDEX
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<CAPTION>
EXHIBIT DESCRIPTION
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<S> <C>
3.1. Articles of Incorporation*
3.2. Bylaws*
4.1. See Exhibits 3.1 and 3.2 for provisions in the Company's Articles of Incorporation and Bylaws
defining the rights of holders of the Common Stock*
4.2. Form of Certificate of Common Stock*
10.1. Letter of Employment dated November 18, 1997, between the Company and Louis J. Douglass, III*
10.2. Line of Credit Agreement dated August 27, 1997, between The Company and The Bankers Bank*
10.3 Lease Agreement dated October 14, 1997, between the Company, as lessee, and Regent Paces Ferry
Office I, Inc., as lessor*
10.4 Form of Escrow Agreement among the Company, Banc Stock Financial Services, Inc., and The Bankers
Bank*
10.5 Phoenix International Ltd., Inc. Software License Agreement*
10.6 Letter of Intent dated February 20, 1998 between the Company and Banc Stock Financial Services,
Inc.*
10.7 Form of Underwriting Agreement among the Company and Banc Stock Financial Services, Inc.*
27.1. Financial Data Schedule (for electronic filing purposes)
99.1(a) Press Release dated August 17, 1998 to announce Commerce Mortgage Company, LLC (incorporated by
reference in the Company's Form 10QSB filed for the period ended June 30, 1998)
99.1(b) Press Release dated April 23, 1999 to announce the Company's name change to ebank.com, Inc.
(incorporated by reference in the Company's Form 8-K filed with the SEC on April 23, 1999)
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<PAGE> 17
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99.2 Press Release dated May 3, 1999 to announce the Company's new stock trading symbol (incorporated
by reference in the Company's Form 8-K filed with the SEC on May 5, 1999)
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* Incorporated by reference in the Company's Registration Statement on Form
SB-2, File No. 333-41545
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<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF EBANK.COM, INC. FOR THE THREE MONTHS ENDED MARCH 31,
1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 442,644
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 4,480,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 4,030,550
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 19,094,361
<ALLOWANCE> (235,000)
<TOTAL-ASSETS> 29,184,174
<DEPOSITS> 16,774,770
<SHORT-TERM> 0
<LIABILITIES-OTHER> 87,461
<LONG-TERM> 0
0
0
<COMMON> 13,736,765
<OTHER-SE> (1,414,822)
<TOTAL-LIABILITIES-AND-EQUITY> 20,184,174
<INTEREST-LOAN> 351,116
<INTEREST-INVEST> 138,472
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 489,588
<INTEREST-DEPOSIT> 173,590
<INTEREST-EXPENSE> 173,590
<INTEREST-INCOME-NET> 315,998
<LOAN-LOSSES> 70,000
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 544,424
<INCOME-PRETAX> (298,426)
<INCOME-PRE-EXTRAORDINARY> (298,426)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (298,426)
<EPS-PRIMARY> (0.20)
<EPS-DILUTED> (0.20)
<YIELD-ACTUAL> 7.46
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 165,000
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 165,000
<ALLOWANCE-DOMESTIC> 165,000
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
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