<PAGE> 1
As originally filed with the Securities and Exchange Commission
on September 30, 1998
Registration File No. 333-65101
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 3 TO
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
FLORIDA BUSINESS BANCGROUP, INC.
(Name of small business issuer in its charter)
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Florida 6711 59-3517595
- ------------------------------ ---------------------------- ------------------------------------
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(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification No.)
incorporation or organization) Classification Code Number)
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AUSTIN CENTER WEST, TOWER II, 1408 NORTH WESTSHORE BOULEVARD,
SUITE 502, TAMPA, FLORIDA 33607
- -------------------------------------------------------------------------------
(Address, including zip code, and telephone number, including area code,
of Registrant principal executive offices)
A. BRONSON THAYER
CHAIRMAN, CHIEF EXECUTIVE OFFICER
Austin Center West, Tower II, 1408 North Westshore Boulevard, Suite 502
Tampa, Florida 33607
(813) 281-0009
------------------------
Copies Requested to:
EDWARD W. DOUGHERTY, ESQUIRE
OR A. GEORGE IGLER, ESQUIRE
IGLER & DOUGHERTY, P.A.
1501 PARK AVENUE EAST
TALLAHASSEE, FLORIDA 32301
(850) 878-2411
(850) 878-1230 (FACSIMILE)
Approximate date of proposed sale to the public: As soon as practicable after
this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to rule 415 under the Securities Act of
1933 check the following box. [X]
If this Form is filed to register additional securities for an Offering pursuant
to rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering.
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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Title of
Each Class of Proposed Proposed
Securities to be Amount (1) Maximum Offering Maximum Aggregate Amount of Registration
Registered to be Registered Price Per Share Offering Price (2) Fee
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Common Stock $.01 par value.. 3,000,000 $10.00 $30,000,000 $8,850
Warrants..................... 1,500,000 $ 0.00 $ 0 $ 0
Units........................ 1,500,000 $ 0.00 $ 0 $ 0
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(1) Common Stock is to be issued along with a warrant to purchase one share of
Common Stock. Together each share and warrant is referred to as a unit.
(2) Estimated solely for the purpose of calculating the registration fee on the
basis of the proposed maximum offering price per unit.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.
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1,500,000 UNITS, EACH CONSISTING OF ONE SHARE OF COMMON STOCK AND ONE
WARRANT FOR THE PURCHASE OF ONE SHARE OF COMMON STOCK
Minimum: 700,000 Units -- Maximum: 1,500,000 Units
FLORIDA BUSINESS BANCGROUP, INC.
A Proposed Bank Holding Company
for
(LOGO) BAY CITIES BANK
TAMPA, FLORIDA
A Proposed State-Chartered Bank
FLORIDA BUSINESS BANCGROUP, INC., a Florida corporation ("Company"), hereby
offers for sale a minimum of 700,000 Units and a maximum of 1,500,000 Units at a
price of $10.00 per unit (the "Offering") for a 90-day period following the
effective date of the Registration Statement filed under the Securities Act of
1933. The Company in its sole discretion may extend the duration of the Offering
for a period not to exceed an additional 90 days. In no event may the Offering
be extended beyond August 7, 1999. Each Unit consists of one share of Common
Stock, par value $0.01, of the Company ("Common Stock") and one warrant
("Warrant") to purchase one additional share of Common Stock at $10.00 per
share. The minimum number of Units that may be purchased is 1,000. Warrants may
be exercised immediately after issuance and will expire 36 months from the
Effective Date unless redeemed sooner by the Company. See "TERMS OF THE OFFERING
- - Warrants." Warrants may be transferred by a holder, however, only in
conjunction with the simultaneous transfer of an equal number of shares. The
Organizers intend to purchase, in the aggregate, at least 305,000 Units or
43.57% of the total minimum Unit Offering. See "TERMS OF THE OFFERING -
Purchases by Organizers of the Company."
Actual sales of Units to the public are expected to be made beginning on or
about February 8, 1999 and end on or about August 7, 1999. The Units of the
Company are offered on a best-efforts basis by certain directors and executive
officers of the Company, who will receive no commissions for such sales. All
subscription funds tendered during the Offering Period will be deposited in an
interest-bearing escrow account with the Independent Banker's Bank of Florida
("Escrow Agent"). The Offering will be terminated and all subscription funds,
together with any interest earned thereon, will be promptly returned if all
required conditional regulatory approvals have not been obtained or the minimum
number of Units have not been subscribed to by the end of the offering period.
August 7, 1999 is the latest date on which the subscription funds might be held
in escrow prior to their return in the event the minimum is not reached or the
Company has not satisfied the conditional regulatory approvals. The Company may
accept or reject subscriptions obtained in the Offering accepted or rejected in
whole or in part by the Company for any reason. Once a subscription is accepted
by the Company, however, it cannot be withdrawn. See "TERMS OF THE OFFERING."
THE COMPANY RESERVES THE ABSOLUTE RIGHT TO CANCEL ALL SUBSCRIPTIONS AND
RETURN ALL SUBSCRIPTION FUNDS, TOGETHER WITH ANY INCOME REALIZED FROM THE
INVESTMENT OF SUCH FUNDS, FOR ANY REASON WHATSOEVER, AT ANY TIME PRIOR TO THE
TIME THAT THE COMPANY WITHDRAWS SUBSCRIPTION FUNDS FROM THE SUBSCRIPTION ESCROW
ACCOUNT. SEE "TERMS OF THE OFFERING."
ONCE SUBSCRIPTION FUNDS HAVE BEEN RELEASED BY THE ESCROW AGENT AND SHARES
OF THE COMPANY'S COMMON STOCK ARE ISSUED, IN THE EVENT THE OFFERING IS
TERMINATED BECAUSE OF THE COMPANY'S FAILURE TO SATISFY THE CONDITIONAL
REGULATORY APPROVALS, SUBSCRIBERS WILL NOT RECEIVE A FULL REFUND OF THEIR
SUBSCRIPTION PAYMENT. SEE "TERMS OF THE OFFERING - FAILURE OF BANK TO COMMENCE
OPERATIONS."
The Company is a "development stage company" with no prior operating
history. see "RISK FACTORS - Start-up Enterprise - Lack of Operating History."
Prior to this Offering, there has been no public market for the Common Stock and
it is not anticipated that there will be an active trading market for the
Shares. There can be no assurance that an active trading market for such stock
will develop since the Company presently does not intend to seek to list the
Common Stock on a national securities exchange or to qualify such Common Stock
for quotation on the National Association of Securities Dealers Automated
Quotation System ("NASDAQ").
INVESTMENT IN THE COMPANY INVOLVES A HIGH DEGREE OF RISK, AND INVESTORS SHOULD
NOT INVEST ANY FUNDS IN THIS OFFERING UNLESS THEY CAN AFFORD TO LOSE THEIR
ENTIRE INVESTMENT. SEE "RISK FACTORS" BEGINNING ON PAGE 5 FOR A DISCUSSION OF
THOSE RISKS THAT MANAGEMENT BELIEVES PRESENT THE SUBSTANTIAL RISKS TO AN
INVESTOR IN THIS OFFERING.
THE SECURITIES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS OR SAVINGS DEPOSITS AND
ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE SEC PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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PRICE UNDERWRITING
TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) THE COMPANY
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Per unit.......................... $10 $0 $ 10
Minimum(3)........................ $7,000,000 $0 $ 7,000,000
Maximum(3)........................ $15,000,000 $0 $15,000,000
If all warrants are exercised..... $30,000,000 $0 $30,000,000
====================================================================================
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The Date of this Prospectus is February 8, 1999.
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(Continuation of front cover)
- -----------------------------
(1) The Offering price was arbitrarily determined by the Board of Directors of
the Company and does not bear any relationship to the Company's assets,
book value, net worth or any other recognized criteria of value.
(2) Before deducting Offering expenses, estimated to be approximately $30,000
including registration fees, legal and accounting fees, printing and other
expenses. See "USE OF PROCEEDS" for an itemized statement of expenses.
(3) These securities are offered on a best-efforts, 700,000 Unit minimum basis.
If payment in cash for 700,000 Units is not received prior to the end of
the Offering Period, the Offering will terminate and all subscription
funds, together with any interest earned thereon, will be promptly returned
to subscribers. All purchases of Units by the Company's Organizers will be
subject to affiliate resale limitations under the 33 Act and organizer's
purchases as described herein will be made on the same terms, including
Warrant provisions, as those made by other investors. The Organizers of the
Company have represented to the Company that all purchases of Common Stock
will be made for investment purposes only and not with a view toward
resale. The maximum number of Shares that will be sold in the Offering will
be 1,500,000 shares. In the event the maximum number of Shares are sold,
followed by the exercise of all of the Warrants to be issued, then the
maximum number of Shares which will be outstanding is 3,000,000. There can,
however, be no assurance given that any of the Warrants will be exercised.
See "RISK FACTORS," "TERMS OF THE OFFERING," and "ORGANIZERS AND PRINCIPAL
SHAREHOLDERS."
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ARCHITECTURAL RENDERING OF THE
BAY CITIES BANK'S HOME OFFICE LOCATION.
The Bank will lease its permanent home in 8,000 square feet of the ground floor
of the International Plaza upon completion in the fall of 1999. See: "BUSINESS
OF THE COMPANY - Premises" on page 17 of the Prospectus for more details.
[FRONT]
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A MAP OF THE STATE OF FLORIDA IN THE SHAPE
OF THE STATE WITH A SMALL RECTANGULAR MAP OF
THE WESTSHORE AREA OF HILLSBOROUGH COUNTY.
[BACK]
<PAGE> 6
AVAILABLE INFORMATION
Prior to the Offering, the Company has not been required to file reports
under the Securities Exchange Act of 1934 ("Exchange Act").
The Company has filed electronically with the SEC through its Electronic
Data Gathering Analysis and Retrieval ("EDGAR") system, a Registration Statement
on Form SB-2, as amended, (together will all exhibits and schedules thereto, the
"Registration Statement") under the Securities Act of 1933, as amended with
respect to the registration of the Units and shares offered by this Prospectus.
This Prospectus does not contain all of the information set forth in such
Registration Statement and the exhibits thereto, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. For
further information pertaining to the Units and Shares offered by this
Prospectus and related matters, reference is made to the Registration Statement,
including the exhibits filed as a part thereof.
The Registration Statement filed electronically with EDGAR by the Company
can be inspected and copied at the public reference facilities maintained by the
Commission at its Public Reference Section, 450 Fifth Street, N.W., Washington,
D.C. 20549. The Commission maintains a web site that contains registration
statements, reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission. The
Company's complete Registration Statement is available for review on this Web
Site. The address of the Web Site is http://www.sec.gov. Copies of exhibits may
also be obtained by written request addressed to: Timothy A. McGuire, President,
Bay Cities Bank (In Organization), Austin Center West, Tower II, 1408 North
Westshore Boulevard, Suite 502, Tampa, Florida 33607.
REPORTS TO SECURITY HOLDERS
The Company intends to furnish annual reports to its shareholders which
will contain audited financial statements. In addition, the Company will be
required, under section 15(d) of the Exchange Act, to file annual and quarterly
reports with the Commission for a limited period of time. Copies of such reports
will be available to the Company's shareholders.
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PROSPECTUS SUMMARY
The following is a summary of certain information contained in this
Prospectus and is qualified in its entirety by the more detailed information and
financial statements appearing elsewhere in this Prospectus. Prospective
investors are urged to read the entire Prospectus carefully.
RISK FACTORS
The securities offered hereby may be deemed to be speculative and involve
certain risks such as:
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- - Start-up Enterprise - Intended Purchases by Organizers
- - Dependency on Key Management - Anti-takeover Provision in Company's
- - Financial Position of the Company and Expected Articles of Incorporation
Lack of Initial Profitability - No Established Market for Shares
- - Highly Competitive Banking Market - Arbitrary Determination of Offering Price
Unpredictable Economic Conditions - Absence of Preemptive Rights
- - Extensive Governmental Regulation - Future Capital Needs of the Bank
- - No Plans to Pay Dividends in the - No Underwriting of this Offering
- - Foreseeable Future - Possible Dilution Resulting from Shares
Possible Return of Less Than the Subscription Issued Under Warrant Plan and Directors'
- - Amount and Incentive Option Plans and Option
Plans
</TABLE>
For these and other reasons, the purchase of the Units is highly
speculative and involves significant investment risks. A prospective investor
should carefully consider the matters set forth under "RISK FACTORS" and should
be prepared to lose his or her entire investment.
THE COMPANY
Florida Business BancGroup, Inc. was organized under the laws of the State
of Florida on May 18, 1998, for the purpose of operating as a bank holding
company pursuant to the Federal Bank Holding Company Act of 1956, as amended
("BHC Act"). The following persons organized the Company and are referred to as
the Organizers: John C. Bierley, Monroe E. Berkman, Troy A. Brown, Jr., Frank G.
Cisneros, Lawrence H. Dimmitt, III, Timothy A. McGuire, Eric M. Newman, Chris A.
Peifer, and A. Bronson Thayer. In order to fund the organizational and
pre-opening expenses of the proposed bank (estimated to be approximately
$400,000), the Organizers have advanced $390,000 to the Company in exchange for
the issuance of preferred stock by the Company of $390,000 in preferred stock
which is redeemable within one year after the release of subscription funds by
the Escrow Agent. The preferred stock pays a dividend at the sole discretion of
the Company and the Company intends to pay a dividend of 2% of the purchase
price within 30 days of the closing of the offering. Through September 30, 1998,
the Company has expended $72,471 for organizational expenses. See "TERMS OF THE
OFFERING - Purchases by Organizers of the Company." The Company intends to use
the net proceeds of this Offering to purchase 100% of the common stock to be
issued by Bay Cities Bank ("Bank"), to repay organizational expenses and for
other general corporate purposes. Neither the Company nor the Bank has commenced
business operations, and neither will do so until the Offering Period is
completed and the requisite approvals of the Florida Department of Banking and
Finance ("Department"), the Federal Deposit Insurance Corporation ("FDIC") and
the Board of Governors of the Federal Reserve System ("Federal Reserve") are
obtained. The main office of the Company and the Bank will be located in Tampa,
Hillsborough County, Florida. The Company's mailing address during the
organizational period is Austin Center West, Tower II, 1408 North Westshore
Boulevard, Suite 502, Tampa, Florida 33607 and the Company's telephone number is
(813) 281-0009. See "THE COMPANY."
THE BANK
It is anticipated that the Bank will commence business operations sometime
in the second quarter of 1999, or as soon thereafter as practicable. The Bank
will engage in a general commercial and retail banking business with primary
emphasis upon high quality service to meet the financial needs of the
individuals and businesses residing and located in and around Tampa, Florida. As
part of its regular business operations, the Bank will offer a full complement
of loans, including commercial, consumer/installment and real estate loans. The
Organizers expect that commercial
3
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loans will account for approximately one-half of the Bank's estimated total loan
portfolio. Commercial loans are loans made to individual, partnership or
corporate borrowers for a variety of business purposes. Commercial loans have a
higher risk of loss than consumer or real estate loans. To the extent that
borrowers fail to repay their loans, such failure may have a material adverse
effect on the Bank's and the Company's earnings and overall financial condition,
as well as, the value of the Common Stock. See "BUSINESS OF THE BANK."
It is intended that the Bank will operate at Austin Center West, Tower II,
1408 North Westshore Boulevard, Suite 502, Tampa, Florida 33607, for at least
the first 8 months of operation, and that the Bank's permanent facility will be
available for occupancy by October 1, 1999. The Company has entered into lease
agreements with NovaCare, Inc. for the temporary facility and Crescent
Resources, for the permanent facility. The permanent facility is to be located
in a commercial office building to be known as International Plaza. See
"BUSINESS OF THE COMPANY - Premises" and "BUSINESS OF THE BANK - General."
TERMS AND CONDITIONS OF THE OFFERING
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Units Offered .......................... Up to 1,500,000 Shares of Common
Stock ("Shares") are being offered to
the public in Units consisting of one
share of Common Stock and one
Warrant. A minimum of 700,000 Units
are required to be sold in this
Offering. See "TERMS OF THE OFFERING."
Warrants ............................... The Board has adopted a Warrant Plan
which permits the Company to issue up
to 1,500,000 Warrants in connection
with the Offering. Each Warrant will
entitle the holder thereof to
purchase one share of additional
Common Stock for $10.00 per share
during the 36-month period following
the Effective Date of Registration of
the Shares. Warrants will expire 36
months from the Effective Date of
Registration, unless redeemed sooner
by the Company. The Warrants are
transferrable only in connection with
the transfer of a like number of
Shares. See "TERMS OF THE OFFERING -
Warrants."
Common Stock Outstanding After the
Offering (exclusive of any shares issued
pursuant to the exercise of warrants and
options) ............................... Minimum - 700,000 Shares
Maximum - 1,500,000 Shares
Price .................................. $10.00 per Unit.
Use of Proceeds ........................ Proceeds of the Offering will be used
to purchase 100% of the issued and
outstanding capital stock of the
Bank; to provide working capital for
the Bank to commence its business
operations (including officers' and
employees' salaries); to pay expenses
in connection with the formation of
the Company, the organization of the
Bank, and this Offering; and for
other corporate purposes of the
Company. Proceeds not used to
purchase Bank stock will be retained
by the Company and will be used to
fund future capital requirements of
the Bank, as well as for other
permissible investments for bank
holding companies, including the
possible acquisition of other
financial institutions. See "USE OF
PROCEEDS."
Conditions of the Offering ............. The Offering will expire 90 days from
the Effective Date of Registration
unless extended for up to an
additional 90 days by the Company.
Funds received by the Company during
the Offering Period will be deposited
with the Escrow Agent. Funds so
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deposited may be released to the Company only in accordance with the
terms of the Escrow Agreement between the Company and the Escrow Agent.
The Offering will be terminated by the Company at the end of the Offering
Period if subscriptions for 700,000 Units have not been received and
deposited with the Escrow Agent or if all conditional regulatory approvals
have not been received by the Company and the Bank, or the Company has
canceled the Offering prior to withdrawing funds from the
Subscription Account.
Stock Options . . . . . . . . The Company intends to grant each of the proposed Organizing
directors options to purchase 7,694 shares of common stock under a
non-qualified Directors Stock Option Plan. The Company intends to grant
Timothy A. McGuire, the President of the Company and President and Chief
Executive Officer of the Bank, incentive stock options to purchase a
minimum of 34,444 shares of common stock pursuant to an Employee Stock
Option Plan. These stock options, which the Company intends to grant at no
cost to the directors or employees, bear a minimum exercise price of $10.00
per share, and are subject to shareholder approval following the Bank's
commencement of business. See "ORGANIZERS AND PRINCIPAL SHAREHOLDERS."
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RISK FACTORS
PROSPECTIVE INVESTORS IN THE COMMON STOCK SHOULD GIVE CAREFUL ATTENTION TO
THE FOLLOWING STATEMENTS WHICH DESCRIBE ALL MATERIAL RISKS APPLICABLE TO THE
OFFERING.
START-UP ENTERPRISE - LACK OF OPERATING HISTORY
Neither the Company nor the Bank has commenced business operations. Both
are newly organized entities with no operating history. The business of the
Company and the Bank is therefore subject to the risks associated with new
businesses. In addition, because the Bank has not commenced operations,
investors will not have the information normally associated with investments in
a financial institution with a history of operations. The Company's
profitability will depend primarily on the operations of the Bank. Therefore,
without any operating history there can be no assurance the Company will ever be
profitable.
DEPENDENCY ON KEY MANAGEMENT
Regulatory approval to establish and operate a state-chartered bank is,
among other things, dependent upon the Department's approval of such bank's
proposed chief executive officer. Generally, the chief executive officer of a
start-up financial institution is deemed to be vital to the potential success of
the new institution. The Bank's application for a charter filed with the
Department proposed Timothy A. McGuire as the Bank's Chief Executive Officer. In
the event of death, disability, resignation or other event causing the
unavailability of Mr. McGuire, final regulatory approval to commence banking
operations would be delayed until such time as a suitable replacement is
approved by the Department. The Company has obtained "Key Man" life insurance on
the life of Mr. Timothy A. McGuire in the amount of $250,000. See "MANAGEMENT."
FAILURE TO RECEIVE REGULATORY APPROVALS/COMMENCE OPERATIONS; POSSIBLE PARTIAL
LOSS OF SUBSCRIPTION FUNDS
The Company must obtain final approval from both the Department and the
FDIC before it can open the Bank for business, but the Company expects to issue
Common Stock and expand a portion of the proceeds of this Offering before it has
obtained all final regulatory approvals. The Company has filed an application
with the FDIC and the Florida Department of Banking and Finance and will file an
application with the Federal Reserve. If these applications are approved,
approvals will contain certain conditions for opening the Bank. In the event
that all final approvals to commence banking operations are not granted, or if
for any reason the Bank does not commence operations within twelve months after
receipt of conditional approval by the Department, the Company will solicit
shareholder approval for its dissolution or liquidation. In a liquidation or
dissolution, the Organizers who purchased preferred stock will receive a
distribution preference and will be repaid their purchase price prior to any
distribution to purchasers of common stock. It is, therefore, likely that
subscribers will receive only a portion of their initial investment in the event
that the Bank is unable to commence operations. See "TERMS OF THE OFFERING -
Failure of Bank to Commence Operations."
FINANCIAL POSITION OF THE COMPANY AND EXPECTED LACK OF INITIAL PROFITABILITY
The initial activity of the Company will be to act as the sole shareholder
of the Bank. Thus, the profitability of the Company will be dependent upon the
successful operation of the Bank. Typically, new banks are not profitable in the
first year of operation and sometimes are not profitable for several years. The
Bank will incur significant expenses in establishing itself as a going concern
and there can be no assurance that the Bank will be operated profitably or that
future earnings, if any, will meet the levels of earnings prevailing in the
banking industry. Although there can be no assurance of success, the Organizers
believe the Bank will be able to successfully implement its business plan as a
result of the selection of a favorable market area and the experience and
personal contacts of its Board of Directors and management.
HIGHLY COMPETITIVE BANKING MARKET
The Bank will engage in a general commercial and retail banking business in
Tampa, Hillsborough County, Florida. Competition among financial institutions in
the Bank's primary market area is intense. The Bank will compete
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with other state banks, consumer finance companies, money market mutual funds,
and other financial institutions which have far greater financial resources than
those available to the Bank. Additionally, the Bank will compete with banks,
savings institutions and credit unions located in nearby markets which solicit
business from the Bank's Primary Service Area. If the Bank is unable to compete
for deposits effectively in its primary service area, such inability would
likely have an adverse effect on the Bank's potential for growth and
profitability. See "BUSINESS OF THE BANK - Market Area and Competition."
UNPREDICTABLE ECONOMIC CONDITIONS
Commercial banks and other financial institutions are affected by economic
and political conditions, both domestic and international, and by governmental
monetary policies. Conditions such as inflation, recession, unemployment, high
interest rates, short money supply, international disorders and other factors
beyond the control of the Company and the Bank may adversely affect their
profitability. See "BUSINESS OF THE BANK - Monetary Policies."
EXTENSIVE GOVERNMENTAL REGULATION
The Company and the Bank will operate in a highly regulated environment and
will be subject to supervision by several governmental regulatory agencies,
including the Federal Reserve, the Department, the FDIC and the Commission. The
regulations governing the Company and the Bank are intended to protect
depositors, not shareholders. The Company and the Bank will be vulnerable to
future legislation and government policy, including bank deregulation and
interstate expansion, which could adversely affect the banking industry as a
whole, including the operations of the Company and the Bank. See "SUPERVISION
AND REGULATION."
NO PLANS TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE
It is not anticipated that the Company will distribute any dividends to
shareholders in the foreseeable future. Earnings of the Bank, if any, are
expected to be retained by the Bank to enhance its capital structure or
distributed to the Company to defray its operating costs. Dividend by state
banks are restricted by statute and regulation. See "DIVIDEND POLICY."
INTENDED PURCHASES AND POSSIBLE CONTROL OF THE COMPANY BY ORGANIZERS
The Organizers intend to purchase 305,000 Units in the Offering. These
purchases will represent 43.57% of the minimum of 700,000 Units required in
order to release subscription proceeds from the Subscription Escrow Account. The
exercise of Warrants or Options by the Organizers may result in Organizers
increasing their percentage of ownership thereby diluting non-organizers'
percentage of ownership. Assuming the sale of 700,000 Units, all of which
contain one Warrant, should the Organizers exercise all of their warrants and
options and other shareholders not exercise their warrants, the organizers would
own 64.12% of the outstanding common stock of the Company. See "ORGANIZERS AND
PRINCIPAL SHAREHOLDERS." The Organizers may purchase all of the Units sold in
the Offering. The ownership of more than 25% of the Company's Shares will
virtually assure control of the election of directors of the Company in future
years. The Organizers have represented to the Company that all purchases of
Common Stock will be made for investment purposes only and not with a view
toward resale. See "TERMS OF THE OFFERING - Purchases by Organizers of the
Company" and "ORGANIZERS AND PRINCIPAL SHAREHOLDERS."
POSSIBLE CREDITORS CLAIMS AGAINST THE COMPANY
Once the Company issues the shares of Common Stock offered hereby, the
Offering proceeds may be considered part of general corporate funds and thus may
be subject to the claims of creditors of the Company, including claims against
the Company that may arise out of actions of the Company's officers, directors,
or employees. It is possible, therefore, that one or more creditors may seek to
attach the proceeds of the Offering prior to the Bank's commencement of banking
operations. If such an attachment occurs and it becomes necessary to refund the
subscription proceeds to shareholders because of the failure to obtain the
required regulatory approvals, the refund process might be delayed and will be
reduced by the amount of the attachment.
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ANTI-TAKEOVER PROVISIONS
The Company's Articles of Incorporation ("Articles") contain provisions
requiring supermajority shareholder approval to effect certain extraordinary
corporate transactions which are not approved by the Board of Directors. The
effect of these provisions is to make it more difficult to effect a merger, sale
of control or similar transaction involving the Company even though a majority
of the Company's shareholders may vote in favor of such a transaction. In
addition, the Company's Articles provide for classes of Directors, whereby
one-third of the members of the Board of Directors shall be elected each year
and each director of the Company will serve for a term of three years. The
effect of these provisions is to make it more difficult to effect a change in
control of the Company through the acquisition of a large block of the Company's
Common Stock. See "DESCRIPTION OF COMMON STOCK" and "Appendix A."
EFFECT OF PREFERRED STOCK
The Company's Articles of Incorporation, as amended, permit the Company to
issue preferred stock with such terms and rights as the Board of Directors may
determine in its discretion, including dividend, redemption payments, and
liquidation payments in preference to dividends or payments to common
stockholders. Such dividends or payments could reduce the book value or market
value of common shares. The Board has established a Series A preferred stock and
the Company has issued 3,900 shares of Series A preferred stock to the
Organizers at $100 per share to obtain capital to pay for pre-opening and
organizing expense. Series A preferred stock is redeemable at the option of the
Company, pays a dividend at the discretion of the Board of Directors, and has a
distribution preference in the event of liquidation of the Company. Although the
Company intends to issue a one-time dividend equal to 2% of the purchase price,
there can be no assurance that the Company will not issue further dividends to
series A preferred shareholders or that the Company will not designate and issue
other series of preferred stock with dividend, redemption or preferred
distribution rights. See "TERMS OF THE OFFERING Purchase by Organizers of the
Company" and "Articles of Incorporation Summary Preferred Stock."
NO ESTABLISHED MARKET FOR SHARES
Presently there is no established market for the Common Stock. There can be
no assurance that an established public market will develop for such securities
upon completion of this Offering or that substantial trading activity in the
Shares will occur for several years, if at all. Moreover, in the event that the
Organizers subscribe for additional Units in this Offering, an established
public market of the Common Stock will be less likely to develop. As a result,
investors who may need or wish to dispose of all or a part of their investment
in the Common Stock may not be able to do so except by private, direct
negotiations with third parties. The Company does not presently intend to seek
to list the Common Stock on a national securities exchange or to qualify such
Common Stock for quotation on NASDAQ. At such time as the Company's stock
qualifies for listing on NASDAQ, the Company may seek to list the Shares for
quotation.
ARBITRARY DETERMINATION OF OFFERING PRICE
The Offering price was arbitrarily determined by the Board of Directors of
the Company, and does not bear any relationship to the Company's assets, book
value, net worth or any other recognized criteria of value. In determining the
Offering price of the Shares, the Department's capital requirements for the Bank
and general market conditions for the sale of such securities were considered.
ABSENCE OF SHAREHOLDER PREEMPTIVE RIGHTS
No holder of the Common Stock of the Company will have preemptive rights
with respect to the issuance of shares of any class of stock. The total number
of shares of Common Stock which the Company shall have the authority to issue is
10,000,000 shares of Common Stock. Each share of Common Stock is entitled to one
vote per share in all matters requiring a vote of shareholders. The Board of
Directors of the Company could from time to time determine to issue additional
shares of the authorized Common Stock in addition to the shares offered hereby,
and in such event the ownership interest of the subscribers in this Offering may
be diluted.
FUTURE CAPITAL NEEDS OF THE BANK
The Board of Directors of the Company may determine from time to time to
obtain additional capital through the issuance of additional shares of the
authorized Common Stock of the Company. There can be no assurance that such
shares will be issued at prices or on terms equal to the Offering price and
terms of this Offering.
8
<PAGE> 13
NO UNDERWRITER OF THIS OFFERING
This Offering is being made without the services of an underwriter. Sales
of the Company's Units will be solicited only by certain executive officers and
directors of the Company. Accordingly, there can be no assurance that the
minimum number of Units required to be sold will be sold at the expiration of
the Offering period. Although the Company has no plans to engage an underwriter
to sell Units, the Company may engage an underwriter in the event that the
Offering Conditions have not been satisfied by February, 1999. Such an
engagement would substantially increase offering expenses. See "TERMS OF THE
OFFERING -- Other Terms."
POSSIBLE DILUTION RESULTING FROM WARRANTS AND OPTIONS
Up to 1,500,000 Shares may be issued pursuant to the exercise of Warrants
issued in the Offering, assuming the sale of all 1,500,000 Units. Additionally,
up to 57,496 Shares may be issued pursuant to the Directors' Stock Option Plan
("Directors' Plan") and the Key Employee Stock Option Plan ("Incentive Plan").
In the event all Warrants and Options are exercised, the Company will have
3,057,496 Shares outstanding. Warrants issued in this Offering are transferable
only if transferred simultaneously in conjunction with an equal number of
Shares. Shareholders who do not exercise, or are not able to exercise Warrants
received in this Offering, may suffer a dilution of their investment in terms of
book value if other Warrant or Option holders exercise their Warrants or Options
and the book value of the Shares is greater than $10.00 at the time of such
exercise. In addition, an individual shareholder's percentage of ownership may
be reduced if such shareholder fails to exercise his or her Warrants and other
shareholders exercise their Warrants or Options. See Organizers and Principal
Shareholders.
MINIMUM AND MAXIMUM LENDING LIMITS
Florida Law allows a state bank to extend credit to any one borrower in an
amount up to 25% of its capital accounts, provided that the unsecured portion of
any such loan may not exceed 15% of the capital accounts of the bank. Based upon
the proposed investment of $6,000,000 in capital stock of the Bank, the maximum
loan the Bank will be permitted to make is $1,500,000, provided that the
unsecured portion may not exceed $900,000. Assuming that the maximum proceeds of
the Offering including the exercise of all warrants were invested in the Bank,
the maximum loan the Bank would be permitted to make would be approximately
$7,500,000 provided that the unsecured portion could not exceed $4,500,000.
YEAR 2000; POTENTIAL ADVERSE EFFECTS ON BUSINESS, FINANCIAL CONDITIONS, OR
RESULTS OF OPERATION
Like many financial institutions, the Bank will rely upon computers for the
daily conduct of its business and for information systems processing. There is
concern among industry experts that on January 1, 2000, computers will be unable
to "read" the new year and there may be widespread computer malfunctions. While
the Company believe that it has available resources, and has adopted a plan, to
address Year 2000 compliance, the plan is largely dependent on third party
vendors. Vendors have informed the Company that their software is Year 2000
compliant or, if not, that they have adopted plans to ensure compliance.
Internal systems and software will be adequately programmed to address the Year
2000 issue. These systems will be tested to confirm that they will be Year 2000
compliant. Nevertheless, there is a risk that some hardware or software may not
be Year 2000 compliant, and the Company cannot, therefore, predict with any
certainty costs which might be incurred to respond to any Year 2000 issues.
Further, the business of many of the Bank's customers may be negatively
affected by the Year 2000 issue, and any financial difficulties incurred by the
Bank's customers in solving Year 2000 issues could negatively affect these
customers' ability to repay any loans which the Bank may have extended.
Therefore, even if the Bank does not incur significant direct costs in
connection with responding to the Year 2000 issue, there is a risk that the
failure or delay of customers or other third parties in addressing the Year 2000
issue or the costs involved in such process could have a material adverse effect
on the Bank's business, financial condition, or results of operations.
THE COMPANY
Florida Business BancGroup, Inc. was incorporated under the laws of the
State of Florida on May 18, 1998 to operate as a bank holding company pursuant
to the BHC Act, and to purchase 100% of the issued and outstanding capital stock
of Bay Cities Bank, a state-chartered commercial bank to be organized under the
laws of Florida. Bay Cities Bank will conduct a general banking business in
Tampa, Florida. The Organizers filed an Application for
9
<PAGE> 14
Authority to Organize with the Department on September 8, 1998. The Company also
filed its application for federal deposit insurance with the FDIC on September
28, 1998, and is awaiting FDIC conditional approval. The Company expects to file
an application to become a one-bank holding company with the Federal Reserve
Bank of Atlanta in the next 60 days.
The Bank expects to commence operations sometime in the second quarter of
1999, or at the earliest practicable time thereafter. See "BUSINESS OF THE
BANK." The Organizers of the Company are nine individuals, eight of whom reside
in Hillsborough County, Florida and one of which reside in Pinellas County,
Florida. See "ORGANIZERS AND PRINCIPAL SHAREHOLDERS." All of the Organizers of
the Company will serve on both the initial Board of Directors of the Company and
the initial Board of Directors of the Bank. See "MANAGEMENT."
Initially the principal offices of the Company and the Bank will be located
at Austin Center West, Tower II, 1408 North Westshore Boulevard, Suite 502,
Tampa, Florida 33607. See "BUSINESS OF THE COMPANY - Premises." The mailing
address of the Company's present office, which it will occupy until the Bank
opens for business, is Austin Center West, Tower II, 1408 North Westshore
Boulevard, Suite 502, Tampa, Florida 33607, and the Company's telephone number
is (813) 281-0009.
TERMS OF THE OFFERING
GENERAL
The Company is Offering hereunder up to 1,500,000 Shares of its Common
Stock for cash in Units at a price of $10.00 per Unit. A minimum subscription of
1,000 Units is required for each subscription hereunder. No single individual
investor, other than individual Organizers, may subscribe for more than 148,500
Units or more than 9.9% of the total number of Shares issued or subscribed for
at the time a subscription is received by the Company during the Offering
Period. The purchase price of $10.00 per Unit shall be paid in full upon
execution and delivery of the Unit Order Form. All subscriptions tendered by
investors are subject to acceptance by the Board of Directors of the Company
through its duly authorized Subscription Committee, and the Company reserves the
absolute and unqualified right to reject or reduce any subscription for any
reason prior to acceptance. Furthermore, the Company reserves the right to
cancel this Offering at any time prior to the time the Company withdraws funds
from the Subscription Escrow Account, for any reason whatsoever. For a 36-month
period following the effective date of Registration the Company will issue up to
1,500,000 Shares pursuant to the Company's Warrant Plan and the Warrants issued
thereunder.
WARRANTS
The Company has adopted a Warrant Plan which provides for the issuance of
up to 1,500,000 Warrants in connection with the Offering. The Warrant Plan sets
forth the terms and conditions of the Warrants. The Warrants subscribed to will
expire 36 months from the Effective Date of Registration unless redeemed sooner
in accordance with the terms of the Warrant Plan. Unexpired Warrants may be
exchanged for Shares upon the payment of $10.00 per share to the Company,
subject to the requirement that the minimum number of Shares which will be
issued upon any single presentment will be 100 Shares unless the Warrant
presented is for less than 100 Shares, at which time all shares must be
purchased. Certificated Warrants may be transferred by a holder only in
conjunction with the simultaneous transfer of an equal number of Shares.
Warrants may be exercised by presenting an executed Warrant Certificate, along
with a check representing the full amount of the exercise price, to: Timothy A.
McGuire, President, Florida Business BancGroup, Inc. at the main office, Suite
502, Austin Center West, Tower II, 1408 North Westshore Boulevard, Tampa,
Florida 33607, or at such other address established as the main office of the
Company of which the warrant holder is notified.
NO ESTABLISHED MARKET
Prior to this Offering there has been no established public market for the
shares of the Common Stock and/or Warrants and there can be no assurance that an
established market for such stock or Warrants will develop. The Offering price
has been arbitrarily determined and is not a reflection of the Company's book
value, net worth or any other such recognized criteria of value. In determining
the Offering price of the Common Stock, the regulatory capital requirements of
the Bank and general market conditions for the sale of such securities were
considered. There can be no assurance that, if a market should develop for the
Common Stock or Warrants, the post-Offering market price will equal or exceed
the initial Offering price.
10
<PAGE> 15
PLAN OF DISTRIBUTION
Pursuant to Commission Rule 415, (17 C.F.R. Section 230.415), the Company
intends to offer the Units on a continuous basis for a period of up to 180 days
from the effective date and shares to be issued pursuant to the Warrants for up
to three years from the Effective Date.
Units will be offered by certain officers and directors of the Company. The
officers and directors will not receive any commissions or other remuneration in
connection with these activities, but they may be reimbursed for reasonable
expenses incurred as a result of such activities, if any. In reliance on Rule
3a4-1 of the Securities and Exchange Act of 1934 ("Exchange Act"), the Company
believes that its officers and directors who are engaged in the sale of the
Units will not be deemed to be brokers and/or dealers under the Exchange Act.
Units will be offered primarily to persons who work or reside in Hillsborough
County, Florida. To a limited extent, Units will be offered to friends,
acquaintances and family members of the Organizers, some of whom live outside
the Hillsborough County community and some of whom may live outside of the State
of Florida. Persons indicating an interest in acquiring Common Stock will be
provided with a copy of this Prospectus prior to the acceptance of subscription
funds. Subscriptions will be accepted only if accompanied by a proper Unit Order
Form. During this Offering Period the Company will conduct its first Closing if
the conditions required to Close have been met.
CONDITIONS OF THE OFFERING
The Offering will expire at 5:00 p.m. Eastern Time, on August 7, 1999
(the "Expiration Date"). The Offering is expressly conditioned upon fulfillment
of the following conditions ("Offering Conditions") within the Offering Period.
The Offering Conditions, which may not be waived, are as follows:
(a) Subscriptions for not less than $7,000,000 shall have been deposited
with the Escrow Agent;
(b) The Company shall have received conditional approval from the Federal
Reserve of its application to become a one-bank holding company, the
Organizers shall have received conditional approval from the
Department to charter the Bank and the proposed Bank shall have
received conditional approval of its application for deposit insurance
from the FDIC; and
(c) The Company shall not have canceled this Offering prior to the time
funds are withdrawn from the Subscription Escrow Account.
ESCROW OF SUBSCRIPTION FUNDS
All subscription funds and documents tendered by investors will be placed
in the Subscription Escrow Account with the Independent Bankers' Bank of
Florida, Orlando, Florida ("Escrow Agent"), pursuant to the terms of the Escrow
Agreement, the form of which is attached to this Prospectus as Appendix "B."
Upon receipt of a certification from the Company during the Offering Period
that: (i) the required conditional regulatory approvals have been received; and
(ii) subscriptions totaling not less than $7,000,000 have been received, the
Escrow Agent will release all subscription funds, and any income received
thereon, to the Company.
Pending disposition of the Subscription Escrow Account under the Escrow
Agreement, the Escrow Agent is authorized, upon instructions to be given by
either A. Bronson Thayer or Timothy A. McGuire to invest subscription funds in
direct obligations of the United States Government, in short-term insured
certificates of deposit and/or money market management trusts for short-term
obligations of the United States Government, with maturities not to exceed 90
days. The Company will invest the subscription funds in a similar manner after
breaking escrow and prior to the time that the Company infuses capital into the
Bank. The Offering proceeds will be used to purchase capital stock of the Bank
and to repay expenses incurred in the organization of the Company and the Bank.
See "USE OF PROCEEDS."
In the event the Offering Conditions are not met within the Offering Period
or the Offering is terminated by the Company prior to withdrawing the
Subscription Funds, the Escrow Agent shall promptly return to the subscribers
their subscription funds, together with their allocated share of income, if any,
earned on the investment of the Subscription Escrow Account. Each Subscriber's
proportionate share of Subscription Escrow Account earnings shall be that
fraction (i) the numerator of which is the dollar amount of such subscriber's
tendered subscription multiplied by the number of days between the date of
acceptance of the investor's subscription and the date of the termination of the
Offering, inclusive (the subscriber's "Time Subscription Factor"), and (ii) the
denominator of which is the aggregate
11
<PAGE> 16
Time Subscription Factor of all investors depositing subscription funds in the
Subscription Escrow Account. The latest date to which the subscription funds
might be held in escrow prior to their return in the event the minimum is not
reached or the required regulatory approvals are not received is August 7, 1999.
NO ASSURANCE CAN BE GIVEN THAT SUBSCRIPTION FUNDS CAN OR WILL BE INVESTED
AT THE HIGHEST RATE OF RETURN AVAILABLE OR THAT ANY INCOME WILL BE REALIZED FROM
THE INVESTMENT OF SUBSCRIPTION FUNDS.
If all Offering Conditions are satisfied, and the Company withdraws the
subscription funds from the Subscription Escrow Account, all earnings on such
account shall belong to the Company.
The Independent Bankers' Bank of Florida, by accepting appointment as
Escrow Agent under the Escrow Agreement, in no way endorses the purchase of the
Company's securities by any person.
FAILURE OF BANK TO COMMENCE OPERATIONS
The Department requires that a new state bank open for business (i.e.,
obtain a certificate of authorization) within 12 months after receipt of
preliminary approval from the Department. The Organizers anticipate that the
Bank will open for business sometime in the fourth quarter of 1998 or as soon
thereafter as practicable. Because final approval of the Bank's charter is
conditioned on the Company's raising funds to capitalize the Bank at $6,000,000,
the Company expects to issue the shares of Common Stock before it has obtained
all final regulatory approvals for the Bank. In the event that the Company
issues the shares of Common Stock and the Department does not grant the Bank
final regulatory approval to commence banking operations within 12 months after
the Bank's receipt of preliminary approval from the Department, the Company will
promptly return to subscribers all subscription funds and interest earned
thereon, less all expenses incurred by the Company, including the expenses of
the Offering and the organizational and pre-opening expenses of the Company and
the Bank. This return may be further reduced by amounts paid to satisfy claims
of creditors, as discussed in the following paragraph.
Once the Company issues the Common Stock offered hereby, the Offering
proceeds may be considered part of general corporate funds and thus may be
subject to the claims of creditors of the Company, including claims against the
Company that may arise out of actions of the Company's officers, directors, or
employees. It is possible, therefore, that one or more creditors may seek to
attach the proceeds of the Offering prior to the Bank's commencement of banking
operations. If such an attachment occurs and it becomes necessary to pay the
subscription funds to shareholders because of failure to obtain all necessary
regulatory approvals, the payment process might by delayed; and if it becomes
necessary to pay creditors from the subscription funds, the payment to
shareholders will be further reduced. As of September 30, 1998, the Company's
accumulated deficit was $72,471, and the Company will continue to incur
pre-opening expenses until the Bank commences operations. It is estimated that
the Company will expend as much as $400,000 in organizational expenses and in
the event of any liquidation, incur other costs of as much as $300,000, or $1.00
per Share based upon the minimum of 700,000 Shares. No assurances can be given
that such expenses and costs will not significantly exceed this estimate.
PURCHASES BY ORGANIZERS OF THE COMPANY
The Organizers have indicated they intend to purchase 305,000 Units in the
Offering. The Organizers may purchase all of the Shares in the Offering. All
additional purchases will be made on the same terms, including the same number
of Warrants, as those made by other investors. Any such purchases of Units by
the Organizers will be subject to affiliate resale limitations of the 33 Act.
The Organizers have represented to the Company that all purchases will be made
for investment purposes only and not with a view to resell such shares. See
"ORGANIZERS AND PRINCIPAL SHAREHOLDERS."
In order to provide funds for the payment of initial organizational and
pre-opening expenses, the Organizers initially advanced $90,000 to the Company.
The Company's obligation to repay these advances to the Organizers have been
extinguished in exchange for the issuance of 900 shares of redeemable preferred
stock from the Company on September 29, 1998 at a price of $100.00 per share.
The Company has issued an additional 3,000 shares of redeemable preferred stock
to organizers on December 3, 1998 at a price of $100.00 per share. The preferred
stock is redeemable by the Company for the purchase price at any time after the
release of funds by the escrow agent and will have a distribution preference
above common stock in the event of a dissolution of the Company. The preferred
stock pays a dividend at the sole discretion of the Company. The
12
<PAGE> 17
Company intends to declare a dividend of 2% of the purchase price of the
preferred stock within 30 days of the closing of the Offering. The aggregate
amount of the intended dividend is $7,800 and will be paid from the interest
accumulated on subscription funds in the escrow account.
OTHER TERMS AND CONDITIONS/HOW TO SUBSCRIBE
The Company may cancel this Offering for any reason at any time prior to
the release of subscription funds from the Subscription Escrow Account, and
accepted subscriptions are subject to cancellation in the event that the Company
elects to cancel the Offering in its entirety.
Units will be marketed on a best-efforts basis exclusively through certain
directors and executive officers of the Company, none of whom will receive any
commissions or other form of remuneration based on the sale of the Units. The
Company, therefore, does not have any specific plan to engage an underwriter to
sell the Units at this time. However, in the event that the Offering Conditions
have not been satisfied by April 6, 1999, the Company may engage an underwriter
to sell the Units on a best-efforts basis and such underwriter would receive a
commission based upon such sales. It is anticipated that commissions paid to
such underwriter, if retained, will not exceed 10% of the $10.00 per Unit sales
price and that other expenses of such underwriting will not exceed an aggregate
of $100,000. In the event the Company engages an underwriter to sell Units prior
to the expiration of the Offering Period, a post-effective amendment to the
Registration Statement will be filed with the SEC containing the terms of any
agreements entered into with such underwriters and discussing any fees or
expenses associated with such agreements. In the event that the Offering
Conditions have not been satisfied by the end of the Offering Period, this
Offering will be terminated and the subscription funds promptly returned to the
subscribers, together with their allocated share of earnings, if any, earned on
the investment of the Subscription Escrow Account as described herein. See
"TERMS OF THE OFFERING - Escrow of Subscription Funds."
As soon as practicable, but no more than ten-business days after receipt of
a subscription, the Company will accept or reject such subscription.
Subscriptions not rejected by the Company within this ten-day period shall be
deemed accepted. Once a subscription is accepted by the Company, it cannot be
withdrawn by the subscriber. Payment from any subscriber for Units in excess of
the number of Units allocated to such subscriber, if any, will be refunded by
mail, without interest within ten days of the date of rejection.
Subscriptions to purchase shares of Common Stock can be made by completing
the Stock Order Form attached to this Prospectus (Appendix C) and delivering the
same to the Company at its offices, Austin Center West, Tower II, 1408 North
Westshore Boulevard, Suite 502, Tampa, Florida 33607, or mailing the same in the
enclosed self-addressed envelope. Full payment of the purchase price must
accompany the subscription. Failure to pay the full subscription price shall
entitle the Company to disregard the subscription. No Unit Order Form is binding
until accepted by the Company, which may, in its sole discretion, refuse to
accept any subscription for Units, in whole or in part, for any reason
whatsoever. After a subscription is accepted and proper payment received, the
Company shall not cancel such subscription unless all accepted subscriptions are
canceled. Unless otherwise agreed by the Company, all subscription amounts must
be paid in United States currency by check, bank draft or money order payable to
"IBBF, FOR FLORIDA BUSINESS BANCGROUP, INC." A subscription will be accepted in
writing by the Company only in the Form of Acceptance attached to this
Prospectus.
USE OF PROCEEDS
The gross proceeds from the sale of the minimum number of Units offered by
the Company are estimated to be $7,000,000. This estimate is based upon the
assumption that the sale of 700,000 Units occurs prior to the expiration of the
Offering Period. However, if 700,000 Units are not sold, prior to the expiration
of the Offering Period, then the Offering will terminate and all funds received
from subscribers, adjusted for any income thereon, will be promptly refunded.
See "TERMS OF THE OFFERING."
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<PAGE> 18
The estimated Organizational and Offering expenses of the Company and the
Bank are as follows:
<TABLE>
<S> <C>
Offering Expenses(1) $ 60,000
Organizational Expenses(2) 150,000
Pre-opening Expenses(3) 270,000
-----------
TOTAL $ 480,000
===========
</TABLE>
- ---------------
(1) Comprised primarily of certain legal fees, marketing costs, registration
fees, accounting fees, escrow fees, printing and mailing costs and other
offering expenditures.
(2) Organizational expenses include, among other expenditures, application
fees, legal and other professional costs.
(3) Pre-opening expenses include, among other expenditures, salaries and
related expenditures, temporary rent and utilities, costs for market
analysis, and pre-opening advertising.
A substantial portion of the proceeds of this Offering ($7,000,000)
assuming the minimum number of Units is sold will be used by the Company for the
purchase of 100% of the issued and outstanding capital stock of the Bank and to
repay the expenses of this Offering and the expenses incurred in the
organization of the Company and the Bank.
A portion of the proceeds of this Offering in excess of the above amounts
will be retained by the Company for the purpose of funding any required future
additions to the capital of the Bank. Since state banks are regulated with
respect to the ratio that their total assets may bear to their total capital, if
the Bank experiences greater growth than anticipated, it may require the
infusion of additional capital to support that growth. Management of the Company
anticipates that the proceeds of the Offering will be sufficient to support the
Bank's immediate capital needs and will seek, if necessary, long and short-term
debt financing to support any additional needs; however, management can give no
assurance that such financing, if needed, will be available or if available will
be on terms acceptable to management.
Proceeds from the Offering will be applied as follows:
<TABLE>
<CAPTION>
MAXIMUM PROCEEDS
MINIMUM PROCEEDS ASSUMING SALE OF
ASSUMING SALE % OF 1,500,000 % OF
700,000 SHARES PROCEEDS SHARES PROCEEDS
---------------- -------- ----------------- ---------
<S> <C> <C> <C> <C>
Purchase of capital stock of the Bank . . . $6,300,000 90.0% $13,000,000 86.7%
Organizational expenses of the Company. . . 120,000 1.8% 120,000 .9%
Offering Expenses . . . . . . . . . . . . . 60,000 .7% 60,000 .3%
Working capital and funds available for
expansion of banking and banking-related
services. . . . . . . . . . . . . . . . . . 520,000 7.9% 1,820,000 12.4%
---------- ------ ----------- ------
Proceeds. . . . . . . . . . . . . . . . . . $7,000,000 100.0% $15,000,000 100.0%
========== ====== =========== ======
</TABLE>
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<PAGE> 19
The following table is a schedule of estimated expenditures to be made by
Bay Cities Bank out of the proceeds from the sale of its capital stock to the
Bank at minimum proceeds.
<TABLE>
<S> <C>
Organizational expenses of Bay Cities Bank, including application, legal and
consulting fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 30,000
Pre-opening expenses of Bay Cities Bank, including salaries, occupancy and
other expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270,000
Furniture, fixtures and equipment . . . . . . . . . . . . . . . . . . . . . . . 384,000
Cash, investments and other assets. . . . . . . . . . . . . . . . . . . . . . . 5,616,000
----------
Total uses of capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,300,000
==========
</TABLE>
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
September 30, 1998, and as adjusted to give effect to the sale of a minimum of
700,000 shares and a maximum of 1,500,000 shares of common stock offered hereby,
at an assumed public offering price of $10.00 per share, net of estimated
offering expenses and the issuance of 3,000 shares of preferred stock in
December, 1998.
<TABLE>
<CAPTION>
ACTUAL AS ADJUSTED AS ADJUSTED FOR
SEPTEMBER 30, FOR MINIMUM MAXIMUM
1998 OFFERING OFFERING
------------- ----------- ----------------
(Dollars in Thousands)
<S> <C> <C> <C>
Stockholders' equity:
Preferred Stock, $0.01 par value, authorized and
unissued 2,000,000 shares $90 $ 390 $ 390
Common Stock, $.01 par value, 8,000,000 shares
authorized, none issued
(700,000 shares at the minimum offering and
1,500,000 shares at the maximum offering) - 7 15
Additional paid-in capital - 6,993 14,985
Accumulated deficit (72) (72) (72)
--- ------ -------
Total capitalization $18 $7,318 $15,318
=== ====== =======
</TABLE>
DIVIDEND POLICY
As the Company and the Bank are both start-up operations, it will be the
policy of the Board of Directors of the Company to reinvest earnings for such
period of time as is necessary to ensure the successful operations of the
Company and of the Bank. There are no current plans to initiate payment of cash
dividends, and future dividend policy will depend on the Bank's earnings,
capital requirements, financial condition and other factors considered relevant
by the Board of Directors of the Company.
The Bank will be restricted in its ability to pay dividends under Florida
banking laws and by regulations of the Department. Pursuant to Section 658.37,
Florida Statutes, a state bank may not pay dividends from its capital. All
dividends must be paid out of current net profits then on hand plus retained net
profits of the preceding two years, after deducting bad debts, depreciation and
other worthless assets, and after making provision for reasonably anticipated
future losses on loans and other assets. Payments of dividends out of net
profits is further limited by Section 658.37, which prohibits a bank from
declaring a dividend on its shares of common stock until its surplus equals its
stated capital, unless there has been transferred to surplus not less than 20%
of a bank's net profits for the preceding year (in the case of an annual
dividend). Finally, a state bank may not declare a dividend which would cause
the capital accounts of a
15
<PAGE> 20
bank to fall below the minimum amount required by law, regulation, order or any
written agreement with the Department or any Federal regulatory agency.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Company is still in the development stage, and will remain in that
state until the Offering of the Company's Common Stock is complete. The
Organizers initially advanced $90,000 to the Company. The Company's obligation
to repay these advances to the Organizers has been extinguished in exchange for
the issuance of 900 shares of redeemable preferred stock from the Company at a
price of $100 per share. Through September 30, 1998, the Company has expended
$72,471 for organizational costs including attorney fees, employee compensation
and filing fees. The remaining funds will be used to fund costs and expenses
during the Offering Period. Subscription funds during the Offering Period
contemplated herein will be placed in the Subscription Escrow Account and
invested in direct obligations of the United States Government, in short-term
insured certificates of deposits and/or money market Management trusts for
short-term obligations of the United States Government, with maturities not to
exceed 90 days.
On September 3, 1998, the Company entered into a lease agreement with
NovaCare, Inc. to lease the Bank's temporary quarters until the permanent
quarters becomes available. The Company has given a good faith deposit in the
amount of $4,054.66.
Management of the Company believes that the proceeds of $7,000,000 from the
Offering will satisfy the cash requirements of the Company and the Bank for
their respective first years of operation. It is not anticipated that the
Company will find it necessary to raise additional funds to meet expenditures
required to operate the business of the Company and the Bank over the next 12
months. All anticipated material expenditures for such period have been
identified and provided for out of the proceeds of this Offering. See "USE OF
PROCEEDS."
NEED FOR TECHNOLOGICAL CHANGE; YEAR 2000 COMPLIANCE
The banking industry is undergoing rapid technological changes with
frequent introductions of new technology-driven products and services. In
addition to better serving customers, the effective use of technology increases
efficiency and enables financial institutions to reduce costs. The Company's
future success will depend in part on its ability to address the needs of its
clients by using technology to provide products and services that will satisfy
client demands for convenience as well as to create additional efficiencies in
the Bank's operations. Many of the Bank's competitors have substantially greater
resources to invest in technological improvements. There can be no assurance
that the Bank will be able to effectively implement new technology-driven
products and services or be successful in marketing such products and services
to its clients.
The Company is acutely aware of the many areas affected by the Year 2000
computer issue, as addressed by the Federal Financial Institutions Examination
Council ("FFIEC") in its interagency statement which provided an outline for
institutions to effectively manage the Year 2000 challenges. Management is in
the process of completing a Year 2000 plan which will be approved by the Board
of Directors and will include multiple phases, tasks to be completed, and target
dates for completion. Issues addressed will include awareness, assessment,
renovation, validation, implementation, testing, and contingency planning.
The Company's main service provider has completed testing of its mission
critical application software and item processing software; the test results,
which have been documented and validated, are deemed to be Year 2000 compliant.
FFIEC guidance on testing Year 2000 compliance of service providers states that
proxy tests are acceptable compliance tests. In proxy testing, the service
provider tests with a representative sample of financial institutions that use a
particular service, with the results of such testing shared with all similarly
situated clients of the service provider. The Company has authorized the
acceptance of proxy testing since the proxy tests have been conducted with
financial institutions that are similar in type and complexity to its own, using
the same version of the Year 2000 ready software and the same hardware operating
systems.
The Company also recognizes the importance of determining that its
potential loan customer's will face the Year 2000 problem in a timely manner to
avoid deterioration of the loan portfolio solely due to this issue. The Company
plans to identify any borrower having high Year 2000 risk exposure and taking
such exposure into consideration in underwriting any loan to such borrowers. To
such the extent the Bank identifies a year 2000 exposure associated with a
proposed borrower but determines to make a loan to such borrower, the Bank will
work on a one-to-one basis with the borrower to resolve the exposure.
Accordingly, management does not believe that the Company has incurred or
will incur material costs associated with the Year 2000 issue. Yet, there can be
no assurances that all hardware and software that the Company will use will be
Year 2000 compliant. Management cannot predict the amount of financial
difficulties it may incur due to customers and vendors inability to perform
according to their agreements with the Company or the effects that other third
parties may cause as a result of this issue. Therefore, there can be no
assurance that the failure or delay of others to address the issue or that the
costs involved in such process will not have a material adverse effect on the
Company's business financial condition, and results of operations.
The Company's contingency plans relative to Year 2000 issues have not been
finalized - these plans are evolving as the Bank prepares to open. During the
organizational phase management will determine if it is necessary to develop a
"worst case scenario" contingency plan. Based on vendor representation to date
(as noted above), the Company's mission critical systems are expected to be Year
2000 compliant when the Bank opens or shortly thereafter, and, therefore a
contingency plan has not been developed with respect to those systems. With
regards to non-mission critical internal systems, the Company's plans are to
acquire only those systems that are vendor certified as being Year 2000
compliant. Alternatively, some systems could be handled manually on an interim
basis. Should outside service providers not be able to provide compliant
systems, the Company will terminate those relationships and transfer to other
vendors.
BUSINESS OF THE COMPANY
GENERAL
The Company was incorporated under the laws of the State of Florida on May
18, 1998 for the purpose of organizing the Bank and purchasing 100% of the
outstanding capital stock of the Bank. The Company has been organized as a
mechanism to enhance the Bank's ability to serve its future customers'
requirements for financial services. The holding company structure will also
provide flexibility for expansion of the Company's banking business through
acquisition of other financial institutions and provision of additional
banking-related services which the traditional commercial bank may not provide
under present laws. Finally, banking regulations require that the Bank maintain
a minimum ratio of capital to assets. In the event that the Bank's growth is
such that this minimum ratio is not maintained, the Company may borrow funds,
subject to the capital adequacy guidelines of the Federal Reserve, and
contribute them to the capital of the Bank and otherwise raise capital in a
manner which is unavailable to the Bank under existing banking regulations.
The Company has no present plans to acquire any operating subsidiaries
other than the Bank; however, the Company may make additional acquisitions in
the event that such acquisitions are deemed to be in the best interest of the
Company and its shareholders. Such acquisitions, if any, will be subject to
certain regulatory approvals and requirements. See " SUPERVISION AND
REGULATION."
PREMISES
The Bank's permanent headquarters will be located at the northwest corner
of the intersection of N. Westshore Boulevard and Spruce Street in a new 6-story
office building to be developed by Crescent Resources (a subsidiary of Duke
Energy Corp.). The Bank will occupy approximately 8,000 square feet on the
ground floor. The building is scheduled for occupancy in September, 1999.
16
<PAGE> 21
BUSINESS OF THE BANK
GENERAL
Bay Cities Bank (the "Bank") seeks to be one of the premier community-based
financial institution in its market area by providing exceptional personalized
bank products and traditional bank services to individuals, small to
medium-sized businesses, professionals and other local organizations in its
market area; and by providing a maximum return to shareholders.
The Bank will emphasize personal contacts by the officers, directors and
employees of the Bank. Loan participations will be arranged for customers whose
loan demands exceed the Bank's lending limits. Generally, customers will have
one account officer to serve all of their banking needs and will have access to
senior management when necessary. The Bank will provide a full range of
competitive banking services; however, the marketing emphasis will be on the way
services are delivered, more than on which services are provided. Management of
the Bank intends to focus its efforts on filling the void caused by the
dwindling service provided by larger banks.
Bay Cities Bank will focus and rely on its base of local directors,
stockholders, management and employees for business development, as other banks
in this market continue to merge, consolidate and grow outside the area.
Policies and procedures will be tailored to the local market rather than to the
regional and statewide markets of other financial institutions. Local directors
and management know the people in its market area and understand their
businesses. Management will actively promote the Bank within the market due
through their established reputations and banking relationships in the local
community. Customers will be derived from Bank directors, stockholders, their
friends, relatives and business associates and others within the community who
desire superior personalized banking services unavailable from the regional and
statewide financial institutions. The bank is committed to being locally owned
and managed.
The high turnover and more rigid style of large regional banks have created
segments of the marketplace that are ready to change their banking
relationships. Additionally, growth in residential and commercial activity in
the market area and surrounding counties creates opportunities for the Bank to
establish new banking relationships.
Profitable banking relationships are those with high deposit balances,
infrequent transactions and low distribution requirements. Bay Cities Bank will
be well positioned to establish these relationships with commercial and consumer
customers through the active marketing efforts of the directors, management, and
employees of the Bank and the opportunities created by the growth of the market
area and recent mergers.
The Bank intends to concentrate its advertising message on the advantages
of local ownership and management, as well as, fiscal responsibility, personal
service and customer relations at the local level. Particular emphasis will be
placed on newspaper and radio advertising, and direct mail on a selective basis.
THE MARKET AREA
The Bank's primary market is the Tampa Bay Metropolitan Statistical Area
("Tampa Bay MSA") with a population of 2,240,000. The Tampa Bay MSA is comprised
of four counties:
1. HILLSBOROUGH COUNTY
Hillsborough County had a population of 918,800 as of 1996 per the Sales
and Marketing Management, Demographics USA 1997. Hillsborough County is the
business center for the region, has as its center Tampa International
Airport which boarded 13.0 million passengers in 1996 up from 10.6 million
in 1990.
2. PINELLAS COUNTY
Pinellas County, with a population of 884,000, is the most densely
populated county in the state, has 125 different municipalities, and was at
one time, primarily residential, retirement and tourist-oriented. Today, it
has five well-defined business centers and has become a popular relocation
and startup location for high-tech, software and computer service
companies. Pinellas County is home to 24 public companies.
3. PASCO COUNTY
Pasco County, formerly possessing a split personality...retired, Republican
and residential on the west side and agricultural, Democratic and rural on
the east side, has now unified into a residential-commuter district feeding
17
<PAGE> 22
into Hillsborough and Pinellas county businesses. In time, there will be
business relocations and startups in Pasco. Two of the top ten residential
communities in Tampa Bay MSA are in the south Pasco region. It is 23 miles
from the West Shore Business District and accessible by the Veterans
Expressway, a new toll road which opened in 1996, and Interstate 75. Pasco
County had a population of 315,100 at that time.
4. HERNANDO COUNTY
Hernando County, to the north of Pasco, is 35 miles from the West Shore
Business District, has been agricultural and rural and is now enjoying a
residential-commuter boom. With a population of 122,300 in 1996, Hernando
County has seen a 173% population increase since 1980.
According to the Tampa Tribune Market Guide - 1998, the Tampa Bay MSA is a
growth market, where year after year the population size is among the top 25
MSAs nationally. The Tampa Bay MSA ranks second in population size and total
number of households among Southeastern metropolitan areas. Only Atlanta has a
larger population. The Tampa Bay MSA has the largest population and the most
households in Florida, ahead of Miami, Ft. Lauderdale and Orlando. Tampa Bay
also ranks high in other vital statistics such as effective buying income and
retail activity, not only in Florida, but in the Southeast and the United
States. The following tables set forth the details on these demographic
statistics:
[Tables Follow This Page]
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<PAGE> 23
TABLE I - TAMPA BAY RANKINGS 1996
<TABLE>
<CAPTION>
TAMPA BAY MSA NATIONAL SOUTHEAST FLORIDA
------------- -------- --------- -------
<S> <C> <C> <C> <C>
Population 2,240,000 22 2 1
Households 933,100 17 2 1
Effective Buying Inc. $36.3 billion 24 2 1
Total Retail Sales $24.6 billion 15 2 1
Food Store Sales $ 3.7 billion 20 2 1
Eating & Drinking $ $ 2.4 billion 18 2 1
General Merchandise $ 2.4 billion 26 2 1
Apparel & Accessories $ .8 billion 34 5 5
Furniture/Home Furnishing Appliances $ 1.3 billion 22 3 2
Building Materials & Hardware $ 1.1 billion 22 2 1
Drug Store Sales $ 1.0 billion 14 3 2
Automotive Dealer Sales $ 6.5 billion 16 3 2
</TABLE>
Source: Sales and Marketing, Demographics USA 1997
TABLE II - SOUTHEASTERN POPULOUS METROS - 1996
<TABLE>
<CAPTION>
POPULATION NATIONAL RANK
---------- -------------
<S> <C> <C> <C>
1. Atlanta 3,582,200 9
2. Tampa Bay 2,240,200 22
3. Miami 2,100,200 24
4. Orlando 1,460,200 37
5. Fort Lauderdale 1,452,700 39
</TABLE>
Source: Sales and Marketing, Demographics USA 1997
TABLE III - SOUTHEASTERN HOUSING METROS - 1996
<TABLE>
<CAPTION>
HOUSEHOLDS NATIONAL RANK
---------- -------------
<S> <C> <C> <C>
1. Atlanta 1,330,200 9
2. Tampa Bay 933,100 17
3. Miami 737,100 25
4. Fort Lauderdale 608,700 30
5. Orlando 551,500 37
</TABLE>
Source: Sales and Marketing, Demographics USA 1997
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<PAGE> 24
The Bank will be located in the West Shore Business District of Tampa. The
West Shore Business District is the geographic center of the Tampa Bay MSA and
is adjacent to the Tampa International Airport. The West Shore Business District
has more than 4,000 businesses and 70,000 employees according to the Economic
and Market Update of the Florida Research Group dated June 1998. It is located
within a ten to forty mile drive of the Tampa Bay MSA's ten largest residential
communities. Approximately 9.3 million square feet of office space, half of
Hillsborough county's office space, is in the West Shore Business District.
According to the Update, the success of this business district is based on its
geographically central location, its close proximity to the airport, the nearby
executive and employee housing, extensive retail amenities and its numerous
nearby hotel facilities.
The Bank will extend loans throughout the Tampa Bay MSA, but the
concentration will be in Hillsborough and Pinellas counties. The businesses in
the MSA will be served by the Bank's courier service. The organizers believe
that a business-oriented bank with a single office serving small and
intermediate-sized firms with loan needs of between $500,000 and $2.5 million
will fill a well-defined need in the area at this time.
COMPETITION
Competition among financial institutions in the Bank's primary market is
intense. As of December 31, 1997, there were 59 financial institutions in
Hillsborough and Pinellas Counties with deposits of $20.72 billion. Although
the deposits for both counties decreased from $20.95 billion at the end of
1996, a 1% decrease on an annualized basis, the deposits for banks in
Hillsborough County increased $380 million from December 31, 1996 through
December 31, 1997, an increase of 4.5% on an annualized basis. Further, during
the same time period, the independent banks in Hillsborough County experienced
an increase in deposits from $1.4 billion to $1.6 billion, an annual rate of
13.8%, while independent banks in Pinellas County also experienced an increase
in deposits from $2.2 billion to $2.5 billion or 14.0%.
Thus the independent banks in Hillsborough and Pinellas Counties increased
their overall market share from 17.0% to 19.1% of the deposit base. Independent
banks should have further increased their share of deposits in these counties
since the summer of 1998 because of large divestitures resulting from
Barnett-NationsBank merger. This region had the greatest overlap between the two
banks and the regulators have required substantial deposit divestitures by
NationsBank. A clear picture of the deposit mix between regional banks and
independent banks will not be available until the first quarter of 1999.
Financial institutions primarily compete with one another for deposits. In
turn, a bank's deposit base directly affects such bank's loan activities and
general growth. Primary methods of competition include interest rates on
deposits and loans, service charges on deposit accounts and the availability of
unique financial services products. The Bank will be competing with financial
institutions which have much greater financial resources than the Bank, and
which may be able to offer more services and possibly better terms to their
customers. The Organizers, however, believe that the Bank will be able to
attract sufficient deposits to enable the Bank to compete effectively with other
area financial institutions.
The Bank will be in competition with existing area financial institutions
other than commercial banks and thrift institutions, including insurance
companies, consumer finance companies, brokerage houses, credit unions and other
business entities which target traditional banking markets. Due to the growth of
the Tampa area, it can be anticipated that additional competition will continue
from existing institutions, as well, new entrants to the market.
The following tables provide details of the history of Bank and Thrift
(S&L) deposits in Hillsborough and Pinellas Counties:
[Tables to Follow This Page]
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<PAGE> 25
BANK AND S&L DEPOSITS - HILLSBOROUGH COUNTY
<TABLE>
<CAPTION>
1996 1997
REGIONAL BANKS #OFFICES $MILLIONS %COUNTY #OFFICES $MILLIONS %COUNTY
<S> <C> <C> <C> <C> <C> <C>
Barnett (36) $ 2,342.5 28.7% (35) $ 2,450.8 28.7%
First Union (18) 1,070.6 13.1% (18) 1,029.6 12.1%
Fortune/AmSou (4) 101.6 1.3% (7) 204.5 2.5%
Ft. Bro./Colonial (8) 185.5 2.3% (8) 189.9 2.2%
NationsBank (35) 1,694.9 20.8% (37) 1,634.0 19.2%
SouthTrust (8) 227.9 2.8% (8) 232.7 2.7%
SunTrust (23) 972.3 11.9% (23) 1,020.8 12.0%
Terrace/Villages/Regions (4) 171.1 1.2% (4) 190.8 2.3%
TOTAL (136) $ 6,766.4 83.0% (140) $ 6,953.1 81.5%
INDEPENDENT BANKS
Anchor/Beneficial (1) $ 8.0 .1% (1) $ 5.5 .0%
Bank of Tampa (5) 223.8 2.7% (5) 251.0 2.9%
Bay Financial (1) 102.2 1.5% (1) 124.2 1.5%
Carteret/Hamilton (1) 125.0 1.5% (1) 140.6 1.6%
Central Bank (4) 134.5 1.7% (5) 134.6 1.6%
City First (3) 61.0 .8% (3) 69.5 .8%
Columbia Bank (5) 56.0 .7% (5) 56.6 .7%
First of America (2) 9.2 .1% (2) 13.6 .1%
First Commercial (1) 37.5 .5% (1) 47.2 .6%
FNB Tampa (1) 45.9 .6% (1) 45.5 .5%
FNB Cent. Fla (7) 20.3 .3% (7) 21.1 .3%
Gulf West (2) 28.3 .4% (2) 32.2 .4%
Manufacturers (1) 90.9 1.1% (1) 124.8 1.5%
Northern Trust -- -- -- (1) 17.3 .2%
Northside (2) 44.8 .6% (2) 61.5 .7%
Partners (1) 33.1 .4% (1) 31.0 .4%
Provident (3) 36.7 .5% (3) 51.5 .5%
Southern Commerce (1) 46.5 .6% (1) 53.1 .6%
Southern Exchange (2) 80.7 1.0% (2) 73.4 .9%
Sunshine State (5) 103.4 1.3% (5) 104.5 1.2%
University/Terrace (2) 56.2 .7% (3) 65.3 .8%
Valrico State (1) 42.2 .5% (4) 55.2 .6%
TOTAL (51) $ 1,386.2 17.0% (57) $ 1,579.2 18.5%
TOTAL COUNTY (187) $ 8,152.6 100.0% (197) $ 8,532.3 100.0%
</TABLE>
Source: Florida Bankers Association
21
<PAGE> 26
BANK AND S&L DEPOSITS - PINELLAS COUNTY
<TABLE>
<CAPTION>
1996 1997
REGIONAL BANKS #OFFICE $MILLIONS %COUNT #OFFICE $MILLIONS %COUNT
<S> <C> <C> <C> <C> <C> <C>
AmSouth (30) $ 1,550.0 12.1% (29) $ 987.1 8.1%
Barnett (48) 2,828.1 22.1% (58) 2,779.1 22.8%
First Union (40) 2,336.6 18.2% (38) 2,257.9 18.5%
NationsBank (38) 2,001.0 15.6% (38) 1,846.6 15.1%
SouthTrust (21) 1,010.2 7.9% (19) 1,021.8 8.4%
SunTrust (17) 725.9 5.7% (17) 726.6 6.0%
World Federal (4) 179.2 1.4% (4) 97.2 .8%
TOTAL (198) $ 10,631.0 83.1% (203) $ 9,716.3 79.8%
INDEPENDENT BANKS
Anchor Savings (4) $ 142.9 1.1% (4) $ 142.7 1.2%
Bank of St. Petersburg (1) 29.0 .2% (1) 32.5 .3%
Citizens Bank & Trust (6) 86.8 .9% (6) 100.3 .8%
Crown FSB (1) 113.1 1.0% (1) 114.2 0.9%
First Central Bank (1) 44.6 .4% (1) 52.1 .4%
First State Bank (3) 36.7 .3% (3) 36.3 .3%
First of America (14) 178.9 1.4% (13) 134.6 1.1%
First Nationwide (3) 220.4 1.7% (3) 244.2 2.0%
Florida Bancgroup (2) 21.1 .2% (2) 26.7 .2%
Gulf West (6) 121.4 1.0% (7) 137.1 1.1%
Indian Rocks State (3) 61.6 .5% (3) 72.6 .6%
Invest Bank (4) 94.4 .7% (5) 132.4 1.1%
Madison Bank (2) 118.6 .9% (2) 117.4 1.0%
Marine Bank (1) 47.2 .4% (1) 45.9 .4%
Northern Trust (1) 34.5 .3% (1) 56.8 .5%
Peoples Bank (4) 68.0 .5% (4) 84.2 .7%
Pinellas Community (3) 77.5 .6% (3) 86.3 .7%
Republic Bancshares (20) 535.8 4.2% (20) 642.0 5.3%
Southern Exchange (2) 33.7 .3%
Tarpon Financial (1) 17.1 .1% (1) 16.8 .1%
United Bank & Trust (4) 108.4 .9% (4) 130.9 1.1%
Village Bank (1) 5.5 .0% (2) 14.7 .1%
TOTAL (85) $ 2,163.5 16.9% (89) $ 2,454.4 20.2%
TOTAL COUNTY (283) $ 12,794.5 100.0% (292) $ 100.0%
</TABLE>
Source: Florida Bankers Association
<PAGE> 27
BOARD OF DIRECTORS AND BOARD COMMITTEES
The Bank believes that its board is composed of high quality, knowledgeable
and proven business and banking professionals. Initially there will be 9 members
on the Bank's board of directors. Additional high quality directors may be added
when and as deemed necessary. In order to fulfill their responsibilities to the
customers and shareholders of the Bank, it is anticipated that the board of
directors will meet on a monthly basis, or more often as needed, to review the
operations of the Bank and provide appropriate direction to management.
It is anticipated that a more extensive oversight of particular aspects of
the Bank's operations will be conducted by committees of the board of directors.
These committees will consist of the Executive Committee, Executive Loan
Committee, Asset/Liability and Investment Committee, Audit Committee and
Compensation Committee.
The Executive Committee will be responsible for defining and implementing
the overall strategy and policies of the Bank. It will also be responsible for
monitoring the financial performance of the Bank. The committee will review and
recommend marketing plans, capital plans, major capital expenditures and bank
expansion plans.
The Executive Loan Committee will be responsible for ensuring the soundness
of the Bank's credit policy; conformance to lending policies and compliance with
applicable laws, rules and regulations. To fulfill these responsibilities, the
Executive Loan Committee will review the adequacy of the credit policy on at
least an annual basis, review all large loans and monitor the performance of the
loan portfolio on an ongoing basis.
The Asset/Liability and Investment Committee will be responsible for
ensuring the soundness of the Bank's investment policy and asset/liability
management policy; conformance to these policies and compliance with applicable
laws, rules and regulations. To fulfill these responsibilities, the committee
will review the adequacy of the investment and asset/liability management
policies on at least an annual basis. The committee will also monitor
performance of the investment portfolio, the Bank's liquidity position and the
interest rate sensitivity position.
The Audit Committee will consist solely of outside directors and will be
responsible for ensuring that an adequate audit program exists and that Bank
personnel are operating in conformance with all applicable laws, rules and
regulations. All auditors employed or engaged by the Bank will report directly
to the Audit Committee. The Audit Committee will recommend the selection of
auditors, review the audit program on at least an annual basis to ensure the
adequacy of its scope, and review all reports of auditors and examiners as well
as management's responses to such reports to ensure the effectiveness of
internal controls and the implementation of remedial action. The Audit committee
will also be responsible for the integrity of the internal loan review system.
The Compensation Committee will be responsible for ensuring that the
Bank's compensation policy is effectively meeting its objectives. Compensation
will be reviewed on an annual basis, or more frequently if necessary.
DEPOSITS
The Bank will offer a wide range of interest-bearing and
noninterest-bearing deposit accounts, including commercial and retail checking
accounts, money market accounts, individual retirement accounts, regular
interest-bearing statement savings accounts and certificates of deposit with
fixed and variable rates and a range of maturity date options. The sources of
deposits will be residents, businesses and employees of businesses within the
Bank's market area, obtained through the personal solicitation of the Bank's
officers and directors, direct mail solicitation and advertisements published in
the local media. The Bank intends to pay competitive interest rates on time and
savings deposits up to the maximum permitted by law or regulation. In addition,
the Bank will implement a service charge fee schedule competitive with other
financial institutions in the Bank's market area covering such matters as
maintenance fees on checking accounts, per item processing fees on checking
accounts and returned check charges.
LOAN PORTFOLIO
The Bank will provide for the financing needs of the community it serves by
offering a variety of loans. Commercial loans will include both collateralized
and uncollateralized loans for working capital (including inventory and
receivables), business expansion (including real estate acquisitions and
improvements), and purchase of equipment and machinery. The Bank will originate
a variety of residential real estate loans, including conventional mortgages
collateralized by first mortgage liens to enable borrowers to purchase,
refinance, construct upon or improve real property. Consumer loans will include
collateralized and uncollateralized loans for financing automobiles, boats, home
22
<PAGE> 28
improvements, and personal investments. The Bank will primarily enter into
lending arrangements for its portfolio loans with individuals who are familiar
to the Bank and are residents of the Bank's primary market and surrounding area.
It is anticipated that 20-25% of the loans will come from outside the Banks
market area.
The bank's commercial loans primarily will be underwritten in the Bank's
market area on the basis of the borrowers' ability to service such debt from
income. As a general practice, the Bank will take as collateral a security
interest in any available real estate, equipment, or other chattel. Such loans,
however, may also be made on an uncollateralized basis. Collateralized working
capital loans will be primarily collateralized by short term assets whereas term
loans will be primarily collateralized by long term assets.
Unlike residential mortgage loans, which generally are made on the basis of
the borrowers' ability to make repayment from his employment and other income,
and which are collateralized by real property whose value tends to be easily
ascertainable, commercial loans typically will be underwritten on the basis of
the borrower's ability to make repayment from the cash flow of the business and
generally will be collateralized by business assets, such as accounts
receivable, equipment and inventory.
A portion of the Bank's lending activities will consist of the origination
of single family residential mortgage loans collateralized by owner-occupied
property located in the Bank's market area and surrounding areas. The Bank will
also offer adjustable rate mortgages (ARMs) and will maintain these ARMs in its
portfolio or may sell the ARMs in the secondary market. The ability to retain
ARMs in the portfolio will allow the Bank the opportunity to originate loans to
borrowers who may not meet the underwriting criteria of strict secondary market
standards but are still quality credit risks.
Fixed and adjustable rate mortgage loans collateralized by single family
residential real estate generally will be generated in amounts of no more than
85% of appraised value. The Bank may, however, lend up to 95% of the value of
the property collateralizing the loan, but if such loans are required to be made
in excess of 85% of the value of the property, they must be insured by private
or federally guaranteed mortgage insurance. In the case of mortgage loans, the
Bank will require mortgagees title insurance to protect against defects in its
lien on the property which may collateralize the loan. The Bank in most cases
will require title, fire and extended casualty insurance to be obtained by the
borrower. Where required by applicable regulations, the bank will also require
flood insurance. The Bank will maintain its own errors and omissions insurance
policy to protect against loss in the event of failure of a mortgagor to pay
premiums on fire and other hazard insurance policies.
The Bank will originate residential construction loans to contractors to
finance the construction of single family dwellings, but most of the residential
construction loans will be made to individuals who intend to erect
owner-occupied housing on a purchased parcel of real estate. The Bank's
construction loans to individuals will typically range in size from $50,000 to
$200,000. Construction loans to contractors will be generally offered on the
same basis as other residential real estate loans except that a larger
percentage down payment will typically be required.
The Bank will finance the construction of individual, owner-occupied houses
on the basis of written underwriting and construction loan management
guidelines. Construction loans will be structured either to be converted to
permanent loans with the Bank at the end of the construction phase or to be paid
off upon receiving financing from another financial institution. Construction
loans on residential properties will be generally made in amounts up to 95%
(along with mortgage insurance) of appraised value. Construction loans to
contractors will generally have terms of up to 12 months. The maximum loan
amounts for construction loans will be based on the lessor of the current
appraised value or the purchase price.
Consumer loans made by the Bank will include the financing of automobiles,
recreation vehicles, boats, second mortgages, home improvement loans, home
equity lines of credit, personal (collateralized and uncollateralized) and
deposit account collateralized loans. Consumer loans will be made at fixed and
variable interest rates and may be made based on up to a 10-year amortization
schedule but which become due and payable in full and are generally refinanced
in 36 to 60 months. Consumer loans will be attractive to the Bank because they
typically have a shorter term and carry higher interest rates than that charged
on other types of loans.
The Bank recognizes that credit losses will be experienced and the risk of
loss will vary with, among other things, the type of loan being made, the
creditworthiness of the borrower over the term of the loan and, in the case of
a collateralized loan, the quality of the collateral for the loan as well as the
general economic conditions. Management will maintain an adequate allowance for
loan losses based on, among other things, industry standards, management's
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experience, the Bank's historical loan loss experience, evaluation of economic
conditions and regular reviews of delinquencies and loan portfolio quality.
The Bank intends to follow a conservative lending policy, but one which
permits prudent risks to assist businesses and consumers in the market area. The
lending area is expected to be generally the immediate Hillsborough County and
the counties contiguous to Hillsborough County. It is not expected that loan
participations will be purchased from correspondent banks. However,
participations will likely be sold, particularly with regard to real estate
lending. Interest rates will vary depending on the cost of funds to the Bank,
the loan maturity, and the degree of risk. Whenever possible, interest rates
will be adjustable with fluctuations in the "prime" rate. The long-term target
loan-to-deposit ratio will be approximately seventy-five (75%) percent. This
ratio is expected to meet the credit needs of customers while allowing prudent
liquidity through the investment portfolio. The Directors believe that this
positive, community-oriented lending philosophy will be translated into a
sustainable volume of quality loans into the foreseeable future.
Loan quality will be enhanced through the staffing of the Bank with
experienced, well-trained lending officers capable of soliciting loan business.
The officers will also have the ability to recognize and appreciate the
importance of exercising care and good judgment in underwriting loans, thus
insuring the safety and profitability of the Bank.
OTHER PRODUCTS AND SERVICES
COURIER SERVICES. The Bank intends to offer a courier service to its
commercial customers. This service, which will either be provided directly or
through a third party, will allow the Bank to deliver convenience through the
scheduled pickup of deposits.
TELEPHONE AND PC BANKING. The Bank believes there is strong demand within
the market for telephone and PC banking. These services allow customers to
access account information, execute certain transactions and pay invoices
electronically. Both of these services will be provided through a third-party
vendor.
AUTOMATIC TELLER MACHINES ("ATMS"). The Bank does not intend to establish
an ATM network, as it believes its capital can be more efficiently deployed
elsewhere. However, the Bank does intend to make certain existing ATM networks
available to its customers and to offer customers a certain number of free
transactions each month.
The Bank intends to continually evaluate other financial services such as
trust services, insurance services, investment services, brokerage services and
all other permissible activities.
INVESTMENTS
The Bank's primary objective will be to construct an investment portfolio
comprised of a mixture of investments which will earn an acceptable rate of
return while meeting the liquidity requirements of the Bank. This will be
accomplished by matching the maturity of assets with liabilities to the greatest
extent possible.
The Bank intends to invest primarily in U.S. obligations guaranteed as to
principal and interest. The Bank will also enter into federal funds transactions
with its principal correspondent banks and anticipates that it will be a net
seller of funds. All investments with a maturity in excess of one year will be
readily salable on the open market.
ASSET/LIABILITY MANAGEMENT
It will be the objective of the Bank to manage assets and liabilities to
provide a satisfactory, consistent level of profitability within the framework
of established cash management, loan, investment, borrowing and capital
policies. Designated Officers of the Bank will be responsible for monitoring
policies and procedures that are designed to ensure acceptable composition of
the asset-liability mix, stability and leverage of all sources of funds while
adhering to prudent banking practices. It is the overall philosophy of
management to support asset growth primarily through growth of core deposits,
which include deposits of all categories made by individuals, partnerships and
corporations. Management of the Bank will seek to invest the largest portion of
the Bank's assets in commercial, consumer and real estate loans. The Bank's
asset/liability mix will likely be monitored on a daily basis with a monthly
report reflecting interest-sensitive assets and interest-sensitive liabilities
being prepared and presented to the Bank's board of directors. The objective of
this policy is to control interest-sensitive assets and liabilities so as to
minimize the impact of substantial movements in interest rates on the Bank's
earnings.
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CORRESPONDENT BANKING
The Bank intends to purchase certain services from correspondent bank. Such
services are available on a statewide or regional basis from commercial banks,
banker's banks, the Federal Reserve Bank of Atlanta and the Atlanta Federal Home
Loan Bank. The Bank will determine the availability of such services and
evaluate the quality and pricing of the services available and based upon the
above will select one or more providers for the services the Bank will require.
The Bank will then purchase from time to time, correspondent services offered by
such banks, including some of the following: check collections, purchase or sale
of Federal Funds, security safekeeping, investment services, coin and currency
supplies, overline and liquidity loan participations and sales of loans to or
participations with correspondent banks.
The Bank anticipates that it will sell loan participations to
correspondent banks with respect to loans which exceed the Bank's lending
limit. As compensation for services provided by a correspondent, the Bank may
maintain certain balances with such correspondents in non-interest bearing
accounts, or may elect to pay for such fees directly.
DATA PROCESSING
The Bank has entered into a data processing servicing agreement with an
outside service bureau, M&I Data Services. This servicing agreement provides for
the Bank to receive a full range of data processing services, including an
automated general ledger, deposit accounting, commercial, real estate and
installment loan processing, payroll, central information file and ATM
processing and investment portfolio accounting. The servicing agreement is for a
term of seven years with an option for the Bank to renew for an additional term
of one year. The servicing agreement provides for installation and set up,
limited training, and consultation services necessary for the Bank to commence
using the data processing services, as well as a license to use the computer
software necessary for the services. The initial cost to the Bank for these
items will be $132,150. Thereafter, the Bank will be charged $8,000 per month
plus fees for certain services, as used. It is estimated that the total monthly
fees will be approximately $12,000.
STAFFING
It is the goal of the Bank to maintain a competently trained staff of local
bankers. A primary complaint about large regional banks is the constant turnover
of personnel. This prevents building long-term personal relationships with local
customers. The Bank intends to employ competent individuals who are already
living in the community or who commit to live in the community on a permanent
basis.
Management recognizes that the success of the Bank is directly related to
the people it is able to attract and maintain as employees. The Bank recognizes
that such employees deserve to share in that success. There will be numerous
opportunities for advancement resulting from the Bank's projected growth, and
personnel will be encouraged to enroll in various banking courses and other
seminars to improve their overall knowledge.
The Bank intends to commence operations with a staff of fewer than 15
full-time equivalent employees. Management anticipates that the Bank will
increase its staff to 21 full-time equivalent employees during the second year
of operation in order to provide for anticipated growth.
MONETARY POLICIES
The results of operations of the Bank will be affected by credit policies
of monetary authorities, particularly the Federal Reserve. The instruments of
monetary policy employed by the Federal Reserve include open market operations
in U.S. Government securities, changes in the discount rate on member bank
borrowings, changes in reserve requirements against member bank deposits and
limitations on interest rates which member banks may pay on time and savings
deposits. In view of changing conditions in the national economy and in the
money markets, as well as the effect of action by monetary and fiscal
authorities, including the Federal Reserve, no accurate prediction can be made
as to possible future changes in interest rates, deposit levels, loan demand or
the business and earnings of the Bank.
REGULATION AND SUPERVISION
GENERAL
As a one-bank holding company registered under the BHC Act, the Company
will be subject to regulation and supervision by the Federal Reserve. Under the
BHC Act, the Company's activities and those of its Bank subsidiary are limited
to banking, managing or controlling banks, furnishing services to or performing
services for its subsidiaries or engaging in any other activity that the Federal
Reserve determines to be so closely related to banking or managing or
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controlling banks as to be a proper incident thereto. As a state-chartered
commercial bank, the Bank will be subject to extensive regulation by the Florida
Department of Banking and Finance ("Department") and the FDIC.
The Company and the Bank will be required to file reports with the Federal
Reserve, the Department and the FDIC concerning their activities and financial
condition, in addition to obtaining regulatory approvals prior to entering into
certain transactions such as mergers with or acquisitions of other financial
institutions. Periodic examinations are performed by the Federal Reserve, the
Department and the FDIC to monitor the Company's and the Bank's compliance with
the various regulatory requirements. The Bank's deposits will be insured up to
the applicable limits by the FDIC under the Bank Insurance Fund ("BIF"). The
Bank will be subject to regulation by the Federal Reserve and the Department
with respect to reserves required to be maintained against transaction deposit
accounts and certain other matters.
REGULATION OF THE COMPANY
GENERAL. The BHC Act prohibits the Company from acquiring direct or
indirect control of more than 5% of any class of outstanding voting stock or
acquiring substantially all of the assets of any bank or merging or
consolidating with another bank holding company without prior approval of the
Federal Reserve. The BHC Act also prohibits the Company from acquiring control
of any bank operating outside the State of Florida, unless such action is
specifically authorized by the statutes of the state where the bank to be
acquired is located. Additionally, the BHC Act prohibits the Company from
engaging in or from acquiring ownership or control of more than 5% of the
outstanding voting stock of any company engaged in a non-banking business,
unless such business is determined by the Federal Reserve to be so closely
related to banking or managing or controlling banks as to be properly incident
thereto. The BHC Act generally does not place territorial restrictions on the
activities of such non-banking related activities.
TRANSACTIONS BETWEEN THE COMPANY AND THE BANK. The Company's authority to
engage in transactions with related parties or "affiliates," or to make loans to
certain insiders, is limited by certain provisions of the Financial Institutions
Reform, Recovery and Enforcement Act of 1989 ("FIRREA"). Specifically, Sections
23A and 23B of the Federal Reserve Act apply to all transactions by an
insured-state nonmember bank or a holding company with any affiliate. Sections
23A and 23B generally define an "affiliate" as any company that controls or is
under common control with an institution. Subsidiaries of a financial
institution, however, are generally exempted from the definition of "affiliate."
Section 23A limits the aggregate amount of transactions with any individual
affiliate to 10% of the capital and surplus of the Company and also limits the
aggregate amount of transactions with all affiliates to 20% of the Company's
capital and surplus. Certain transactions with affiliates, such as loans to
affiliates or guarantees, acceptances and letters of credit issued on behalf of
affiliates, are required to be collateralized by collateral in an amount and of
a type described in the statute. The purchase of low quality assets from
affiliates is generally prohibited. Section 23B provides that certain
transactions with affiliates, including loans and asset purchases, must be on
terms and under circumstances, including credit standards, that are
substantially the same or at least as favorable to the institution as those
prevailing at the time for comparable transactions with nonaffiliated companies.
In the absence of comparable transactions, such transactions may only occur
under terms and circumstances, including credit standards, that in good faith
would be offered to or would apply to nonaffiliated companies. The Company does
not expect these provisions will have any effect on its proposed operations.
SUPPORT OF SUBSIDIARY DEPOSITORY INSTITUTIONS. In accordance with Federal
Reserve policy, the Company is expected to act as a source of financial strength
and to commit resources to support the Bank. This support may be required at
times when the Company might not be inclined to provide such support. Such
support would include the infusion of additional capital into an under
capitalized bank subsidiary in situations where an additional investment in a
troubled bank might not ordinarily be made by a prudent investor. In addition,
any capital loans by a bank holding company to any of its subsidiary banks must
be subordinate in right of payment to deposits and to certain other indebtedness
of such subsidiary banks. In the event of bankruptcy, any commitment by a bank
holding company to a federal bank regulatory agency to maintain the capital of
its subsidiary bank will be assumed by the bankruptcy trustee and will be
entitled to a priority of payment.
Under the Federal Deposit Insurance Act ("FDIA") a subsidiary bank of a
bank holding company, can be held liable for any loss incurred by, or reasonably
expected to be incurred by the FDIC in connection with (i) the default of a
commonly controlled FDIC-insured depository institution or (ii) any assistance
provided by the FDIC to any commonly controlled FDIC insured depository
institution "in danger of default." "Default" is defined generally as the
appointment of a conservator or a receiver and "in danger of default" is defined
generally as the existence of certain conditions indicating that a default is
likely to occur in the absence of regulatory assistance.
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CONTROL OF A BANK HOLDING COMPANY. FRB Regulation Y, adopted pursuant to
Section 225.41 of 12 U.S.C. Section 1817(j), requires persons acting directly or
indirectly or in concert with one or more persons to give the Board of Governors
of the Federal Reserve 60 days advanced written notice before acquiring control
of a bank holding company. Under the Regulation, control is defined as the
ownership or control with the power to vote 25 % or more of any class of voting
securities of the Holding Company. The Regulation also provides for a
presumption of control if a person owns, controls, or holds with the power to
vote 10 % or more (but less than 25 %) of any class of voting securities, and
if: (i) the Holding Company's securities are registered securities under Section
12 of the Securities Exchange Act of 1934; or (ii) no other person owns a
greater percentage of that class of voting securities. It is not anticipated
that any purchaser of the securities offered herein, including any of the
Organizers, will acquire 10% of more of the Company's Common Stock.
LEGISLATION AND REGULATIONS OF THE BANK
GENERAL. From time to time, various bills are introduced in the United
States Congress with respect to the regulation of financial institutions. Recent
banking legislation, particularly the FIRREA and the Federal Deposit Insurance
Corporation Improvement Act of 1991 ("FDICIA"), has broadened the regulatory
powers of the federal bank regulatory agencies and restructured the nation's
banking system. The following is a brief discussion of certain portions of these
laws and how they would affect the Company or the Bank.
The FDICIA revised sections of the FDIA affecting bank regulation, deposit
insurance and provisions for funding of the BIF administered by the FDIC. The
FDICIA also revised bank regulatory structures embodied in several other federal
banking statutes, strengthened the bank regulators' authority to intervene in
cases of deterioration of a bank's capital level, placed limits on real estate
lending and imposes detailed audit requirements.
PROMPT AND CORRECTIVE ACTION. The FDICIA required the federal banking
regulatory agencies to set certain capital and other criteria which would define
the category under which a particular financial institution would be classified.
The FDICIA imposes progressively more restrictive constraints on operations,
management, and capital distributions depending on the category in which an
institution is classified. Pursuant to the FDICIA, undercapitalized institutions
must submit recapitalization plans to their respective federal banking
regulatory agencies, and a company controlling a failing institution must
guarantee such institution's compliance with its plan in order for the plan to
be accepted.
The FDIC's prompt and corrective action regulations define, among other
things, the relevant capital measures for the five capital categories. For
example, a bank is deemed to be "well-capitalized" if it has a total risk-based
capital ratio (total capital to risk-weighted assets) of 10% or greater, a Tier
1 risk-based capital ratio (Tier 1 capital to risk-weighted assets) of 6% or
greater, and a Tier 1 leverage capital ratio (Tier 1 capital to adjusted total
assets) of 5% or greater, and is not subject to a regulatory order, agreement or
directive to meet and maintain a specific capital level for any capital measure.
A bank is deemed to be "adequately capitalized" if it has a total risk-based
capital ratio of 8% or greater, and (generally) a Tier 1 leverage capital ratio
of 4% or greater, and the bank does not meet the definition of a
"well-capitalized" institution. A bank is deemed to be "critically
undercapitalized" if it has a ratio of tangible equity (as defined in the
regulations) to total assets that is equal to or less than 2%. In addition, the
FDIC is authorized effectively to downgrade a bank to a lower capital category
than the bank's capital ratios would otherwise indicate, based upon safety and
soundness considerations (such as when the bank has received a less than
satisfactory examination rating for any of the CAMELS rating categories other
than capital: i.e. Asset Quality, Management, Earnings or Liquidity). As a bank
drops to lower capital levels, the extent of action to be taken by the
appropriate regulator increases, restricting the types of transactions in which
the bank may engage. The new capital standards are designed to bolster and
protect the deposit insurance fund. Based upon its proposed capital, the Bank
would be considered to be well capitalized.
INSURANCE ON DEPOSIT ACCOUNTS. In response to the requirements of the
FDICIA, the FDIC established a risk-based assessment system for insured
depository institutions that takes into account the risks attributable to
different categories and concentrations of assets and liabilities. The FDIC
assigns a financial institution to one of three capital categories based on the
institution's financial information, as of the reporting period ending seven
months before the assessment period. These categories consist of well
capitalized, adequately capitalized or undercapitalized, and one of three
supervisory subcategories within each capital group. The supervisory subgroup to
which an institution is assigned is based on a supervisory evaluation provided
to the FDIC by the financial institution's primary regulator, in the Bank's case
the Department, and information which the FDIC determines to be relevant to the
institution's financial condition and the risk posed to the deposit insurance
funds. A financial institution's assessment rate depends on the capital
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category and supervisory category to which it is assigned. There are nine
assessment risk classifications (i.e., combinations of capital groups and
supervisory subgroups) to which different assessment rates are applied. BIF
assessment rates range from 0 basis points on deposits for a financial
institution in the highest category (i.e.. well-capitalized and financially
sound with only a few minor weaknesses) to 31 basis points on deposits for an
institution in the lowest category (i.e., undercapitalized and posing a
substantial probability of loss to the BIF, unless effective corrective action
is taken). The Bank does not expect any assessment for its first year of
operation.
STANDARDS FOR SAFETY AND SOUNDNESS. The FDICIA requires each federal
banking agency to prescribe for all insured depository institutions and their
holding companies standards relating to internal controls, information systems
and audit systems, loan documentation, credit underwriting, interest rate risk
exposure, asset growth, compensation, fees and benefits and such other
operational and managerial standards as the agency deems appropriate. In
addition, the federal banking regulatory agencies are required to prescribe by
regulation standards specifying: (i) maximum classified assets to capital
ratios; (ii) minimum earnings sufficient to absorb losses without impairing
capital; (iii) to the extent feasible, a minimum ratio of market value to book
value for publicly traded shares of depository institutions or the depository
institution holding companies; and (iv) such other standards relating to asset
quality, earnings and valuation as the agency deems appropriate. Finally, each
federal banking agency is required to prescribe standards for employment
contracts and other compensation arrangements of executive officers, employees,
directors and principal shareholders of insured depository institutions that
would prohibit compensation and benefits and other arrangements that are
excessive or that could lead to a material financial loss for the institution.
If an insured depository institution or its holding company fails to meet any of
its standards described above, it will be required to submit to the appropriate
federal banking agency a plan specifying the steps that will be taken to cure
the deficiency. If an institution fails to submit an acceptable plan or fails to
implement the plan, the appropriate federal banking agency will require the
institution or holding company, to correct the deficiency and until corrected,
may impose restrictions on the institution or the holding company including any
of the restrictions applicable under the prompt corrective action provisions of
the FDICIA.
The FDICIA also requires each appropriate federal banking agency to adopt
uniform regulations prescribing standards for extensions of credit secured by
real estate or made for the purpose of financing the construction of
improvements on real estate. In prescribing these standards, the banking
agencies must consider the risk posed to the deposit insurance funds by real
estate loans, the need for safe and sound operation of insured depository
institutions and the availability of credit.
CAPITAL REQUIREMENTS. The Federal Reserve and the FDIC have adopted capital
regulations which establishes a Tier 1 core capital definition and a minimum 3%
leverage capital ratio requirement for the most highly-rated banks and holding
companies (i.e., those banks and holding companies with a composite CAMELS
rating of 1 under the Uniform Financial Institutions Rating System established
by the Federal Financial Institutions Examination Council) that are not
anticipating or experiencing significant growth. All other state nonmember banks
are required to meet a minimum leverage ratio that is at least 100 to 200 basis
points above 3%. A holding company or bank that is not in the highest-rated
category or that is anticipating or experiencing significant growth will have to
meet a minimum leverage ratio of at least 4%. The minimum capital with which the
Bank will be permitted to open is $6 million.
Under the Federal Reserve's and the FDIC's risk-based regulations, a
holding company or bank must classify its assets and certain off-balance sheet
activities into categories and maintain specified levels of capital for each
category. The least capital is required for the category deemed by the Federal
Reserve and the FDIC to have the least risk, and the most capital is required
for the category deemed by the Federal Reserve and the FDIC to have the greatest
risk. The regulations require a holding company or bank to have a total risk
based capital ratio of 8% and a Tier 1 risk based capital ratio of 4%. Under the
statement of policy, certain assets are required to be deducted from risk-based
capital. Such assets include intangible assets, unconsolidated banking and
finance subsidiaries, investments in securities subsidiaries, ineligible equity
investments and reciprocal holding of capital instruments with other banks. In
addition, the Federal Reserve or the FDIC may consider deducting other assets on
a case-by-case basis or investments in other subsidiaries on a case-by-case
basis or based on the general characteristics or functional nature of the
subsidiaries.
LOANS TO ONE BORROWER. Florida law allows a state bank to extend credit to
any one borrower in an amount up to 25% of its capital accounts, which are
defined as unimpaired capital, surplus and undivided profits, provided that the
unsecured portion may not exceed 15% of the capital accounts of the bank. The
law permits exemptions for loans collateralized by accounts maintained with the
Bank and for loans guaranteed by the Small Business Administration, the Federal
Housing Administration and the Veterans Administration. The Bank will be subject
to these limits.
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PAYMENT OF DIVIDENDS. While not the only source of income, the primary
source of income to the Company will be dividends from the Bank. A Florida
chartered commercial bank may not pay cash dividends that would cause the bank's
capital to fall below the minimum amount required by federal or Florida law.
Otherwise, a commercial bank may pay a dividend out of the total of current net
profits plus retained net profits of the preceding two years to the extent it
deems expedient, except as described below. Twenty percent of the net profits in
the preceding two year period may not be paid in dividends, but must be retained
to increase capital surplus until such surplus equals the amount of common and
preferred stock issued and outstanding. In addition, no bank may pay a dividend
at any time that net income in the current year when combined with retained net
income from the preceding two years produces a loss. The ability of the Bank to
pay dividends to the Company will depend in part on the FDIC capital
requirements in effect at such time and the ability of the Bank to comply with
such requirements.
BROKERED DEPOSITS. In accordance with the FDICIA, the FDIC has implemented
restrictions on the acceptance of brokered deposits. In general, an
"undercapitalized" institution may not accept, renew or roll over any brokered
deposits. "Adequately capitalized" institutions may request a waiver from the
FDIC to do so, while "well-capitalized" institutions may accept, renew or roll
over such deposits without restriction. The rule requires registration of
deposit brokers and imposes certain recordkeeping requirements. Institutions
that are not "well-capitalized" (even if meeting minimum capital requirements)
are subject to limits on rates of interest they may pay on brokered and other
deposits. The Bank does not expect to acquire any brokered deposits.
LIQUIDITY. A state-chartered commercial bank is required under Florida law
to maintain a liquidity reserve of at least 15% of its total transaction
accounts and 8% of its total nontransaction accounts subject to certain
restrictions. This reserve may consist of cash-on-hand, demand deposits due from
correspondent banks, and other investments and short-term marketable securities.
The Bank will be subject to these requirements.
COMMUNITY REINVESTMENT. Under the Community Reinvestment Act ("CRA"), as
implemented by Federal Reserve and FDIC regulations, holding companies and state
nonmember banks have a continuing and affirmative obligation consistent with
their safe and sound operation to help meet the credit needs of their entire
community, including low- and moderate-income neighborhoods. The CRA does not
establish specific lending requirements or programs for financial institutions
nor does it limit an institution's discretion to develop the types of products
and services that it believes are best suited to its particular community,
consistent with the CRA. The CRA requires the Federal Reserve and the FDIC, in
connection with their examination of holding companies or state nonmember banks,
to assess the Company's record of meeting the credit needs of their communities
and to take such record into account in its evaluation of certain applications
by such institution. The FIRREA amended the CRA to require public disclosure of
an institution's CRA rating and to require that the Federal Reserve and the FDIC
provide a written evaluation of an institution's CRA performance utilizing a
four-tiered descriptive rating system in lieu of the then existing five-tiered
numerical rating system. The Company and the Bank will be subject to these
regulations.
DEPOSIT INSURANCE FUNDS ACT OF 1996. On September 30, 1996, Congress passed
and the President signed in to law the Deposit Insurance Funds Act of 1996
("DIFA"). Among other things, the DIFA, and rules promulgated thereunder by the
FDIC, provide for banks and thrifts to share the annual interest expense for the
Finance Corp. Bonds which were issued in the late 1980s to help pay the costs of
the savings and loan industry restructuring. The approximate annual interest
expense is $780 million of which BIF insured banks are expected to pay
approximately $322 million or 41%, while SAIF insured thrifts will pay
approximately $458 million or 59% of the interest expense. It is estimated that
the annual assessment for BIF insured institutions will be approximately 1.2
cents per $100 of deposits, while SAIF insured institutions will pay 6.5 cents
per $100 of deposits. These payments are to begin in 1997 and run through 1999.
Beginning in the year 2000 and continuing through the year 2017, banks and
thrifts will each pay 2.43 cents per $100 of deposits. These assessments will be
in addition to any regular deposit insurance assessments imposed by the FDIC
under FDICIA. See REGULATION AND SUPERVISION - Insurance on Deposit Accounts.
INTERSTATE BANKING. Under the Riegle-Neal Interstate Banking and Branching
Efficiency Act of 1994, existing restrictions on interstate acquisitions of
banks by bank holding companies were repealed on September 29, 1995, such that
the Company and any other bank holding company would be able to acquire any
Florida-based bank, subject to certain deposit percentage and other
restrictions. The legislation also provides that, unless an individual state
elects beforehand either (i) to accelerate the effective date or (ii) to
prohibit out-of-state banks from operating interstate branches within its
territory, on or after June 1, 1997, adequately capitalized and managed bank
holding companies will be able to consolidate. De novo branching by an
out-of-state bank would be permitted only if it is expressly permitted by the
laws of the host state. The authority of a bank to establish and operate
branches within a state will continue to
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be subject to applicable state branching laws. Florida has adopted legislation
which will permit interstate acquisitions and interstate branching effective
June 1, 1997. Florida law prohibits de novo branching by out of state banks.
DEPARTMENT ASSESSMENT. State-chartered commercial banks are required by
Department regulation to pay assessments to the Department to fund the
operations of the Department. The general assessment, to be paid semiannually,
is computed upon a bank's total assets, including consolidated subsidiaries, as
reported in the bank's latest quarterly call report. The Bank will be required
to pay such assessments semi-annually.
THE FEDERAL RESERVE SYSTEM
The Federal Reserve regulations require banks to maintain non
interest-earning reserves against their transaction accounts (primarily NOW and
regular checking accounts). The Federal Reserve regulations generally require
that reserves of 3% must be maintained against aggregate transaction accounts of
$49.3 million or less (subject to adjustment by the Federal Reserve) plus 10%
(subject to adjustment by the Federal Reserve between 8% and 14%) against that
portion of total transaction accounts in excess of $49.3 million. The first $4.4
million of otherwise reservable balances (subject to adjustments by the Federal
Reserve) are exempted from the reserve requirements. The balances maintained to
meet the reserve requirements imposed by the Federal Reserve may be used to
satisfy liquidity requirements. Because required reserves must be maintained in
the form of either vault cash, a noninterest-bearing account at a Federal
Reserve Bank or a pass-through account as defined by the Federal Reserve,
interest-earning assets of the Bank are reduced. The Company and the Bank will
be subject to these requirements.
ORGANIZERS AND PRINCIPAL SHAREHOLDERS
The following persons are Organizers of the Company: John C. Bierley,
Monroe E. Berkman, Troy A. Brown, Jr., Frank G. Cisneros, Lawrence H. Dimmitt,
III, Timothy A. McGuire, Eric M. Newman, Chris A. Peifer, and A. Bronson Thayer.
The Organizers, as a group, intend to subscribe for 305,000 Units in the
Offering which will equal 43.57% of the 700,000 minimum Units required to be
sold in order to release funds from the Subscription Escrow Agreement. In
addition to the subscriptions committed to by the Organizers, the Organizers
have indicated that they may be willing to subscribe for up to an additional 10%
of the Units sold in the Offering. In any event, total purchases by the
Organizers will not exceed 335,500 Units in the aggregate, which would equal
47.93% of the 700,000 minimum Units required to be sold in order to release
funds from the Subscription Escrow Account.
Mr. Timothy A. McGuire will be granted, at no cost to him, incentive stock
options to purchase a minimum of 34,444 shares of the Company's common stock.
Mr. McGuire may also be granted additional options under the Incentive Plans.
All such options will have a minimum exercise price of $10.00 per share,
exercisable at any time after the applicable vesting period, for ten years from
the date of grant. See "MANAGEMENT - Executive Compensation."
In order to provide funds for the payment of initial organizational and
pre-opening expenses, the Organizers initially advanced $90,000 to the Company.
The Company's obligation to repay these advances to the Organizers have been
extinguished in exchange for the issuance of 900 shares of redeemable preferred
stock from the Company at a price of $100 per share. The Company has issued an
additional 3,000 shares of redeemable preferred stock to organizers at a price
of $100,000 per share. The preferred stock is redeemable by the Company for the
purchase price at any time after the release of funds by the escrow agent and
will not mandate the payment of any dividend, but will have a distribution
preference above common stock in the event of a dissolution of the Company. The
preferred stock pays a dividend at the sole discretion of the Company. The
Company intends to declare a dividend of 2% of the purchase price of the
preferred stock within 30 days of the closing of the Offering.
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<PAGE> 36
Each of the Organizers intend to purchase the number of Units set forth in
the following Table. The table also specifies the percentage of Common Stock to
be owned by the Organizers after completion of the Offering Period including the
shares to be acquired by exercise of warrants and options.
<TABLE>
<CAPTION>
MINIMUM
NUMBER OF
BENEFICIAL PERCENT OF
NAME OF BENEFICIAL OWNER NUMBER OF SHARES(1) SHARES(2) MINIMUM(3) PERCENT OF MAXIMUM(4)
- ------------------------ ------------------- ---------- ---------- ---------------------
<S> <C> <C> <C> <C>
Monroe E. Berkman 50,000 107,694 14.21% 6.91%
John C. Bierley 40,000 87,694 11.73% 5.67%
Troy A. Brown, Jr. 30,000 67,694 9.18% 4.40%
Frank G. Cisneros 50,000 107,694 14.21% 6.91%
Lawrence H. Dimmitt, III 30,000 67,694 9.18% 4.40%
Timothy A. McGuire 10,000 54,444 7.31% 3.53%
Eric M. Newman 25,000 57,694 7.87% 3.76%
Chris A. Peifer 20,000 47,694 6.55% 3.12%
A. Bronson Thayer 50,000 107,694 14.21% 6.91%
------- ------- --------- -----
TOTAL(5) 305,000 705,996 64.12%(5) 37.14%(6)
======= ======= ========= =====
</TABLE>
- ------------
(1) Number of Shares to be purchased in the Offering.
(2) Includes shares purchased, as well as Warrants for the Shares to be issued
in connection with the proposed purchase, as well as the proposed options
pursuant to the Directors' Stock Option Plan and the Incentive Stock Option
Plan.
(3) Individual minimum percentages based upon 700,000 Shares outstanding, plus
individual Warrants for the Shares to be issued in connection with the
proposed purchase, as well as individual proposed options pursuant to the
Directors' Stock Option Plan and the Incentive Stock Option Plan.
(4) Individual maximum percentages based upon 1,500,000 Shares outstanding,
plus individual Warrants for the Shares to be issued in connection with the
proposed purchase, as well as individual proposed options pursuant to the
Directors' Stock Option Plan and the Incentive Stock Option Plan.
(5) Total minimum percentage based upon 700,000 Shares outstanding, plus all
Warrants to be acquired by Organizers and all Shares under the proposed
Directors' Stock Option Plan and the Incentive Stock Option Plan. No
assurances can be given that any Warrants will be exercised, and therefore,
that any of the 700,000 Shares will ever be issued.
(6) Total maximum percentage based upon 1,500,000 Shares outstanding, plus all
Warrants to be acquired by Organizers and all Shares under the proposed
Directors' Stock Option Plan and the Incentive Stock Option Plan. No
assurances can be given that any Warrants will be exercised, and therefore,
that any of the 1,500,000 Shares will ever be issued.
Each of the Organizers will acquire their Units during the Offering Period
and, therefore, will acquire both Common Stock and Warrants exercisable in
accordance with the terms set forth herein. While there can be no assurance that
the Organizers will exercise their Warrant rights, it can be assumed that most
or all will exercise such rights and will therefore acquire additional Common
Stock during the 36-month period following the Effective Date of registration.
See, "RISK FACTORS, Possible Dilution Resulting From Warrants."
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<PAGE> 37
MANAGEMENT
DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY AND THE BANK
The proposed directors and executive officers for the Company and the Bank
are as follows:
<TABLE>
<CAPTION>
NAME POSITION WITH COMPANY POSITION WITH BANK
---- --------------------- ------------------
<S> <C> <C>
Monroe E. Berkman Director Director
John E. Bierley Director Director
Troy A. Brown, Jr. Director Director
Frank G. Cisneros Director --
Lawrence H. Dimmitt, III Director Director
Timothy A. McGuire President President and CEO
Eric M. Newman Director Director
Chris A. Peifer Director Director
A. Bronson Thayer Chairman and CEO Chairman
</TABLE>
COMPANY. Each of the above persons has been a director of the Company or
the Bank since July 1, 1998. The initial Board of Directors of the Company
consists of nine directors. The directors will be divided into three classes,
designated Class I, Class II and Class III. Each class will consist, as nearly
as may be possible, of one-third of the total number of directors constituting
the entire Board of Directors. The term of the Company's initial directors will
expire at the first meeting of shareholders at which directors are elected. It
is expected that the Company will hold an organizational meeting of the
shareholders shortly after the Bank commences operations at which time the
shareholders will be asked to elect Directors. Following the subsequent election
of the Company's directors, the term of the Company's Class I directors will
expire at the Company's next annual meeting of shareholders; the term of the
Company's Class II directors will expire at the Company's second annual meeting
of shareholders; and the term of the Company's Class III directors will expire
at the Company's third annual meeting of shareholders. At each annual meeting of
shareholders, successors to the class of directors whose term expires at the
annual meeting will be elected for a three-year term. If the number of directors
is changed, an increase or decrease will be apportioned among the classes so as
to maintain the number of directors in each class as nearly equal as possible,
and any additional director of any class elected to fill a vacancy resulting
from an increase in such class will hold office for a term that will coincide
with the remaining term of that class, but in no event will a decrease in the
number of directors shorten the term of any incumbent director. Any director
elected to fill a vacancy not resulting in an increase in the number of
directors will have the same remaining term as that of his predecessor. Except
in the case of removal from office, any vacancy on the Board of Directors will
be filled by a majority vote of the remaining directors then in office. The
effect of the classified Board of Directors is to make it more difficult for a
person, entity or group to effect a change in control of the Company through the
acquisition of a large block of the Company's voting stock.
Any director may be removed, with or without cause, at any regular or
special meeting of shareholders called for that purpose, and the position filled
by another person nominated and elected for that purpose by the affirmative vote
of the holders of at least 66% of the outstanding shares of the Company's Common
Stock. The Company's officers are appointed by the Board of Directors and hold
office at the will of the Board.
BANK. Each of the Bank's proposed directors will, upon approval of the
Department, serve until the Bank's first annual shareholders meeting, which
meeting will be held shortly after the Bank commences operations. It is
anticipated that each interim director will be nominated to serve as director of
the Bank at that meeting. After the first shareholders meeting, directors of the
Bank will serve for a term of one year and will be elected each year at the
Bank's annual meeting. The Bank's officers will be appointed by its Board of
Directors and will hold office at the will of the Board.
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<PAGE> 38
INITIAL DIRECTORS AND OFFICERS. The following is a brief description of
the business, civic and educational experience of the initial Directors and
Officers:
MONROE E. BERKMAN, AGE 58: Mr. Berkman has been with The Associated Group,
Inc. and its predecessor, Associated Communications Corporation, Inc.,
since 1979 and currently holds the title of Vice President. Additionally,
he serves as President of W. SOL Tampa Bay, Inc. and the Monroe E. &
Suzette M. Berkman Foundation.
Mr. Berkman is a graduate of the University of Pennsylvania. He currently
serves as a Trustee for Berkeley Preparatory School and The Tampa Museum of
Art and is a member of the Board of Directors of The Tampa Marine
Institute. Mr. Berkman has been a resident of Hillsborough County, Florida
since 1973.
JOHN C. BIERLEY, AGE 61: Mr. Bierley has been practicing law for over 30
years. He is a founding partner in the firm of Smith, Clark, Delesie,
Bierley, Mueller & Kadyk, specializing in international law. Mr. Bierley
received his B.A. and J.D. degrees from the University of Florida. He is
admitted to practice by The Florida Bar and the United States Supreme
Court.
Mr. Bierley was a director of Gulf Bay Bank of Florida from 1988 to 1992
and SouthTrust Bank of West Florida from 1992 to 1995, and has been a
director of Cayman National Bank, Ltd. since 1973. He currently serves as
Chairman, Tampa Bay Area Committee on Foreign Relations, Inter-American Bar
Association and the University of Florida Foundation. Mr. Bierley has been
a resident of Hillsborough County, Florida since 1963.
TROY A. BROWN, JR., AGE 64: Mr. Brown is President of RayBro/CED and has
held that position since 1991. Prior to that position, Mr. Brown served as
President and Director of RayBro Electric Supplies, Inc.
Mr. Brown is a graduate of Harvard College and received his J.D. degree
from the University of North Carolina Law School. He is currently a member
of the Florida Bar Association. He has been a past director of First
Florida Bank, First Florida Banks, Inc., Exchange Bank of Tampa, Exchange
Bank of Temple Terrace, Smally Transportation Co., Greater Tampa Chamber of
Commerce and the National Association of Electrical Distributing. Mr. Brown
is a lifetime resident of Hillsborough County, Florida.
FRANK G. CISNEROS, AGE 56: Mr. Cisneros has been President and Chief
Executive Officer of Marman USA, Inc. since 1983. He also currently serves
as President of Westshore Holdings, Inc. Prior to these positions, Mr.
Cisneros served as Chairman of the Board of Micro-Flo Co., Inc.
Mr. Cisneros attended the University of Villanova, Havana, Cuba, and is a
graduate of the University of Tampa. He was a former director of the Gulf
Bay Bank of Tampa and SouthTrust Bank of West Florida, and served as the
director of the Society of International Business Fellows. He has also
served on the Board of Governors of the Greater Tampa Chamber of Commerce,
as a Board member of the United Way of Tampa, the American Red Cross, and
the Jesuit High School Foundation. Mr. Cisneros currently serves as Trustee
for the Academy of the Holy Names Foundation, University of Tampa, Museum
of Science and Industries (MOSI), the Henry B. Plant Museum, and is King
XVII of the Krewe of the Knights of Saint Yago. Mr. Cisneros has been a
resident of Hillsborough County, Florida since 1961.
LAWRENCE H. DIMMITT, III, AGE 51: The Dimmitt family has been in the
automobile dealership business in Clearwater, Florida, for over 75 years.
Mr. Dimmitt has been involved as owner and operator of Dimmitt Chevrolet
since 1972. He received his undergraduate degree from The University of the
South and has attended graduate school at Emory University.
Mr. Dimmitt serves on the Chevrolet National Dealer Council and has served
as Past President of the Clearwater Auto Dealer's Association. He was a
past director of the Northeast Bank of Clearwater from 1981 to 1982, Bank
of Clearwater during 1983 and First Florida Bank of Clearwater from 1984 to
1989. Mr. Dimmitt is a lifetime resident of Pinellas County, Florida.
TIMOTHY A. MCGUIRE, AGE 49: Mr. McGuire has 25 years of broad-based
commercial banking and bank management experience. From 1973 through 1981,
he held various positions with Indiana
33
<PAGE> 39
National Bank, including Vice President and European Representative,
London, England. Subsequently, in 1983 Mr. McGuire joined Barnett Bank
where he held various management positions throughout the Barnett system,
including Vice President-Commercial Lending (Tampa), Vice President-U.S.
Banking (Jacksonville), Senior Vice President & Manager-Commercial Lending
(Jacksonville), Senior Vice President & Credit Manager (Atlanta, GA),
Executive Vice President & Senior Loan Officer and Executive Vice President
& Senior Credit Officer (Atlanta, GA). Most recently, Mr. McGuire
participated in the successful establishment of First of America Bank as a
commercial bank in West Central Florida, and served as the Senior Vice
President and Senior Loan Officer from September, 1994 until First of
America was acquired by South Trust in January, 1998.
Mr. McGuire received his Bachelor of Arts degree from Purdue University and
his Masters of Science in Management from the Krammert Graduate School,
Purdue University. Mr. McGuire has been a resident of Hillsborough County,
Florida since 1994.
ERIC M. NEWMAN, AGE 50: Mr. Newman is President of J.C. Newman Cigar
Company and has been with the company for over 25 years. Mr. Newman
actively serves in the community as President, Rotary Club of Tampa, Board
of Trustees, Congregation Schaarai Zedek, Board of Directors, Merchants
Association of Florida, Board of Directors, University Club of Tampa and
Board of Directors, Cigar Association of America. Mr. Newman was also
selected as Community Hero to carry 1996 Olympic torch.
Mr. Newman received his Bachelor of Arts degree from the University of the
South, and his M.B.A. degree from Emory University. Mr. Newman also has
business interest in the Luis Martinez Cigar Company and SERCO Company. Mr.
Newman has been a resident of Hillsborough County, Florida since 1954.
CHRIS A. PEIFER, AGE 50: Mr. Peifer is President of Tice Financial
Services, Tampa, Florida and has held that position since 1987. Mr. Peifer
was also a director of the Commercial Bank of Georgia from 1987 until 1995.
Since 1997, Mr. Peifer has served as a director of The Medical Manager
following its public offering on the Nasdaq. He also served on the Board of
PrimeSource of Dallas, Texas for a period of nine years. From 1990 to 1994,
Mr. Peifer served as a Board Member of the Tampa Preparatory School and as
Board President from 1994 to 1997. Additionally, he has served on the Board
of The Metropolitan Ministry from 1994 to 1997.
Mr. Peifer received his Bachelor of Arts degree from Denison University and
his Masters in Business Administration from Northwestern University. Mr.
Peifer has been a resident of Hillsborough County, Florida since 1987.
A. BRONSON THAYER, AGE 58: Mr. Thayer is Managing director of The
Investment Counsel Company. Prior to that position, Mr. Thayer was
Chairman and Chief Executive Officer of First Florida Banks, Inc. He has
also served as Executive Vice President and Chief Financial Officer of
Lykes Bros., Inc. and as Vice President of Dominick & Dominick, Inc.
Mr. Thayer is a graduate of Harvard College and received his MBA from New
York University. He currently serves as a director of Lykes Bros., Inc.
Mr. Thayer has also served on the boards of the Jacksonville Branch of the
Federal Reserve Bank of Atlanta, LTV Corp., American Ship Building and
Enron Corporation. Mr. Thayer has been a resident of Hillsborough County,
Florida since 1972.
EXECUTIVE COMPENSATION
The Organizers entered into an employment agreement with Timothy A. McGuire
in September of 1998, to assist the Organizers with the formation of the Company
and the Bank. Under the terms of the Agreement, Timothy A. McGuire will serve as
a Director and President of the Company and is being paid a salary of $6,667 per
month, plus a mileage allowance of $0.315 per mile for business use during the
Bank's organizational phase. The understanding between the Organizers and Mr.
McGuire is that Mr. McGuire will be employed by the Company as its President,
and by the Bank as its President and Chief Executive Officer at an initial
annual base salary of $120,000. The Agreement which initially is for a term of
one year, also contains a commitment to grant, at no cost to him, an option to
purchase a minimum of 34,444 Shares of Company Common Stock at $10.00 per Share.
Such option would vest at the rate of 20% per year over five years, would expire
10 years from the grant date and would be subject to the terms of a qualified
stock option plan adopted by the Company's Board of Directors and approved by
its shareholders. Mr. McGuire will participate in such other benefit plans
which the Bank makes available generally to all employees. The Bank may
terminate Mr. McGuire for any reason upon majority vote of the Board of
Directors. If, however, the termination is
34
<PAGE> 40
without cause, Mr. McGuire will be entitled to severance pay in an amount not to
exceed the remainder due on his contract plus any incentive compensation which
he may have been entitled to. The Board of Directors must review Mr. McGuire's
performance annually, and determine whether to extend the Agreement for a
one-year period. In the event of Mr. McGuire's termination for any reason, Mr.
McGuire agrees not to become employed with any business enterprise who competes
or intends to compete, directly or indirectly, with any office of the Company
located in Hillsborough County for a period of 12 months following such
termination.
TRANSACTIONS WITH AFFILIATES
Mr. Timothy A. McGuire is the only Organizer or proposed director of the
Company who has received any cash compensation for services rendered on behalf
of the Company. See "MANAGEMENT - Executive Compensation." Once the Bank opens
for business, it is anticipated that it will extend loans to the Bank's and/or
the Company's Directors, their associates or members of their immediate
families. Such loans will be made on substantially the same terms and
conditions, including interest rates, collateral and credit underwriting
procedures as those prevailing at the time for comparable transactions by the
Bank with other similarly qualified persons.
STOCK OPTION PLANS
INCENTIVE STOCK OPTION PLAN. The Company's Board of Directors intends to
adopt an Incentive Stock Option Plan ("Plan"), subject to shareholder approval,
for employees who are contributing significantly to the management or operation
of the business of the Company or its subsidiaries as determined by the
committee administering the Plan. The Plan will be contingent upon approval by
the Company's shareholders. The Plan will provide for the grant of options at
the discretion of a committee designated by the Board of Directors to administer
the Plan. No person may serve as a member of the committee who is then eligible
for a grant of options under the Plan or has been so eligible for a period of
one year prior to his service on the committee. The option exercise price must
be at least 100% (110% in the case of a holder of 10% or more of the Common
Stock) of the fair market value of the stock on the date the option is granted,
but in no case will the exercise price be less than the offering price contained
herein. The options are exercisable by the holder thereof in full at any time
following a vesting period and prior to their expiration in accordance with the
terms of the Plan. Stock options granted pursuant to the Plan will expire on or
before (i) the date which is the tenth anniversary of the date the option is
granted, or (ii) the date which is the fifth anniversary of the date the option
is granted in the event that the option is granted to a key employee who owns
more than 10% of the total combined voting power of all classes of stock of the
Company or any subsidiary of the Company. The Company intends to grant to Mr.
McGuire, at no cost to him, an option to purchase a minimum of 34,444 shares of
the Company's common stock. See "MANAGEMENT - Executive Compensation."
The Committee may grant a Limited Right simultaneously with the grant of
any stock option, with respect to all or some of the Shares covered under the
Plan. A Limited Right may not be exercised before six months from the date of
the grant and may be exercised only if: (i) there is a change in control of the
Company; (ii) the underlying option is eligible to be exercised; and (iii) the
fair market value of the underlying Shares on the day of the exercise is greater
than the exercise price of the related option. A Limited Right permits the
holder to obtain cash value of the difference between the exercise price of the
stock option and the fair market value of the common stock to which the holder
would be entitled, if the holder exercised the underlying stock option, without
exercising the stock option.
DIRECTORS STOCK OPTION PLAN. The Company intends to adopt a non-qualified
Directors Stock Option Plan ("Directors' Plan"), subject to shareholder
approval. The Company intends to grant to each of the proposed Organizing
directors options to purchase a minimum of 7,694 shares of common stock under
the Directors Plan. The stock options, granted pursuant to the Directors' Plan
at no cost to the Directors, will bear an exercise price of $10.00 per share.
The Directors' Plan will be designed to provide incentive compensation to
directors in the event that the Company's common stock increases in value during
the term of such options. The Directors' Plan will be subject to shareholder
approval following the Bank's commencement of business. See "ORGANIZERS AND
PRINCIPAL SHAREHOLDERS."
KEY-MAN LIFE INSURANCE
The Company has purchased "key-man" life insurance policy ("Policy")
insuring the life of Mr. McGuire in the amount of $250,000. Should Mr. McGuire
die during the organizational process the Company may elect to terminate the
Offering and refund all subscription proceeds to the Subscribers or the Company
may seek a qualified replacement which would delay the commencement of
operations and increase pre-opening expenses.
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<PAGE> 41
ARTICLES OF INCORPORATION - SUMMARY
GENERAL
The authorized capital stock of the Company is 10,000,000 shares of Common
Stock, par value, $0.01 per share, of which no shares are presently outstanding
and 2,000,000 shares of preferred stock, of which 3,900 shares are presently
held by organizers. See "ORGANIZERS AND PRINCIPAL SHAREHOLDERS."
COMMON STOCK
The holders of Common Stock are entitled to elect the members of the Board
of Directors of the Company and such holders are entitled to vote as a class on
all matters required or permitted to be submitted to the shareholders of the
Company. No holder of any class of stock of the Company has preemptive rights
with respect to the issuance of shares of that or any other class of stock and
the Common Stock is not entitled to cumulative voting rights with respect to the
election of directors.
The holders of Common Stock are entitled to dividends and other
distributions if, as, and when declared by the Board of Directors out of assets
legally available therefore. Upon the liquidation, dissolution or winding up of
the Company, the holder of each share of Common Stock will be entitled to share
equally in the distribution of the Company's assets. The holders of Common Stock
are not entitled to the benefit of any sinking fund provision. The shares of
Common Stock of the Company are not subject to any redemption provisions, nor
are they convertible into any other security or property of the Company. All
shares of Common Stock outstanding upon completion of this Offering will be,
fully paid and nonassessable.
SPECIAL MEETING OF SHAREHOLDERS
A special meeting of the shareholders may be called by a resolution adopted
by a majority of the Board of Directors, the Chairman of the Board or the
President of the Company, or by shareholders holding at least 20% of the
outstanding shares of the Company.
INDEMNIFICATION
The Company's Articles provide for the indemnification of directors and
executive officers to the maximum extent permitted by Florida law.
PREFERRED STOCK
The Board of Directors has the authority to provide for the issuance of
Preferred Stock in series and to determine the number of shares of each series
and the designation, powers, preferences and rights of each series. The Board of
Directors has provided for the issuance of Class A preferred stock for the
purpose of funding pre-opening expenses. Class A Preferred Stock is non-voting
stock which pay no mandatory dividend. The Company has issued an additional
3,000 shares of redeemable preferred stock to organizers at a price of $100.00
per share. The preferred stock is redeemable by the Company for the purchase at
any time after the release of funds by the escrow agent and will not mandate the
payment of any dividend, but will have a distribution preference above common
stock in the event of a dissolution of the Company. The preferred stock pays a
dividend at the sole discretion of the Company. The Company intends to declare a
dividend of 2% of the purchase price of the preferred stock within 30 days of
the closing of the Offering. In the event of a dissolution, the Class A
Preferred Stock will have a distribution preference over Common Stock.
The Company will require the payment of a $10.00 transfer fee with regard
to all requests for cancellation and re-issue of the Company's shares after the
initial issue of share certificates. No such fee will be required for shares
originally issued, or issued in exchange for Warrants.
ANTI-TAKEOVER PROVISIONS
The following sets forth a general summary of certain provisions of the
Company's Articles which may be deemed to have an "anti-takeover effect or
otherwise restrict sales of the Company's Common Stock." Despite the belief of
the Board of Directors of the Company that these restrictive provisions are in
the best interest of the shareholders, these provisions may have the effect of
discouraging a future takeover attempt which would not be
36
<PAGE> 42
approved by the Company's Board of Directors, but pursuant to which shareholders
might receive a premium for their Common Stock over current market prices or the
effect of precluding other corporate action that a majority of the shareholders
felt were in their best interest. As a result, shareholders who might desire to
participate in such a transaction may not have any opportunity to do so. Such
provisions may also render the removal of the Board of Directors of the Company
and management more difficult. Finally, certain restrictive provisions might
make it difficult or impossible to sell Common Stock to persons other than
existing shareholder or the Company or might delay such a sale to such an extent
as to cause a substantial hardship on the selling shareholder.
AUTHORIZED SHARES. The authorized shares of Common Stock were authorized in
an amount greater than that to be issued in this Offering to provide the
Company's Board of Directors with as much flexibility as possible to effect,
among other things, financing, acquisitions, stock dividends, stock splits and
employee stock option transactions. However, these additional authorized shares
may also be used by the Board of Directors consistent with its fiduciary duty to
deter future attempts to gain control of the Company. The Company's Board
currently has no plans for the issuance of any additional Preferred Common Stock
other than the issuance of shares of Common Stock in this Offering.
DIRECTORS. The Company's directors are divided into three classes, with the
term of office of the first class (Class I) to expire at the 1999 Annual Meeting
of Shareholders, the term of office of the second class (Class II) to expire at
the 2000 Annual Meeting, and the term of office of the third class (Class III)
to expire at the 2001 Annual Meeting. Any director, or the entire Board of
Directors, may be removed from office by the affirmative vote of the holders of
at least 60% of the voting power of all of the then outstanding shares of
capital stock of the Company entitled to vote generally in the election of
directors, voting together as a single class.
BUSINESS COMBINATIONS. The Articles require the affirmative vote or consent
of the holders of at least 66% of the shares of voting stock, voting together as
a single class, to approve any merger, consolidation, disposition of all or a
substantial part of the assets of the Company or a subsidiary of the Company,
exchange of securities requiring shareholder approval or liquidation of the
Company.
The Board of Directors of the Company, when evaluating any offer of another
"Person" (as defined in the Articles) to: (i) make a tender or exchange offer
for any equity security of the Company; (ii) merge or consolidate the Company
with another corporation or entity; or (iii) purchase or otherwise acquire all
or substantially all of the properties and assets of the Company, shall, in
connection with the exercise of its judgement in determining what is in the best
interest of the Company and its shareholders, give due consideration to all
relevant factors, including, without limitation: (1) the social and economic
effect of acceptance of such offer on the Company's present and future customers
and employees and those of its subsidiaries in the communities in which its
subsidiaries operate or are located; (2) on the ability of the Company to
fulfill its corporate objectives as a financial bank holding company; and (3) on
the ability of its subsidiary financial banks to fulfill the objectives of such
banks under applicable statutes and regulations.
AMENDMENT OF THE ARTICLES. Generally, amendments to the Articles must be
approved by a majority affirmative vote of its Board of Directors and also by a
majority of the outstanding shares of its voting stock. However, the affirmative
vote of 66% of the outstanding shares held by shareholders entitled to vote is
required to amend sections of the Articles which deal with Special Meetings of
Shareholders and Business Combinations.
LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company or the
proposed Bank is a party or of which any of their properties are subject; nor
are there material proceedings known to the Company contemplated by any
governmental authority; nor are there material proceedings known to the Company,
pending or contemplated, in which any director, officer or affiliate or any
proposed principal security holder of the Company, or any associate of any of
the foregoing is a party or has an interest adverse to the Company or the Bank.
LEGAL MATTERS
Certain legal matters in connection with the shares of Common Stock offered
hereby will be passed upon for the Company by Igler & Dougherty, P.A., Park
Tower - Suite 2625, 400 North Tampa Street, Florida 32602, counsel to the
Company.
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<PAGE> 43
EXPERTS
The financial statements of the Company for the period from May 18, 1998
(date of incorporation) to June 30, 1998 and as of June 30, 1998, included
elsewhere in the Registration Statement have been included in reliance upon the
reports of Hacker, Johnson, Cohen & Grieb, PA, independent certified public
accountants, and upon the authority of said firm as experts in accounting and
auditing matters.
ADDITIONAL INFORMATION
The Company has filed with the Securities and Exchange Commission, 450
Fifth Street Northwest, Washington, D.C. 20549, a Form SB-2 Registration
Statement (herein, together with all amendments thereto, called the
"Registration Statement") under the 33 Act, as amended, with respect to the
shares of Common Stock offered hereby. This filing was made electronically
through EDGAR. This Prospectus does not contain all of the information included
in the Registration Statement. For further information with respect to the
Company and the Common Stock, reference is hereby made to the Registration
Statement and the exhibits and schedules thereto. A complete copy of the
document may be obtained at the Securities and Exchange Commission's web site
located at http://www.sec.gov.
[Financial Statements Follow This Page]
38
<PAGE> 44
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors' Report....................................................... F-2
Balance Sheet at September 30, 1998 (unaudited) and June 30, 1998.................. F-3
Statements of Operations for the three months ended September 30, 1998
(unaudited), for the Period from May 18, 1998 (Date of
Incorporation) to June 30, 1998 and for the Period from May 18,
1998 (Date of Incorporation) to September 30, 1998 (unaudited)............ F-4
Statement of Stockholders' Equity for the Period from May 18, 1998 (Date of
Incorporation) to September 30, 1998 (unaudited).......................... F-5
Statements of Cash Flows for the three months ended September 30, 1998
(unaudited), for the Period from May 18, 1998 (Date of
Incorporation) to June 30, 1998 and for the Period from May 18,
1998 (Date of Incorporation) to September 30, 1998 (unaudited)............ F-6
Notes to Financial Statements as of June 30, 1998 and September 30, 1998
(unaudited) and for the three months ended September 30, 1998
(unaudited), for the Period from May 18, 1998 (Date of
Incorporation) to June 30, 1998 and for the Period from May 18,
1998 (Date of Incorporation) to September 30, 1998 (unaudited)............ F-7 - F-8
</TABLE>
All schedules have been omitted because of the absence of the conditions under
which they are required or because the required information is included in the
financial statements and related notes.
F-1
<PAGE> 45
INDEPENDENT AUDITORS' REPORT
Board of Directors
Florida Business BancGroup, Inc.
Tampa, Florida:
We have audited the accompanying balance sheet of Florida Business BancGroup,
Inc. (a development stage company) (the "Company") at June 30, 1998, and the
related statements of operations, and cash flows for the period from May 18,
1998 (Date of Incorporation) to June 30, 1998. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company at June 30, 1998,
and the results of its operations and its cash flows for the period from May 18,
1998 (Date of Incorporation) to June 30, 1998, in conformity with generally
accepted accounting principles.
HACKER, JOHNSON, COHEN & GRIEB PA
Tampa, Florida
January 27, 1999
F-2
<PAGE> 46
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
<TABLE>
<CAPTION>
SEPTEMBER 30, JUNE 30,
1998 1998
-------------- ---------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash......................................................... $ 13,474 51,637
Deposit...................................................... 4,055 -
-------- --------
Total................................................ $ 17,529 51,637
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Advances from organizers..................................... - 80,000
-------- --------
Stockholders' equity (deficit):
Preferred stock:
Designated Series A, $0.01 par value, redeemable at $100
per share, 1,000 shares, 900 issued and outstanding.... 90,000 -
Nondesignated, no par value, 1,999,000 shares authorized,
none issued or outstanding............................. - -
Common Stock, $0.01 par value 10,000,000 shares authorized,
none issued or outstanding............................... - -
Accumulated deficit........................................ (72,471) (28,363)
-------- --------
Total stockholders' equity (deficit).................... 17,529 (28,363)
-------- --------
Total................................................... $ 17,529 51,637
======== ========
</TABLE>
See Accompanying Notes to Financial Statements.
F-3
<PAGE> 47
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
PERIOD FROM MAY 18, PERIOD FROM MAY 18,
1998 (DATE OF 1998 (DATE OF
THREE MONTHS ENDED INCORPORATION) TO INCORPORATION) TO
SEPTEMBER 30, 1998 JUNE 30, 1998 SEPTEMBER 30, 1998
------------------ -------------------- -------------------
(UNAUDITED) (UNAUDITED) -
<S> <C> <C> <C>
Income........................... $ - - -
--------- -------- --------
Salaries and employee benefits 19,483 14,353 33,836
Organizational costs............. 23,350 13,500 36,850
Other expenses................... 1,275 510 1,785
--------- -------- --------
Total expenses............. 44,108 28,363 72,471
--------- -------- --------
Net loss................... $ (44,108) (28,363) (72,471)
========= ======== ========
</TABLE>
See Accompanying Notes to Financial Statements.
F-4
<PAGE> 48
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS EQUITY
FOR THE PERIOD FROM MAY 18, 1998 (DATE OF INCORPORATION)
TO SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
DESIGNATED
SERIES A PREFERRED STOCK TOTAL STOCKHOLDERS'
------------------------ ACCUMULATED EQUITY
SHARES AMOUNT DEFICIT (DEFICIT)
------ ------ ----------- -------------------
<S> <C> <C> <C> <C>
Balance at May 18, 1998 (date of
incorporation)....................... - $ - - -
Net loss for the period ended
June 30, 1998........................ - - (28,363) (28,363)
--- ------- -------- --------
Balance at June 30, 1998............... - - (28,363) (28,363)
Conversion of advances from organizers
to 900 shares of designated Series A
preferred stock (unaudited).......... 900 90,000 - 90,000
Net loss for the three months ended
September 30, 1998 (unaudited)....... - - (44,108) (44,108)
--- ------- -------- --------
Balance at September 30, 1998
(unaudited).......................... 900 $90,000 (72,471) 17,529
=== ======= ======== ========
</TABLE>
See Accompanying Notes to Financial Statements.
F-5
<PAGE> 49
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Period from May 18, Period from May 18,
1998 (Date of 1998 (Date of
Three Months Ended Incorporation) to Incorporation) to
September 30, 1998 June 30, 1998 September 30, 1998
------------------ ------------------- -------------------
(unaudited) (unaudited)
<S> <C> <C> <C>
Cash flows used in administrative activities during the
development stage:
Net loss........................................... $(44,108) (28,363) (72,471)
--------- -------- --------
Cash flows from operating activities -
Increase in deposit................................ (4,055) - (4,055)
--------- -------- --------
Cash flows from financing activities -
Advances from organizers........................... 10,000 80,000 90,000
--------- -------- --------
Net increase in cash................................... (38,163) 51,637 13,474
Cash at beginning of period............................ 51,637 - -
--------- -------- --------
Cash at end of period.................................. $ 13,474 51,637 13,474
========= ======== ========
Supplemental disclosures of noncash investing
activities:
Conversion of advances from organizers
to 900 shares of designated Series A
preferred stock................................. 90,000 - 90,000
========= ======== ========
</TABLE>
See Accompanying Notes to Financial Statements.
F-6
<PAGE> 50
FLORIDA BUSINESS BANCGROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF JUNE 30, 1998 AND SEPTEMBER 30, 1998 (UNAUDITED) AND FOR THE THREE
MONTHS ENDED SEPTEMBER 30, 1998 (UNAUDITED), FOR THE PERIOD FROM
MAY 18, 1998 (DATE OF INCORPORATION) TO JUNE 30, 1998 AND FOR THE
PERIOD FROM MAY 18, 1998 (DATE OF INCORPORATION) TO
SEPTEMBER 30, 1998 (UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
GENERAL. Florida Business BancGroup, Inc. (the "Company") was incorporated
on May 18, 1998 in the State of Florida for the purpose of operating as a
bank holding company. The Company and its planned subsidiary Bay Cities
Bank (the "Bank") will be located in Tampa, Florida. As of June 30, 1998,
neither the Company nor the Bank has commenced business operations, and
neither will do so until the Offering Period is completed and the
requisite approvals of the Florida Department of Banking and Finance
("Department"), the Federal Deposit Insurance Corporation ("FDIC") and
the Board of Governors of the Federal Reserve System ("Federal Reserve")
are obtained. Therefore, with the exception of organizational costs,
accounting policies have not been established. All organizational costs
have been expensed as incurred. The Company has adopted a fiscal year end
of December 31.
ESTIMATES. The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
(2) RELATED PARTIES
The Company has appointed one of its Organizers as the President and Chief
Executive Officer of the Company.
(3) ADVANCES FROM ORGANIZERS
To provide an initial source of funds with which to pay organizational and
pre-opening expenses, Organizers have made contributions of $80,000 as of
June 30, 1998. On September 29, 1998, these advances and an additional
$10,000 advance were converted into 900 shares of the Company's Series A
preferred stock.
(4) SALE OF COMMON SHARES
The Company plans to offer a minimum of 700,000 units and a maximum of
1,500,000 units in a public offering. The units will be offered at $10
each and will include one common share and one warrant. The Company
expects to incur expenses of approximately $60,000 in offering costs
related to this offering.
(5) WARRANTS
The Company has adopted a warrant plan which provides for up to 1,500,000
warrants to be issued in conjunction with the sale of the Company's
common stock. Each warrant will entitle the holder to purchase one share
of common stock for $10 anytime during a thirty-six month period,
however, the Company has the option to accelerate the warrant exercise
period.
(6) SUBSEQUENT EVENTS
LEASE ON TEMPORARY OFFICE SPACE. On September 3, 1998, the Company entered
into an agreement to lease temporary office space. The lease term is
eleven months and provides for a monthly rental of $4,045. The Company is
negotiating the lease on its permanent office facilities.
SALE OF PREFERRED STOCK. On December 3, 1998, the Company sold 3,000 shares
of its Designated Series A Preferred Stock to certain Organizers of the
Company for an aggregate of $300,000.
F-7
<PAGE> 51
APPENDIX A
ARTICLES OF INCORPORATION
AND
AMENDED ARTICLES OF INCORPORATION
<PAGE> 52
ARTICLES OF INCORPORATION
OF
FLORIDA BUSINESS BANCGROUP, INC.
In compliance with the requirements of Chapter 607, Florida Statutes,
the undersigned, being a natural person, does hereby act as an incorporator in
adopting and filing the following Articles of Incorporation for the purpose of
organizing a business corporation.
ARTICLE I - NAME
The name of the corporation is Florida Business BancGroup, Inc.
("Corporation"). The initial street address of the principal office of the
Corporation is Park Tower, 400 N. Tampa Street, Suite 2625, Tampa, Florida 33602
or at such other place within the State of Florida as the Board of Directors may
designate.
ARTICLE II - NATURE OF BUSINESS
The Corporation may engage in or transact any or all lawful
activities or business permitted under the laws of the United States and the
State of Florida, or any other state, country, territory or nation.
ARTICLE III - CAPITAL STOCK
The maximum number of shares this Corporation is authorized to issue
is 10,000,000, all of which shall be common shares (Common Shares). All Common
Shares shall be identical with each other in every respect and the holders of
Common Shares shall be entitled to one vote for each share on all matters on
which shareholders have the right to vote.
ARTICLE IV - INITIAL REGISTERED AGENT AND STREET ADDRESS
The name of the registered agent is Igler & Dougherty, P.A., 1501
Park Avenue East, Tallahassee, Florida 32301, which address is also the address
of the Registered Office of the Corporation.
ARTICLE V - DIRECTORS
The initial Board of Directors shall consist of five (5) members. The
names and address of the person who will serve on the initial Board of Directors
is:
NAME ADDRESS
---- -------
Timothy A. McGuire Park Tower, 400 N. Tampa Street, Suite 2625
Tampa, Florida 33602
<PAGE> 53
ARTICLE VI - INCORPORATORS
The names and street addresses of the persons signing these Articles
of Incorporation are:
NAME ADDRESS
---- -------
Herbert D. Haughton Igler & Dougherty, P.A.
1501 Park Avenue East
Tallahassee, Florida 32301
ARTICLE VII - INDEMNIFICATION
The Corporation shall indemnify its directors, officers, employees,
and agents to the fullest extent permitted by Florida law.
ARTICLE XIII - AMENDMENT
The Corporation reserves the right to amend or repeal any provision
contained in these Articles of Incorporation in the manner prescribed by Chapter
607, Florida Statutes, and all rights conferred upon shareholders are granted
subject to this reservation;
IN WITNESS WHEREOF, the undersigned incorporator has executed these
Articles of Incorporation this 7th day of May, 1998.
/s/ Herbert D. Haughton
--------------------------------
Herbert D. Haughton
Incorporator/General Counsel
<PAGE> 54
CERTIFICATE OF DESIGNATION OF
REGISTERED AGENT/REGISTERED OFFICE
PURSUANT TO THE PROVISIONS OF SECTION 607.0501, FLORIDA STATUTES, THE
UNDERSIGNED CORPORATION, ORGANIZED UNDER THE LAWS OF THE STATE OF FLORIDA,
SUBMITS THE FOLLOWING STATEMENT IN DESIGNATING THE REGISTERED THE REGISTERED
OFFICE/REGISTERED AGENT, IN THE STATE OF FLORIDA.
1. The name of the corporation is Florida Business BancGroup, Inc.
2. The name and address of the registered agent and office is:
Igler & Dougherty, P.A.
1501 Park Avenue East
Tallahassee, Florida 32301
Having been named as registered agent and to accept service of process for the
above stated corporation at the place designated in this certificate, I hereby
accept the appointment as registered agent and agree to act in this capacity. I
further agree to comply with the provisions of all statutes relating to the
proper and complete performance of my duties, and I am familiar with and accept
the obligations of my position as registered agent.
IGLER & DOUGHERTY, P.A.
By: /s/ Herbert D. Haughton May 7, 1998
----------------------------------- --------------------
Herbert D. Haughton, Secretary Date
<PAGE> 55
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
FLORIDA BUSINESS BANCGROUP, INC.
Pursuant to Section 607.1005, Florida Statutes, Florida Business
BancGroup, Inc. ("Corporation") adopts the following Articles of Amendment to
its Articles of Incorporation dated May 18, 1998.
ARTICLE I
Article III is hereby amended to read:
ARTICLE III - CAPITAL STOCK.
SECTION 1 - CLASSES OF STOCK: The total number of shares of all
classes of capital stock which the Corporation shall have authority to issue is
12,000,000, consisting of:
A. 2,000,000 shares of preferred stock ("Preferred Stock"); and
B. 10,000,000 shares of common stock, par value one cent
($0.01) per share ("Common Stock").
SECTION 2 - COMMON STOCK: There shall be one class of Common Stock.
Each share of Common Stock shall have the same relative rights and be identical
in all respects with every other share of Common Stock. The holders of Common
Stock are entitled to elect the members of the Board of Directors of the Company
and such holders are entitled to vote as a class on all matters required or
permitted to be submitted to the shareholders of the Company. Each holder of
Common Stock is entitled to one vote per share. No holder of any class of stock
of the Company has preemptive rights with respect to the issuance of shares of
that or any other class of stock and the Common Stock is not entitled to
cumulative voting rights with respect to the election of directors.
SECTION 3 - PREFERRED STOCK: The Board of Directors is authorized,
subject to any limitations prescribed by law, to provide for the issuance of the
shares of Preferred Stock in series, and by filing a certificate pursuant to the
applicable laws of the State of Florida (such certificate being hereinafter
referred to as a "Preferred Stock Designation"), to establish from time to time
the number of shares to be included in each such series and to fix the slated
value, designation, powers, preferences and right of the shares of each such
series and any qualifications, limitations or restrictions thereof. The number
of authorized shares of Preferred Stock may be increased or decreased (but not
below the number of shares then outstanding) by the affirmative vote of the
holders of a majority of the Common Stock, without a vote of the holders of the
Preferred Stock, or of any series thereof, unless a vote of any such holders is
required pursuant to the terms of any Preferred Stock Designation.
<PAGE> 56
ARTICLE II
Article V is hereby amended to read:
ARTICLE V - MANAGEMENT OF THE BUSINESS OF THE COMPANY.
SECTION 1 - AUTHORITY OF THE BOARD: The business and affairs of the
Corporation shall be managed by or under the direction of the Board of
Directors. In addition to the powers and authority expressly conferred upon them
by the Florida Statutes or by these Articles of Incorporation or the Bylaws of
the Corporation, the directors are hereby empowered to exercise all such powers
and do all such acts and things as may be exercised or done by the Corporation.
SECTION 2 - ACTION BY SHAREHOLDERS: Any action required or permitted
to be taken by the shareholders of the Corporation must be effected at a duly
called Annual or Special Meeting of Shareholders of the Corporation and may not
be effected by any consent in writing by such shareholders.
SECTION 3 - SPECIAL MEETING OF SHAREHOLDERS: Special Meeting of
shareholders of the Corporation may be called by the Board of Directors pursuant
to a resolution adopted by a majority of the total number of authorized
directors (whether or not there exist any vacancies in previously authorized
directorships at the time any such resolution is presented to the Board for
adoption), the Chairman of the Board or the President of the Corporation, or by
shareholders holding at least 20% of the outstanding shares of the Corporation.
ARTICLE III
Article VI is hereby amended to read:
ARTICLE VI - DIRECTORS.
SECTION 1 - NUMBER OF DIRECTORS: The Board of Directors of the
Corporation shall be comprised of not less than three (3) nor more than fifteen
(15) directors and shall be fixed from time to time exclusively by the Board of
Directors pursuant to a resolution adopted by a majority of the Full Board as
set forth in the Corporation's Bylaws. The Board of Directors is authorized to
increase the number of directors by no more than two and to immediately appoint
persons to fill the new director positions until the next Annual Meeting of
Shareholders, at which meeting the new director positions shall be filled by
persons elected by the shareholders of the voting power of all the
then-outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
SECTION 2 - ELECTION AND TERM: Directors shall be elected by a
plurality of the votes cast by the shares entitled to vote in the election at a
meeting at which a quorum is present. The term of the initial directors of the
Corporation expires at the first shareholders' meeting at which directors are
elected.
2
<PAGE> 57
SECTION 3 - CLASSES: The Directors shall be divided into three
classes, as nearly equal in number as reasonably possible, with the term of
office of the first class (Class I) to expire at the 1999 Annual Meeting of the
Shareholders, the term of office of the second class (Class II) to expire at the
2000 Annual Meeting of Shareholders and the term of office of the third class
(Class III) to expire at the 2001 Annual Meeting of Shareholders. At each Annual
Meeting of Shareholders following such initial classification and election,
directors elected to succeed those directors whose terms expire shall be elected
for a term of office to expire at the third succeeding Annual meeting of
Shareholders after their election.
SECTION 4 - VACANCIES: Subject to the rights of the holders of any
series of Preferred Stock then outstanding, newly created directorships
resulting from any increase in the authorized number of directors of any
vacancies in the Board of Directors resulting from death, resignation,
retirement, disqualification, removal from office or other cause may be filled
only by a majority vote of the directors then in office, though less than a
quorum. Directors so chosen shall hold office for a term expiring at the next
Annual Meeting of Shareholders. No decrease in the number of directors
constituting the Board of Directors shall shorten the term of any incumbent
director.
SECTION 5 - NOTICE: Advance notice of shareholder nominations for the
election of directors and of business to be brought by shareholders before any
meeting of the shareholders of the Corporation shall be given in the manner
provided in the Bylaws of the Corporation.
SECTION 6 - REMOVAL BY SHAREHOLDERS: Subject to the rights of the
holders of any series of Preferred Stock then outstanding, any director, or the
entire Board of Directors, may be removed from office at any time by the
affirmative vote of the holders of at least 66% of the voting power of all of
the then-outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
ARTICLE IV
The following Article VIII is hereby adopted and incorporated into
the Articles of Incorporation:
ARTICLE VIII - ACQUISITION OFFERS.
The Corporation shall not be merged or consolidated with another
corporation or entity and the Corporation shall not sell or otherwise dispose of
all or substantially all of the properties or assets of the Corporation unless
such merger, consolidation, sale or disposition is approved by a vote of at
least 66% of the outstanding shares of common stock of the Corporation.
The Board of Directors of the Corporation, when evaluating any offer
of another Person to: (i) make a tender or exchange offer for any equity
security of the Corporation, (ii) merge or consolidate the Corporation with
another corporation or entity, or (iii) purchase or otherwise acquire all or
substantially all of the properties and assets of the Corporation, shall, in
connection with the exercise of its judgment in determining what is in the best
interest of the Corporation and its
3
<PAGE> 58
shareholders, give due consideration to all relevant factors including, without
limitation, the social and economic effect of acceptance of such offer on the
Corporation's present and future customers and employees and those of its
Subsidiaries; on the communities in which the Corporation and its Subsidiaries
operate or are located; on the ability of the Corporation to fulfill its
corporate objectives as a financial institution holding company and on the
ability of its subsidiary financial institutions to fulfill the objectives of
such institutions under applicable statutes and regulations.
ARTICLE V
Articles XIII is hereby amended to read:
ARTICLE IX - AMENDMENTS.
The Corporation reserves the right to amend or repeal any provision
contained in these Articles of Incorporation in the manner prescribed by Chapter
607, Florida Statutes, and all rights conferred upon shareholders are granted
subject to this reservation; however, an affirmative vote of at least 66% of the
outstanding common stock of the Corporation shall be necessary to amend Articles
VIII and Article V, Section 6 of these Articles.
ARTICLES VI
These amendments were adopted by the Incorporators without
shareholder action prior to the issuance of any shares of the Corporation and
shareholder action was, therefore, not required.
ARTICLE VII
The date of each amendment adopted is the date of the execution of
these Articles.
IN WITNESS WHEREOF, the undersigned Incorporator has executed these
Articles of Amendment to the Articles of Incorporation of Florida Business
Bancgroup, Inc. this 28th day of September, 1998.
/s/ Herbert D. Haughton
-------------------------------------
Herbert D. Haughton
Incorporator/General Counsel
4
<PAGE> 59
APPENDIX B
ESCROW AGREEMENT
<PAGE> 60
INDEPENDENT BANKERS' BANK OF FLORIDA
ESCROW AGREEMENT
This Escrow Agreement is entered into and effective this ____ day of
_______, 1998, by and between Florida Business Bancgroup, Inc., a Florida
corporation (the "Company") and the Independent Bankers' Bank of Florida
("Escrow Agent" or "Agent").
W I T N E S S E T H:
WHEREAS, the Company, proposes to offer for sale up to 1,500,000 shares of
its $ 0.01 par value common stock (the "Common Stock"), which shares shall be
registered under the Securities Act of 1933, as amended, at a price of $10.00
each, in minimum subscriptions of 1,000 shares ("Offering"); and
WHEREAS, the Company has requested the Escrow Agent to serve as the
depository for the payment of subscription proceeds ("Subscription Payment(s) or
Funds") received by the Company from investor(s) who are subscribing to purchase
shares of Common Stock in the Company pursuant to, and in accordance with, the
terms and conditions contained in the Company's Prospectus dated February 8,
1999 and an executed Unit Order Form and Certification ("Unit Order Form"); and
WHEREAS, the Offering will terminate at 5:00 P.M., Local Time, 90 Days
after the Effective Date of the Company's Registration Statement, unless
extended by the Company for up to an additional 90 days ("Offering Period").
NOW THEREFORE, in consideration of the premises and understandings contained
herein, the parties agree as follows:
(1) The Company hereby appoints and designates the Escrow Agent for the
purposes set forth herein. The Escrow Agent acknowledges and accepts said
appointment and designation. The Company understands that the Escrow Agent, by
accepting said appointment and designation, in no way endorses the merits of the
offering of the shares described herein. The Company agrees to notify any person
acting on its behalf that the position of Escrow Agent does not constitute such
an endorsement, and to prohibit said persons from the use of the Agent's name as
an endorser of such offering. The Company further agrees to allow the Escrow
Agent to review any sales literature in which the Agent's name appears and which
is used in connection with such offering.
(2) The Company shall deliver all Subscription Payments received to the
Escrow Agent (Independent Bankers' Bank of Florida, Attn: Customer Service
Group) in the form in which they are received by noon of the fifth (5th)
business day after their receipt by the Company, and the Company shall deliver
to the Escrow Agent within fifteen (15) calendar days after receipt, copies of
written acceptances of the Company for shares in the Company for which the
Subscription Funds represent payment. Upon receipt, the Escrow Agent shall
immediately deposit such funds into the escrow account. The Company shall also
deliver to the Escrow Agent completed copies of Unit Order Forms for each
subscriber, along with such subscriber's name, address, number of shares
subscribed and social security or taxpayer identification number.
(3) Subscription Funds shall be held and disbursed by the Escrow Agent in
accordance with the terms of this Agreement.
(4) In the event any Subscription Payment is dishonored for payment for
any reason, the Escrow Agent agrees to orally notify the Company thereof as soon
as practicable and to confirm same in writing and to return the dishonored
Subscription Funds to the Company in the form in which they were delivered.
(5) Should the Company elect to accept a subscription for less than the
number of shares shown in the purchaser's Unit Order Form, by indicating such
lesser number of shares on the written acceptance of the Company transmitted to
the Escrow Agent, the Escrow Agent shall, upon separate instruction from the
Company, remit within ten (10) days to such subscriber at the address shown in
his Unit Order Form that amount of his Subscription Payment in excess of the
amount which constitutes full payment for the number of subscribed shares
accepted by the Company
Page 1 of 5
<PAGE> 61
as shown in the Company's written acceptance, without interest or diminution.
Said address shall be provided by the Company to the Escrow Agent as requested.
(6) Definitions as used herein:
(a) "Total Receipts" shall mean the sum of all Subscription Payments
delivered to the Escrow Agent pursuant to Paragraph (3) hereof, less: (i) all
Subscription Funds returned pursuant to Paragraphs (4) and (5) hereof; and (ii)
all Subscription Funds which have not been paid by the financial institution
upon which they are drawn.
(b) "Expiration Date" shall mean 5:00 P.M., Local Time, 90 days after
the Effective Date of the Company's Registration Statement dated February 8,
1999; provided, however, in the event that the Escrow Agent is given oral
notification followed in writing, by the Company that it has elected to extend
the offering to a date not later than 90 additional days, then the Expiration
Date shall mean 5:00 P.M., Local Time, on the date to which the offering has
been extended. The Company will notify the Escrow Agent of the effective date of
the Prospectus as soon as practicable after such date has been determined.
(c) "Closing Date" shall mean the business day on which the Company,
after determining that all of the Offering conditions have been met, selects in
its sole discretion. The Closing Date shall be confirmed to the Escrow Agent in
writing by the Company.
(d) "Escrow Release Conditions" shall mean that (i) the Company has
not canceled the Offering, and (ii) that the Company has received preliminary
approval from the appropriate regulatory entity to charter the Bank as well as
preliminary approval for deposit insurance from the FDIC.
(7) If, on or before the Expiration Date, (i) the Total Receipts held by
the Escrow Agent equal or exceed $7,000,000 and (ii) the Company has certified
to the Agent that, upon receipt of the net proceeds of the offering (after the
deduction of all fees, commissions, and other expenses of the offering): (a) the
Company will have stockholders' equity of at least $6,000,000; and (b) the
Escrow Release Conditions have been consummated, the Escrow Agent shall:
(a) No later than 10:00 A.M., Local Time, one day prior to Closing
Date (as that term is defined herein), deliver to the Company all Subscription
Documents provided to the Escrow Agent; and
(b) On the Closing Date, no later than 10:00 o'clock A.M., Local
Time, upon receipt of 24-hour written instructions from the Company, remit all
amounts representing Subscription Funds, plus any profits or earnings, held by
the Escrow Agent pursuant hereto to the Company in accordance with such
instructions.
(8) If (i) the Escrow Release Conditions are not met by the Expiration
Date, or (ii) the offering is canceled by the company at any time prior to the
Expiration Date, then the Escrow Agent shall promptly remit to each subscriber
at the address set forth in his Unit Order Form an amount equal to the amount of
his Subscription Payments thereunder, plus any profits or earnings thereon to
the extent that such profits or earnings are not payable to the Company under
paragraph (9) of this Escrow Agreement. The earnings accruing to any individual
subscriber under this paragraph shall be a prorated share of the gross earnings
on all funds under escrow, weighted by the amount and the duration of the funds
tendered for the individual subscription. Under no circumstances will earnings
accrue to any subscription canceled for any reason other than those provided for
in this paragraph.
(9) Pending disposition of the Subscription Funds under this Agreement,
the Escrow Agent will invest collected Subscription Funds, in $1,000 increments
above a maintained balance of $50,000, in overnight repurchase agreements
collateralized at 102% with obligations of the United States Treasury or United
States Government Agencies. These repurchase agreement transactions will earn
interest at a rate of 35 basis points below the daily Overnight Fed Funds Sold
rate. The Escrow Agent shall pay such investment interest to the Company upon
written instruction from the Company for the purpose of paying or reimbursing
the Company for pre-opening or organizing expenses.
(10) The obligations as Escrow Agent hereunder shall terminate upon the
Agents transferring all funds held hereunder pursuant to the terms of Paragraphs
(7) or (8) herein, as applicable.
Page 2 of 5
<PAGE> 62
(11) The Escrow Agent shall be protected in acting upon any written
notice, request, waiver, consent, certificate, receipt, authorization, or other
paper or document which the Agent believes to be genuine and what it purports to
be.
(12) The Escrow Agent shall not be liable for anything which the Agent may
do or refrain from doing in connection with this Escrow Agreement, except for
the Agent's own gross negligence or willful misconduct.
(13) The Escrow Agent may confer with legal counsel in the event of any
dispute or questions as to the construction of any of the provisions hereof, or
the Agent's duties hereunder, and shall incur no liability and shall be fully
protected in acting in accordance with the opinions and instructions of such
counsel. Any and all expenses and legal fees in this regard will be paid by the
Company.
(14) In the event of any disagreement between the Company and any other
person resulting in adverse claims and demands being made in connection with any
Subscription Funds involved herein or affected hereby, the Agent shall be
entitled to refuse to comply with any such claims or demands as long as such
disagreement may continue, and in so refusing, shall make no delivery or other
disposition of any Subscription Funds then held under this Agreement which are
the subject of such disagreement, and in so doing shall be entitled to continue
to refrain from acting until (a) the right of adverse claimants shall have been
finally settled by binding arbitration or finally adjudicated in a court in
Orange County, Florida assuming and having jurisdiction of the Subscription
Funds involved herein or affected hereby or (b) all differences shall have been
adjusted by agreement and the Agent shall have been notified in writing of such
agreement signed by the parties hereto. In the event of such disagreement, the
Agent may, but need not, tender into the registry or custody of any court of
competent jurisdiction in Orange County, Florida all money or property in the
Agent's hands under the terms of this Agreement, together with such legal
proceedings as the Agent deems appropriate and thereupon to be discharged from
all further duties under this Agreement. The filing of any such legal proceeding
shall not deprive the Agent of compensation earned prior to such filing. The
Escrow Agent shall have no obligation to take any legal action in connection
with this Agreement or towards its enforcement, or to appear in, prosecute or
defend any action or legal proceeding which would or might involve the Agent in
any cost, expense, loss or liability unless indemnification shall be furnished.
(15) The Escrow Agent may resign for any reason, upon thirty (30) days
written notice to the Company. Upon the expiration of such thirty (30) day
notice period, the Escrow Agent may deliver all Subscription Funds and Unit
Order Forms in possession under this Escrow Agreement to any successor Escrow
Agent appointed by the Company, or if no successor Escrow Agent has been
appointed, to any court of competent jurisdiction. Upon either such delivery,
the Escrow Agent shall be released from any and all liability under this Escrow
Agreement. A termination under this paragraph shall in no way change the terms
of Paragraphs (14) and (16) affecting reimbursement of expenses, indemnity and
fees.
(16) The Escrow Agent will charge the Company for services hereunder a fee
of $1,500, plus an additional fee of $5.00 for each check issued, $10.00 for
each wire and $.50 for each photo copy necessitated in the performance of
duties, with total fees for services not to exceed $2,500. All actual expenses
and costs incurred by the Agent in performing obligations under this Escrow
Agreement will be paid by the Company. All fees and expenses shall be paid on
the Closing Date by the Company. Any subsequent fees and expenses will be paid
by the Company upon receipt of invoice.
(17) All notices and communications hereunder shall be in writing and
shall be deemed to be duly given if sent by registered or certified mail, return
receipt requested, to the respective addresses set forth herein. The Escrow
Agent shall not be charged with knowledge of any fact, including but not limited
to performance or non-performance of any condition, unless the Escrow Agent has
actually received written notice thereof from the Company or its authorized
representative clearly referring to this Escrow Agreement.
(18) The rights created by this Escrow Agreement shall inure to the
benefit of, and the obligations created hereby shall be binding upon the
successors and assigns of the Escrow Agent and the parties hereto.
(19) This Escrow Agreement shall be construed and enforced according to
the laws of the State of Florida.
(20) This Escrow Agreement shall terminate and the Escrow Agent shall be
discharged of all responsibility hereunder at such time as the Escrow Agent
shall have completed all duties hereunder.
Page 3 of 5
<PAGE> 63
(21) This Escrow Agreement may be executed in several counterparts, which
taken together shall constitute a single document.
(22) This Escrow Agreement constitutes the entire understanding and
agreement of the parties hereto with respect to the transactions described
herein and supersedes all prior agreements or understandings, written or oral,
between the parties with respect thereto.
(23) If any provision of this Escrow Agreement is declared by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force and effect without being
impaired or invalidated in any way.
(24) The Company shall provide the Escrow Agent with its Employer
Identification Number as assigned by the Internal Revenue Service. Additionally,
the Company shall complete and return to the Escrow Agent any and all tax forms
or reports required to be maintained or obtained by the Escrow Agent.
(25) The authorized signature of the Escrow Agent hereto is consent that a
signed copy hereof may be filed with the various regulatory authorities of the
State of Florida and with any Federal regulatory authorities.
IN AGREEMENT AND ACCEPTANCE OF THE INDEPENDENT BANKERS' BANK OF FLORIDA ESCROW
AGREEMENT BETWEEN FLORIDA BUSINESS BANCGROUP, INC. (COMPANY), FOR THE PURPOSE OF
ORGANIZING A FINANCIAL INSTITUTION TO BE KNOWN AS BAY CITIES BANK, AND THE
INDEPENDENT BANKERS' BANK OF FLORIDA (ESCROW AGENT).
FLORIDA BUSINESS BANCGROUP, INC.
Address: 500 N. Westshore Boulevard,
Suite 1000
Tampa, Florida 33609
Phone: (813) 282-7242
ATTEST:
By: By:
------------------------------- -------------------------------
Authorized Signature
Title: Title:
------------------------------- ------------------------------
(Type Name and Title) (Type Name and Title)
ATTEST: ADDITIONAL AUTHORIZED SIGNER
By: By:
------------------------------- -------------------------------
Authorized Signature
Title: Title:
------------------------------- ------------------------------
(Type Name and Title) (Type Name and Title)
(CORPORATE SEAL)
Page 4 of 5
<PAGE> 64
IN AGREEMENT AND ACCEPTANCE OF THE INDEPENDENT BANKERS' BANK OF FLORIDA ESCROW
AGREEMENT BETWEEN FLORIDA BUSINESS BANCGROUP, INC. (COMPANY), FOR THE PURPOSE OF
ORGANIZING A FINANCIAL INSTITUTION TO BE KNOWN AS BAY CITIES BANK, AND THE
INDEPENDENT BANKERS' BANK OF FLORIDA (ESCROW AGENT).
INDEPENDENT BANKERS' BANK OF FLORIDA
Address: 615 Crescent Executive Court
Suite 400
Lake Mary, FL 32746-2109
Phone: (407) 541-1620
Fax: (407) 541-1663
ATTEST:
<TABLE>
<S> <C>
By: By:
---------------------------------- -----------------------------------------------
Authorized Signature
Title: Title: James H. McKillop, Executive Vice President
------------------------------- -------------------------------------------
(Type Name and Title) (Type Name and Title)
ATTEST: ADDITIONAL AUTHORIZED SIGNER
By: By:
---------------------------------- -----------------------------------------------
Authorized Signature
Title: Title:
------------------------------- ----------------------------------------
(Type Name and Title) (Type Name and Title)
(CORPORATE SEAL)
</TABLE>
Page 5 of 5
<PAGE> 65
APPENDIX C
UNIT ORDER FORM
<PAGE> 66
UNIT ORDER FORM & FLORIDA BUSINESS BANCGROUP, INC.
CERTIFICATION
(Holding Company for Bay Cities Bank)
(OFFERING ORDER FORM)
Note: Please read the Stock Order Form Guide and Instructions on the back of
this form before completion
- --------------------------------------------------------------------------------
DEADLINE: The Offering began February 8, 1999. A condition of the Offering is
that the Minimum Offering (sale of 700,000 Units, each Unit consisting of one
(1) share of Common Stock and one (1) Warrant to purchase one (1) additional
share of Common Stock for $10.00, must be completed on or before August 7, 1999,
or the Offering will be terminated. If the minimum offering is consummated, the
Offering will continue so long as shares remain available or until 5:00 p.m.
Local Time, on August 7, 1999, whichever occurs first, unless terminated by the
Company beforehand.
- --------------------------------------------------------------------------------
NUMBER OF UNITS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
(1) Number of Units Price Per Unit (2) Total Amount Due
------------------- ----------------
x $10.00 = $
------------------- ----------------
</TABLE>
The minimum number of Units that may be subscribed for is 1,000. The maximum any
individual and their Related Party may subscribe for in the Offering is 148,500
Units or 9.9% of the total number of shares outstanding following the completion
of the Offering. See the Section entitled "THE OFFERING - General" on page 10 of
the Prospectus dated February 8, 1999.
- --------------------------------------------------------------------------------
METHOD OF PAYMENT AND PURCHASER INFORMATION
- --------------------------------------------------------------------------------
(3) [ ] Enclosed is a check, bank draft or money order payable to INDEPENDENT
BANKERS' BANK OF FLORIDA FBO FBBI of $___________.
(4) [ ] Check here if you are a director or employee of FBBI or a member of such
person's immediate family.
- --------------------------------------------------------------------------------
STOCK REGISTRATION
- --------------------------------------------------------------------------------
(5) Form of stock ownership
<TABLE>
<S> <C> <C>
[ ] Individual [ ] Uniform Transfer to Minors [ ] Partnership
[ ] Joint Tenants [ ] Uniform Gift to Minors [ ] Individual Retirement Account
[ ] Tenants in Common [ ] Corporation [ ] Fiduciary/Trust (Under Agreement Dated ________)
</TABLE>
<TABLE>
<S> <C> <C> <C>
----------------------------------------------------------------------------- --------------------------------------------
Name Social Security or Tax I.D.
----------------------------------------------------------------------------- --------------------------------------------
Name Daytime Telephone
-------------------------------------------------------- -----------------------------------------------------------------
Street Address Evening Telephone
----------------------------------------------------------------------------- --------------------------------------------
City State Zip Code State of Residence
----------------------------------------------------------------------------- --------------------------------------------
</TABLE>
NOTE: THE UNIT ORDER FORM AND CERTIFICATION WILL CONSTITUTE A BINDING
SUBSCRIPTION FOR THE PURCHASE OF COMMON STOCK OF FLORIDA BUSINESS
BANCGROUP, INC. ACCORDING TO ITS TERMS AND THE TERMS SET FORTH IN THE FORM
OF ACCEPTANCE.
================================================================================
OFFICE USE Batch # _______
Date Rec'd ___/____/____ Order # ____________
Check # _____________ Category ____________
Amount $____________ Initials ____________
================================================================================
<PAGE> 67
- --------------------------------------------------------------------------------
NASD AFFILIATION (This section only applies to those individuals who meet the
delineated criteria)
- --------------------------------------------------------------------------------
[ ] Check here if you are a member of the National Association of Securities
Dealers, Inc. ("NASD"), a person associated with an NASD member, a member of the
immediate family of any such person to whose support such person contributes,
directly or indirectly, or the holder of an account in which an NASD member or
person associated with an NASD member has a beneficial interest. To comply with
conditions under which an exemption from the NASD's Interpretation with Respect
to Free-Riding and Withholding is available, you agree, if you have checked the
NASD affiliation box: (1) not to sell, transfer or hypothecate the shares
subscribed for herein for a period of three months following the issuance, and
(2) to report this subscription in writing to the applicable NASD member within
one day of the payment therefor.
- --------------------------------------------------------------------------------
ACKNOWLEDGMENTS
- --------------------------------------------------------------------------------
1. By signing below, I acknowledge receipt of the Prospectus dated February 8,
1999, and that I have reviewed all provisions therein. I understand that I
may not change or revoke my order once it is received by FBBI. I also
certify that this stock order is for my account and there is no agreement
or understanding regarding any further sale or transfer of these shares.
2. Under penalties of perjury, I further certify that:
(i) the social security number or taxpayer identification number given
above is correct; and
(ii) I am not subject to backup withholding.
If you have been notified by the Internal Revenue Service that you are
subject to backup withholding because of under-reporting interest or
dividends on your tax return, you must cross out Item (ii) above.
3. By signing below, I also acknowledge that I have not waived any rights
under the Securities Act of 1933 and the Securities Exchange Act of 1934.
4 By signing below, I hereby represent to FBBI that the purchase of shares
subscribed for complies with the "Purchase Limitation" set forth in the
Prospectus dated February 8, 1999.
5. By signing below, I certify that before purchasing the Common Stock of FBBI
that I received a copy of the Prospectus dated, February 8, 1999, which
discloses the nature of the Common Stock being offered thereby and
describes certain risks involved in an investment in the Common Stock under
the heading "Risk Factors" beginning on page 6 of the Prospectus.
- --------------------------------------------------------------------------------
SIGNATURE
- --------------------------------------------------------------------------------
THIS FORM MUST BE SIGNED AND DATED. THIS ORDER IS NOT VALID IF THE UNIT ORDER
FORM IS NOT SIGNED. YOUR ORDER WILL BE FILLED IN ACCORDANCE WITH THE PROVISIONS
OF THE PROSPECTUS.
When purchasing as a custodian, corporate officer, etc.; include your full
title. An additional signature is required only if payment is by withdrawal from
an account that requires more than one signature to withdraw funds.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Signature Title (if applicable) Date
- --------------------------------------------------------------------------------
<S> <C> <C>
1.
- --------------------------------------------------------------------------------
2.
- --------------------------------------------------------------------------------
3.
- --------------------------------------------------------------------------------
</TABLE>
THE SHARES OF COMMON STOCK OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS AND ARE NOT
INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE BANK
INSURANCE FUND OR ANY OTHER GOVERNMENTAL AGENCY.
RETURN THIS FORM TO: Florida Business BancGroup, Inc.
Attn: Stock Sales Center
Austin Center West - Tower II
1408 North Westshore Boulevard, Suite 502
Tampa, Florida 33607
<PAGE> 68
FLORIDA
BUSINESS UNIT ORDER FORM GUIDE
BANCGROUP, INC. AND INSTRUCTIONS
- --------------------------------------------------------------------------------
INSTRUCTIONS
- --------------------------------------------------------------------------------
ITEMS 1 AND 2 - Fill in the number of Units that you wish to purchase and the
total payment due. The amount due is determined by multiplying the number of
Units by the Subscription Price of $10.00 per share. The minimum purchase is
1,000 Units. With the exception of the Organizers, the maximum amount any
participant may purchase in the Offering is 148,500 Units in the Offering, or
9.9% of the total number of shares outstanding following the completion of the
Offering, whichever is greater.
FBBI has reserved the right to reject any subscription received in the Offering,
if any, in whole or in part.
ITEM 3 - Payment for shares may be made by check, bank draft or money order made
payable to "INDEPENDENT BANKERS' BANK OF FLORIDA FBO FBBI." DO NOT MAIL CASH.
Your funds will be returned promptly with interest if the Offering is
terminated.
ITEM 5 - The stock transfer industry has developed a uniform system of
shareholder registrations that we will use in the issuance of FBBI common stock.
Print the name(s) in which you want the shares registered and the mailing
address of the registration. Include the first name, middle initial and last
name of the shareholder. Avoid the use of two initials. Please omit the words
that do not affect ownership rights, such as "Mrs.," "Mr.," "Dr.," "special
account," etc.
SEE YOUR LEGAL OR FINANCIAL ADVISOR IF YOU ARE UNSURE ABOUT THE CORRECT
REGISTRATION OF YOUR STOCK AND WARRANTS.
INDIVIDUAL - The shares and warrants are to be registered in an individual's
name only. You may not list beneficiaries for this ownership.
TENANTS IN COMMON - Tenants in common may also identify two or more owners. When
shares/warrants are held by tenants in common, upon the death of one co-tenant,
ownership of the shares/warrants will be held by the surviving co-tenant(s) and
by the heirs of the deceased co-tenant. All parties must agree to the transfer
or sale of shares held by tenants in common. You may not list beneficiaries for
this ownership.
INDIVIDUAL RETIREMENT ACCOUNT - Individual Retirement Account ("IRA") holders
may make unit purchases from their deposits through a pre-arranged
"trustee-to-trustee" transfer. Shares may only be held in a self-directed IRA.
Bay Cities Bank does not offer a self-directed IRA. Please contact the Stock
Sales Center if you have any questions about your IRA account. There will be no
early withdrawal or IRS penalties incurred in these transactions.
UNIFORM GIFT TO MINORS - For residents of many states, shares/warrants may be
held in the name of a custodian for the benefit of a minor under the Uniform
Transfers to Minors Act. For residents in other states, shares may be held in a
similar type of ownership under the Uniform Gift to Minors Act of the individual
states. For either type of ownership, the minor is the actual owner of the
shares with the adult custodian being responsible for the investment until the
child reaches legal age.
On the first line, print the first name, middle initial and last name of the
custodian, with the abbreviation "CUST" and "Unif Tran Min Act" or "Unif Gift
Min Act" after the name. Print the first name, middle initial and last name of
the minor on the second "NAME" line. Standard U.S. Postal Service state
abbreviations should be used to describe the appropriate state. For example,
shares held by John Doe as custodian for Susan Doe under the Ohio Transfer to
Minors Act will be abbreviated John Doe, CUST Susan Doe Unif Tran Min Act. OH.
USE THE MINOR'S SOCIAL SECURITY NUMBER. Only one custodian and one minor may be
designated.
(Front)
<PAGE> 69
JOINT TENANTS - Joint Tenants with right of survivorship identifies two or more
owners. When shares/warrants are held by joint tenants with rights of
survivorship, ownership automatically passes to the surviving joint tenant(s)
upon the death of any joint tenant. You may not list beneficiaries for this
ownership.
CORPORATION/PARTNERSHIP - Corporations/Partnerships may purchase Units. Please
provide the Corporation's/Partnership's legal name and Tax I.D.
FIDUCIARY/TRUST - Generally, fiduciary relationships (such as trusts, estates,
guardianships, etc.) are established under a form of trust agreement or pursuant
to a court order. Without a legal document establishing a fiduciary
relationship, your shares/warrants may not be registered in a fiduciary
capacity.
On the first "NAME" line, print the first name, middle initial and last name of
the fiduciary if the fiduciary is an individual. If the fiduciary is a
corporation, list the corporate title on the first "NAME" line. Following the
name, print the fiduciary "title" such as trustee, executor, personal
representative, etc.
On the second "NAME" line, print either the name of the maker, donor or testator
OR the name of the beneficiary. Following the name, indicate the type of legal
document establishing the fiduciary relationship (agreement, court order, etc.).
In the blank after "Under Agreement Dated," fill in the date of the document
governing the relationship. The date of the document need not be provided for a
trust created by a will.
An example of fiduciary ownership of stock in the case of a trust is: "John D.
Smith, Trustee for Thomas A. Smith Trust Under Agreement Dated June 9, 1987."
- --------------------------------------------------------------------------------
DEFINITION OF ASSOCIATE
- --------------------------------------------------------------------------------
A person's Associates consist of the following: (a) any corporation or other
organization (other than Florida Business BancGroup, Inc. ["FBBI"], Bay Cities
Bank ["Bank"], or a majority owned subsidiary of the Bank) of which such person
is a director, officer or partner or is directly or indirectly the beneficial
owner of 10% or more of any class of equity securities; (b) any trust or other
estate in which such person has a substantial beneficial interest or as to which
such person serves as trustee or in a similar fiduciary capacity, provided,
however, that such term shall not in include any tax-qualified employee stock
benefit plan of FBBI or the Bank in which such person has a substantial
beneficial interest or serves as a trustee or in a similar fiduciary capacity;
and (c) any relative or spouse of such person, or any relative of such person,
who either has the same home as such person or who is a director or officer of
FBBI or the Bank or any of their subsidiaries.
- --------------------------------------------------------------------------------
NON-TRANSFERABILITY OF RIGHTS
- --------------------------------------------------------------------------------
Subscription rights are not transferable. If you are a qualified shareholder, to
protect your priority over other purchasers as described in the Prospectus, you
must take ownership in at least one of the account holder's names. Enter the
Social Security or Tax I.D. number of one registered owner. This registered
owner must be listed on the first "NAME" line. BE SURE TO INCLUDE YOUR TELEPHONE
NUMBER BECAUSE WE WILL NEED TO CONTACT YOU IF WE CANNOT EXECUTE YOUR ORDER AS
GIVEN. Review the Stock Ownership Guide and refer to the instructions for
Uniform Gift to Minors/Uniform Transfer to Minors and Fiduciaries.
<PAGE> 70
STOCK AND WARRANT CERTIFICATE REGISTRATION
INSTRUCTIONS
- --------------------------------------------------------------------------------
Name:
- --------------------------------------------------------------------------------
Additional Name if Tenant in Common, Joint Tenant or Tenants by the Entireties
(see below): _________________
- --------------------------------------------------------------------------------
Mailing Address:
----------------------------------------------------------------
----------------------------------------------------------------
Social Security Number or other Taxpayer Identification Number:
----------------
Number of Shares to be registered in above name(s):
-----------------------------
Legal form of ownership:
___ Individual ___ Joint Tenants with Rights of Survivorship
___ Tenants in Common ___ Uniform Gift to Minors
___ Tenants by the Entirety ___ Other ______________________
(Husband and wife only)
INFORMATION AS TO BANKING INTERESTS
1. As a prospective shareholder I would be interested in the following services
checked below:
<TABLE>
<CAPTION>
PERSONAL BUSINESS
<S> <C> <C>
(a) Checking Account ___ ___
(b) Savings Account ___ ___
(c) Certificates of Deposit ___ ___
(d) Individual Retirement Accounts ___ ___
(e) Checking Account Overdraft Protection ___ ___
(f) Commercial Cash Management Services ___
(g) Consumer Loans (Auto, etc.) ___ ___
(h) Commercial Loans ___
(i) Equity Line of Credit ___ ___
(j) Commercial Mortgage Loans ___
(k) Residential Mortgage Loans ___ ___
(l) Revolving personal Credit Line ___ ___
(m) Safe Deposit Box ___ ___
(n) Automatic Teller Machines (ATM's) ___ ___
(o) Debit Card ___ ___
(p) Visa/MasterCard ___ ___
(q) Future Trust Services ___ ___
</TABLE>
2. I would like our new bank to provide the following additional services:
----------------------------------------------------------------------------
----------------------------------------------------------------------------
<PAGE> 71
FORM OF ACCEPTANCE
FLORIDA BUSINESS BANCGROUP, INC.
500 N. WESTSHORE BOULEVARD
SUITE 1000
TAMPA, FLORIDA 33609
Dear Subscriber:
Florida Business BancGroup, Inc. ("Company"), acknowledges receipt of your
order for _______ Units, each consisting of one Share of its $0.01 par value
Common Stock and one Warrant to purchase one share of Common Stock and your
check in the amount of $________________.
The Company hereby accepts your order for the purchase of _________ Units,
for an aggregate amount of $______________, effective as of the date of this
letter.
YOUR STOCK CERTIFICATE(S) REPRESENTING SHARES OF COMMON STOCK DULY
AUTHORIZED AND FULLY PAID ALONG WITH YOUR WARRANT CERTIFICATE WILL BE ISSUED TO
YOU AS SOON AS PRACTICABLE AFTER ALL SUBSCRIPTION FUNDS ARE RELEASED TO THE
COMPANY FROM THE SUBSCRIPTION ESCROW ACCOUNT, AS DESCRIBED IN THE UNIT ORDER
FORM EXECUTED BY YOU AND IN THE PROSPECTUS WHICH YOU HAVE BEEN FURNISHED. IN THE
EVENT THAT: (I) THE OFFERING IS CANCELED; OR (II) THE MINIMUM NUMBER OF
SUBSCRIPTIONS (700,000 UNITS) IS NOT OBTAINED; OR (III) THE COMPANY SHALL NOT
HAVE RECEIVED APPROVAL FROM THE FEDERAL RESERVE TO BECOME A BANK HOLDING
COMPANY; OR (IV) THE BANK SHALL NOT HAVE RECEIVED FINAL CHARTER APPROVAL FROM
THE FLORIDA COMPTROLLER AND APPROVAL FOR DEPOSIT INSURANCE FROM THE FEDERAL
DEPOSIT INSURANCE CORPORATION, YOUR SUBSCRIPTION FUNDS WILL BE RETURNED TO YOU,
TOGETHER WITH ANY PRO RATA PORTION OF INTEREST EARNED THEREON, IF ANY, AS
DESCRIBED IN THE PROSPECTUS.
If this acceptance is for a lesser number of Units than that number
ordered by you as indicated in your Unit Order Form, your payment for Units in
excess of the number of Units accepted hereby will be refunded to you by mail,
without interest, within ten (10) days of the date hereof.
Very truly yours,
FLORIDA BUSINESS BANCGROUP, INC.
By:
-----------------------------------
President & Chief Executive Officer
<PAGE> 72
<TABLE>
<S> <C>
======================================= =======================================
NO DEALER, SALESPERSON OR OTHER
PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE MINIMUM 700,000 UNITS
CONTAINED IN THIS PROSPECTUS, AND, IF MAXIMUM 1,500,000 UNITS
GIVEN OR MADE, SUCH OTHER INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR AN
OFFER TO BUY, ANY SECURITIES OTHER
THAN THE UNITS TO WHICH IT RELATES, LOGO
OR ANY OFFER OF SUCH UNITS TO ANY
PERSON IN ANY STATE OR OTHER
JURISDICTION IN WHICH SUCH OFFER IS
UNLAWFUL. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL UNDER ANY
CIRCUMSTANCES CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THAT INFORMATION CONTAINED
HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO ANY OF THE DATES AS OF
OFFERS OR SALES ARE BEING MADE
HEREUNDER, THE COMPANY IS REQUIRED TO
UPDATE THE PROSPECTUS TO REFLECT ANY
FACTS OR EVENTS ARISING AFTER THE
EFFECTIVE DATE OF THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION WHICH REPRESENT
A FUNDAMENTAL CHANGE IN THE INFORMATION
SET FORTH IN THE REGISTRATION STATEMENT.
UNTIL AUGUST 7, 1999, ALL DEALERS
EFFECTING TRANSACTIONS IN THE UNITS,
WHETHER OR NOT PARTICIPATING IN THIS
DISTRIBUTION, MAY BE REQUIRED TO
DELIVER A PROSPECTUS. THIS DELIVERY
REQUIREMENT IS IN ADDITION TO THE
OBLIGATION OF DEALERS TO DELIVER A
PROSPECTUS WHEN ACTING AS UNDERWRITERS
AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.
FLORIDA BUSINESS BANCGROUP, INC.
a proposed Bank Holding Company for
- -------------------------------------- Bay Cities Bank, Tampa, Florida
(a proposed State-Chartered Bank)
TABLE OF CONTENTS
PROSPECTUS SUMMARY.................... 3
RISK FACTORS.......................... 6
THE COMPANY...........................10
TERMS OF THE OFFERING.................10 EACH UNIT CONSISTS OF ONE SHARE OF
USE OF PROCEEDS.......................14 COMMON STOCK AND ONE
DIVIDEND POLICY.......................15 WARRANT TO PURCHASE
MANAGEMENT'S DISCUSSION AND ANALYSIS ADDITIONAL COMMON STOCK
OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.....................16
BUSINESS OF THE COMPANY...............17
BUSINESS OF THE BANK..................18
REGULATION AND SUPERVISION............28
ORGANIZERS AND PRINCIPAL SHAREHOLDERS.32
MANAGEMENT............................34
ARTICLES OF INCORPORATION - SUMMARY...38
LEGAL PROCEEDINGS.....................40
LEGAL MATTERS.........................40
EXPERTS...............................40
ADDITIONAL INFORMATION................40
INDEX TO FINANCIAL STATEMENTS.........F-1
------------------
APPENDIX A - ARTICLES OF INCORPORATION PROSPECTUS
APPENDIX B - ESCROW AGREEMENT ------------------
APPENDIX C - STOCK ORDER FORM
February 8, 1999
======================================= =======================================
</TABLE>
<PAGE> 73
PART-II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24: INDEMNIFICATION OF DIRECTORS AND OFFICERS
As provided under Florida law, the Company's Directors shall not be
personally liable to the Company or its stockholders for monetary damages for
breach of duty of care or any other duty owed to the Company as a director,
unless the breach of or failure to perform those duties constitutes: (i) a
violation of criminal law, unless the director had reasonable cause to believe
his conduct was lawful, or had no reasonable cause to believe his conduct was
unlawful; (ii) a transaction from which the director received an improper
personal benefit; (iii) for unlawful corporate distributions; or (iv) an act or
omission which involves a conscious disregard for the best interests of the
Corporation or which involves willful misconduct; or (v) an act of recklessness
or an act or omission which was committed in bad faith or with malicious purpose
or in a manner exhibiting wanton and willful disregard of human rights, safety,
or property.
Article VII of the Company's Articles of Incorporation provides that the
Company shall indemnify its directors, officers, employees, and agents to the
fullest extent permitted by Florida law.
<PAGE> 74
ITEM 25: OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth all expenses expected to be incurred in
connection with the issuance and distribution of the securities being
registered, other than the underwriting discounts and commissions, if any. All
of the amounts shown are estimated except for the registration fees of the SEC.
<TABLE>
<S> <C>
SEC Registration Fees ....................................... $8,850
Blue Sky Registration Fees & Expenses ....................... 5,000
Legal fees and expenses ..................................... 20,000
Accounting Fees ............................................. 2,000
Printing and Engraving expenses ............................. 7,650
Electronic Filing Services .................................. 17,000
Miscellaneous ............................................... 2,000
-------
Total .................................. $62,500
=======
</TABLE>
ITEM 26: RECENT SALES OF UNREGISTERED SECURITIES.
During the organizational phase of the Company, and in order to meet the
net worth requirements of a Florida issuer, the Company issued 3,900 shares of
Preferred Stock in a private Offering to its directors for $100.00 per share.
<PAGE> 75
ITEM 27: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Numbered Page
-------- --------------
<S> <C>
+* 3.1 Articles of Incorporation and Amended Articles of
Incorporation of Florida Business BancGroup, Inc.
* 3.2 By-Laws of Florida Business BancGroup, Inc.
* 4.1 Specimen Common Stock Certificate.
* 4.2 Specimen Warrant Certificate.
++* 4.3 Escrow Agreement with Independent Bankers'
Bank of Florida.
* 4.4 Warrant Plan.
* 5.1 Opinion of Igler & Dougherty, P.A., regarding
legality of shares.
*10.1 Employment Agreement between the Company
and Timothy A. McGuire.
*10.2 Lease Agreement for Temporary Office.
*10.3 Outsourcing Agreement by and Between Bay Cities Bank and
M&I Data Services
10.4 Lease Agreement for Permanent Office
*21.0 Subsidiaries of Florida Business BancGroup, Inc.
*23.1 Consent of Igler & Dougherty, P.A.
23.2 Consent of Hacker, Johnson, Cohen & Grieb
*24 Power of Attorney
27 Financial Data Schedule
*99.1 Letter to Prospective Investor
+++*99.2 Unit Order Form
</TABLE>
* Denotes previously EDGAR filed as part of this Registration Statement,
File No. 333-62101.
+ (Incorporated within as Appendix A of Prospectus)
++ (Incorporated within as Appendix B of Prospectus)
+++ (Incorporated within as Appendix C of Prospectus)
<PAGE> 76
ITEM 28. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) (Section 230.424[b] of this
chapter) if, in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(c) The undersigned registrant hereby undertakes to supplement the
prospectus, after the expiration of the subscription period, to set forth the
results of the subscription offer, the transactions by the underwriters during
the subscription period, the amount of unsubscribed securities to be purchased
by the underwriters, and the terms of any subsequent reoffering thereof. If any
public offering by the underwriters is to be made on terms different from those
set forth on the cover page of the prospectus, a post-effective amendment will
be filed to set forth the terms of such offering.
(e) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or paid by a
director, officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
<PAGE> 77
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment No. 3 to Form SB-2 Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, on this 8th
day of January, 1999.
FLORIDA BUSINESS BANCGROUP, INC
By: /s/ * Timothy A. McGuire
---------------------------------------------------
Timothy A. McGuire
Director, President and Principal Financial Officer
(Principal Accounting Officer)
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 3 to Form SB-2 Registration Statement has been signed by the following
persons in the capacities and as of the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------ --------------------------- -----------------
<S> <C> <C>
/s/ * Timothy A. McGuire Chairman of the Board and January 8, 1999
- ------------------------ Chief Executive Officer
A. Bronson Thayer
/s/ * Timothy A. McGuire Director, President, and January 8, 1999
- ------------------------ Principal Financial Officer
Timothy A. McGuire
/s/ * Timothy A. McGuire Director January 8, 1999
- ------------------------
Monroe E. Berkman
/s/ * Timothy A. McGuire Director January 8, 1999
- ------------------------
John C. Bierley
/s/ * Timothy A. McGuire Director January 8, 1999
- ------------------------
Troy A. Brown, Jr.
Director January _, 1999
- ------------------------
Frank G. Cisneros
Director January _, 1999
- ------------------------
Lawrence H. Dimmitt, III
/s/ * Timothy A. McGuire Director January 8, 1999
- ------------------------
Eric M. Newman
Director January _, 1999
- ------------------------
Chris A. Peifer
</TABLE>
* Pursuant to Power of Attorney filed September 30, 1998, authorizing
A. Bronson Thayer and Timothy A. McGuire, or either of them, as the true
and lawful attorneys-in-fact to sign all amendments to the Form SB-2
Registration Statement.
<PAGE> 78
EXHIBIT INDEX
FORM SB-2
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Numbered Page
-------- --------------
<S> <C>
+* 3.1 Articles of Incorporation and Amended Articles of
Incorporation of Florida Business BancGroup, Inc.
* 3.2 By-Laws of Florida Business BancGroup, Inc.
* 4.1 Specimen Common Stock Certificate.
* 4.2 Specimen Warrant Certificate.
++* 4.3 Escrow Agreement with Independent Bankers'
Bank of Florida.
* 4.4 Warrant Plan.
* 5.1 Opinion of Igler & Dougherty, P.A., regarding
legality of shares.
*10.1 Employment Agreement between the Company
and Timothy A. McGuire.
*10.2 Lease Agreement for Temporary Office.
*10.3 Outsourcing Agreement by and Between Bay Cities Bank and
M&I Data Services
10.4 Lease Agreement for Permanent Office
*21.0 Subsidiaries of Florida Business BancGroup, Inc.
*23.1 Consent of Igler & Dougherty, P.A.
23.2 Consent of Hacker, Johnson, Cohen & Grieb
*24 Power of Attorney
27 Financial Data Schedule
*99.1 Letter to Prospective Investor
+++*99.2 Unit Order Form
</TABLE>
- ---------------------
* Denotes previously EDGAR filed as part of this Registration Statement,
File No. 333-62101.
+ (Incorporated within as Appendix A of Prospectus)
++ (Incorporated within as Appendix B of Prospectus)
+++ (Incorporated within as Appendix C of Prospectus)
<PAGE> 1
EXHIBIT 10.4
10.4
LEASE AGREEMENT FOR PERMANENT OFFICE
<PAGE> 2
CORPORATE CENTER AT INTERNATIONAL PLAZA OFFICE BUILDING
LEASE AGREEMENT
<TABLE>
<S> <C>
LEASE DATE: December 22, 1998.
LANDLORD: Crescent Resources, Inc., a South Carolina corporation
NOTICE Post Office Box 1003 [zip code 28201-1003] (If delivered by mail)
ADDRESS OF 400 South Tryon Street, Suite 1300 [zip code 28202] (If personally
LANDLORD: delivered or overnight service or telegram)
Charlotte, North Carolina
Attention: Robert J. Holmes, Jr. Telephone: (704) 382-8009
Facsimile: (704) 382-6385
TENANT: Bay Cities Bank, Inc., a Florida corporation
NOTICE Austin Center West, Tower II
ADDRESS OF 1408 North Westshore Boulevard, Suite 502
TENANT: Tampa, Florida 33607
Attention: Tim McGuire Telephone: (813) 281-0009
Upon the Commencement Date of the Lease, the Notice
Address of Tenant shall be at the Premises.
TENANT'S
CONTACT
PERSON: Attention: Tim McGuire Telephone: (813) 281-0009
BUILDING: Six (6) story office building known as Crescent Center at
International Plaza located on the Land at the Northwest corner
of the intersection of North Westshore and Spruce Boulevard,
Tampa, Florida.
LAND: That certain tract or parcel of land located in Tampa, Florida,
and described on Exhibit A attached hereto and incorporated
herein by reference.
PREMISES: Suite 100 in the Building, as more particularly described on
Exhibit B attached hereto and incorporated herein by reference.
PREMISES NET
RENTABLE
AREA: Approximately 8,056 square feet located on the first (1st)
floor in the Building.
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
The exact Premises Net Rentable Area shall be determined upon
the completion of the Tenant Improvements Plans and
Specifications referred to in Exhibit "C" attached hereto.
PREMISES NET
USABLE AREA: 7,008 square feet located on the first (1st) floor in the
Building.
The exact Premises Net Usable Area shall be determined upon the
completion of the Tenant Improvements Plans and Specifications
referred to in Exhibit "C" attached hereto.
BUILDING NET
RENTABLE
AREA: 383,694 square feet. The exact Building Net Rentable Area shall
be determined upon the completion of the Building.
LEASE TERM: Five (5) years, beginning on the Commencement Date. Provided,
however, if the Commencement Date is any day other than the
first (1st) a calendar month, the Lease Term shall be extended
automatically until midnight on the last day of the calendar
month in which the Lease Term otherwise would expire.
COMMENCE-
MENT DATE: October 1, 1999.
</TABLE>
<TABLE>
<CAPTION>
BASE RENTAL: Annual Rate Monthly Base
Per Square Foot Rental Amount
Of Premises Based Upon
Net Rentable Area The Annual Rate
----------------- ---------------
<S> <C> <C>
First Year of Lease Term $22.50 $15,105.00
Second Year of Lease Term $22.94 $15,400.38
Third Year of Lease Term $23.45 $15,742.76
Fourth Year of Lease Term $23.94 $16,071.72
Fifth Year of Lease Term $24.45 $16,414.10
</TABLE>
<TABLE>
<S> <C>
ADJUSTMENT
DATE: [Intentionally deleted]
BASIC COSTS
EXPENSE STOP: The Basic Costs shall be Seven and No/100 Dollars ($7.00)
multiplied by the Building Net Rentable Area.
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
PREMISES
ELECTRICAL
EXPENSE STOP: Seventy cents ($.70) multiplied by the Building Net Rentable
Area.
ADVANCE
BASE RENTAL
PAYMENT: Sixteen Thousand One Hundred Twenty-Four and 59/100 Dollars
($16,124.59), which includes sales tax, for the first (1st)
month of the Lease Term.
SECURITY
DEPOSIT: [Intentionally Deleted].
TENANT
IMPROVEMENTS
ALLOWANCE: Twenty-Three and 50/100 Dollars ($23.50) per square foot of
Premises Net Rentable Area.
BROKER: CLW Realty Group, Inc.
The foregoing summary (the "Lease Summary") is hereby incorporated into and
made a part of the Lease Agreement. In the event, however, of a conflict
between the terms of the Lease Summary and the terms of the Lease Agreement,
the latter shall control.
Initial: /s/ JWT (For Landlord)
---------------------
Initial: /s/ TAM (For Tenant)
---------------------
</TABLE>
<PAGE> 5
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PARAGRAPH DESCRIPTION
<S> <C>
1. Definitions........................................................
2. Lease Grant........................................................
3. Lease Term.........................................................
4. Use................................................................
5. Base Rental........................................................
6. Adjustments to Base Rental.........................................
7. Adjustments for Increase in Basic Costs............................
8. Services to Be Furnished by Landlord...............................
9. Construction of Improvements.......................................
10. Maintenance and Repair by Landlord.................................
11. Maintenance and Repair by Tenant...................................
12. Alterations by Tenant..............................................
13. Use of Electrical Services by Tenant...............................
14. Graphics and Signage...............................................
15. Parking............................................................
16. Compliance with Laws...............................................
17. Building Rules and Regulations.....................................
18. Entry by Landlord..................................................
19. Assignment and Subletting..........................................
20. Liens..............................................................
</TABLE>
-i-
<PAGE> 6
<TABLE>
<CAPTION>
<S> <C>
21. Property Insurance.................................................
22. Liability Insurance................................................
23. Indemnities........................................................
24. Waiver and Waiver of Subrogation Rights............................
25. Casualty Damage....................................................
26. Condemnation.......................................................
27. Damages from Certain Causes........................................
28. Events of Default/Remedies.........................................
29. Security Deposit...................................................
30. Peaceful Enjoyment.................................................
31. Holding Over.......................................................
32. Subordination to Mortgage..........................................
33. Estoppel Certificate...............................................
34. Attorneys' Fees....................................................
35. No Implied Waiver..................................................
36. Personal Liability.................................................
37. Notices............................................................
38. Severability.......................................................
39. Recordation........................................................
40. Governing Law and Venue............................................
41. Force Majeure......................................................
42. Time of Performance................................................
</TABLE>
-ii-
<PAGE> 7
<TABLE>
<CAPTION>
<S> <C>
43. Transfers by Landlord..............................................
44. Commissions........................................................
45. Effect of Delivery of this Lease...................................
46. Real Estate Investment Trust.......................................
47. Hazardous Materials................................................
48. Landlord's Right of Relocation.....................................
49. Evidence of Authority..............................................
50. Survival of Obligations............................................
51. Confidentiality....................................................
52. Contractual Landlord's Lien........................................
53. Rent a Separate Covenant...........................................
54. Radon..............................................................
55. Miscellaneous Provisions...........................................
56. Special Stipulations...............................................
57. Waiver of Jury Trial...............................................
EXHIBITS
A Description of Land
B Designation of Premises
C Construction of Improvements
D Cleaning and Janitorial Services
E Rules and Regulations
F Special Stipulations
G Commencement Date Stipulation
H Approved Signage and Drive-Thru Facility
</TABLE>
-iii-
<PAGE> 8
LEASE AGREEMENT
THIS LEASE AGREEMENT (this "Lease") is made and entered into on the
date and between the Landlord and Tenant identified in the Lease Summary.
WITNESSETH:
1. Definitions.
Capitalized terms appearing in this Lease, unless defined elsewhere in this
Lease or in the Lease Summary, shall have these definitions:
(a) "Additional Rent" shall mean all sums of money in addition to Base
Rental which shall become due from Tenant under this Lease, including, without
limitation, Tenant's Proportionate Share of Basic Costs in excess of the Basic
Costs Expense Stop, as set forth in Paragraph 7 herein.
(b) "Adjustment Date" shall have the meaning set forth in the Lease
Summary.
(c) "Advance Base Rental Payment" shall have the meaning set forth in
the Lease Summary.
(d) "Base Rental" during the Lease Term shall be the amount so
designated in the Lease Summary, as same may be adjusted pursuant to the terms
of this Lease, together with all taxes (excise, sales, use or other) levied or
assessed by any governmental entity on Basic Rent, Additional Rent or any other
sums payable by Tenant under this Lease.
(e) "Basic Costs" shall mean and include: all expenses relating to the
Building and the Building Exterior Common Areas, including all costs of
operation, maintenance and management thereof and assessments for public
betterments or improvements, any assessments or fees charged by Concorde Park
Association, Inc. (the "Association"), ad valorem real estate taxes and any
other tax on real estate as such, ad valorem taxes on furniture, fixtures,
equipment or other property used in connection with the operation, maintenance
or management of the Building and the Building Exterior Common Areas and the
costs, including, without limitation, of legal and consulting fees, of
contesting or attempting to reduce any of the aforesaid taxes, reasonable
amortization of capital improvements which are required by applicable law or
which will improve the efficiency of operating, managing or maintaining the
Building or which will reduce Landlord's operating expenses or the rate of
increase thereof, the cost of labor, materials, repairs, insurance, utilities
and services and such other expenses with respect to the operation, maintenance
and management of the Building and the Building Exterior Common Areas, all of
which expenses shall be
-1-
<PAGE> 9
incurred or paid by or on behalf of Landlord or are properly chargeable to
Landlord's operating expenses in accordance with generally accepted accounting
principles as applied to the operation, maintenance and management of a first
class office building.
Notwithstanding the foregoing, it is agreed that the Basic Costs shall
not include: any leasing or marketing or brokerage costs, fees, or commissions;
any cost of upfitting space for occupancy by tenants; any amortization of
principal or interest on account of any indebtedness; any legal expenses
arising out of any misconduct or negligence of Landlord or any person for which
Landlord is responsible or arising out of dealings between any principals
constituting Landlord or arising out of any leasing, sale or financing of the
Building or the Land or any part of either of them; or, except as expressly
permitted above, any amortization or depreciation.
(f) "Basic Costs Expense Stop" shall be the amount so designated in
the Lease Summary.
(g) "Broker" shall be the party or parties so designated in the Lease
Summary.
(h) "Building" shall have the meaning set forth in the Lease Summary.
(i) "Building Exterior Common Areas" shall mean the exterior of the
Building and all of the improvements and real property on the Land, including,
without limitation, all parking areas, enclosed or otherwise, and all streets,
sidewalks, signs and landscaped areas located on or within the Land.
(j) "Building Net Rentable Area" shall have the meaning set forth in
the Lease Summary.
(k) "Building Shell Improvements" shall mean the Building improvements
constructed or to be constructed by Landlord, at Landlord's sole cost and
expense and without applying any of the Tenant Improvements Allowance. The
Building Shell Improvements are more particularly described in Exhibit C
attached hereto and incorporated herein by reference.
(l) "Commencement Date" shall mean that date set forth in the Lease
Summary, as same may be adjusted pursuant to the provisions of Paragraph 3
herein.
(m) "Common Areas" shall mean those areas within the Building devoted
to corridors, elevator foyers, restrooms, mechanical rooms, janitorial closets,
electrical and telephone closets, vending areas and other similar facilities
provided for the common use or benefit of tenants generally and/or the public,
including any columns and/or projections located within said areas.
(n) "Force Majeure Matters" is defined in Paragraph 41 herein.
-2-
<PAGE> 10
(o) "Land" shall mean the real property upon which the Building is
situated as more particularly described on Exhibit A hereto.
(p) "Lease Term" shall mean the term of this Lease as set forth in the
Lease Summary.
(q) "Premises" shall have the meaning set forth in the Lease Summary.
(r) "Premises Electrical Expense Stop" shall have the meaning set
forth in the Lease Summary. The Premises Electrical Expense Stop is the
component of the Basic Cost Expense Stop which covers the cost of electricity
to be supplied to premises in the Building to be occupied by tenants (including
the Premises) (i) to operate lights and light fixtures therein, (ii) to operate
equipment and fixtures that are connected to electrical outlets therein and
(iii) to operate any HVAC system or unit that exclusively serves such tenant
premises (or any portion thereof).
(s) "Premises Net Rentable Area" shall have the meaning set forth in
the Lease Summary.
(t) "Premises Net Usable Area" shall have the meaning set forth in the
Lease Summary.
(u) "Tenant Improvements" shall mean the improvements to be
constructed and installed in the Premises (beyond the Building Shell
Improvements) and the Drive-Thru Facility (as hereinafter defined) in
accordance with the Tenant Improvements Plans and Specifications, the terms of
Paragraph 9 herein and Exhibit C attached hereto.
(v) "Tenant Improvements Allowance" shall mean the allowance to be
provided by Landlord to Tenant for the design, space planning and construction
of the Tenant Improvements. The amount of the Tenant Improvements Allowance is
set forth in the Lease Summary.
(w) "Tenant Improvements Plans and Specifications" shall mean the
plans and Specifications" for the construction of the Tenant Improvements,
which plans and specifications shall be prepared pursuant to Exhibit C attached
hereto.
(x) "Tenant's Proportionate Share" means that fraction, the numerator
of which is the Premises Net Rentable Area and the denominator of which is the
Building Net Rentable Area.
2. Lease Grant.
Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, upon and subject to the covenants, agreements, provisions and
conditions of this Lease, the Premises located in the Building.
-3-
<PAGE> 11
3. Lease Term.
This Lease shall continue in force during a period beginning on the
Commencement Date and continuing until the expiration of the Lease Term, unless
this Lease is sooner terminated or extended to a later date under any other
term or provision herein. Subject to delays resulting from Force Majeure
Matters or delays caused by Tenant or Tenant's agents, employees, contractors,
subcontractors or licensees, including, without limitation, change orders to
the Tenant Improvements Plans and Specifications ("Tenant Delay Factors"),
Landlord will do its best efforts to deliver the Premises to Tenant not later
than the Commencement Date set forth in the Lease Summary (the "Target
Commencement Date"), with the Tenant Improvements substantially completed in
accordance with the Tenant Improvements Plans and Specifications, as evidenced,
if requested by Tenant, by a certificate of substantial completion issued by
Landlord's architect or other designated engineering representative. If
Landlord for any reason whatsoever cannot deliver possession of the Premises to
Tenant (with the Tenant Improvements substantially completed in accordance with
the Tenant Improvements Plans and Specifications) not later than the Target
Commencement Date, this Lease shall not be void or voidable nor shall Landlord
be liable to Tenant for any loss or damage resulting therefrom; but in that
event, Landlord shall act diligently and in good faith to complete the work
that is necessary to allow Landlord to deliver the Premises to Tenant as
specified above. In such case, (a) if Landlord's failure to deliver possession
of the Premises to Tenant (with the Tenant Improvements substantially completed
in accordance with the Tenant Improvements Plans and Specifications) by the
Target Commencement Date is not the result, in whole or in part, of one or more
Tenant Delay Factors, the Commencement Date shall be adjusted to be the date
when Landlord does in fact deliver possession of the Premises to Tenant as
described above and (b) if Landlord's failure to deliver possession of the
Premises to Tenant (with the Tenant Improvements substantially completed in
accordance with the Tenant Improvements Plans and Specifications) by the Target
Commencement Date is the result, in whole or in part, of one or more Tenant
Delay Factors, the Commencement Date shall be the later of (i) the Target
Commencement Date or (ii) the date the Tenant Improvements would have been
substantially completed in the absence of such Tenant Delay Factors(s).
Notwithstanding the foregoing, if for any reason other than Force Majeure
Matters or Tenant Delay Factors, Landlord cannot deliver possession of the
Premises (with the Tenant Improvements substantially completed in accordance
with the Tenant Improvements Plans and Specifications) to Tenant by October 1,
2000, Tenant shall be entitled to terminate this Lease by so notifying Landlord
in writing not later than October 10, 2000. Time is of the essence relative to
Tenant's right to terminate this Lease pursuant to this Paragraph 3 and in the
event that Tenant fails to deliver the notice of termination to Tenant by
October 10, 2000, Tenant shall have no further right to terminate this Lease.
In the event that the Building is substantially completed and a
certificate of occupancy for the shell of the Building has been issued by all
appropriate governmental entities, Tenant shall be entitled to take early
occupancy of the Premises on or after August 15, 1999. In the event that Tenant
occupies the Premises prior to the Commencement Date, all terms and conditions
applicable to Tenant under this Lease shall be enforceable against Tenant,
except that Tenant shall not be obligated to pay for Base Rental.
-4-
<PAGE> 12
If, for any reason other than Force Majeure Matters or Tenant Delay
Factors, Landlord cannot deliver possession of the Premises (with the Tenant
Improvements substantially completed in accordance with the Tenant Improvements
Plans and Specifications) to Tenant by October 1, 1999, Landlord shall pay a
per day penalty equal to two (2) days rental amount due under this Lease for
each day after October 1, 1999 that the Landlord cannot deliver possession of
the Premises (with the Tenant Improvements substantially completed in
accordance with the Tenant Improvements Plans and Specifications.
Within five (5) days following Tenant's occupancy of the Premises,
Tenant shall execute and deliver to Landlord duplicate originals of a
stipulation in the form attached to this Lease as Exhibit G (with the blanks
properly completed). Subject to Landlord's approval of the information inserted
by Tenant in the blanks, Landlord shall execute the duplicate originals of the
stipulation and shall promptly return one (1) fully executed original to
Tenant.
4. Use.
The Premises shall be used for a retail bank and for no other
purposes. Tenant agrees not to use or permit the use of the Premises for any
purpose that is illegal or is in violation of any applicable legal,
governmental, quasi-governmental or Association requirement, ordinance or rule,
or that, in Landlord's opinion, creates a nuisance, disturbs any other tenant
of the Building or injures the reputation of the Building.
5. Base Rental.
(a) Tenant agrees to pay during the Lease Term to Landlord, without
any setoff or deduction, except as provided herein, the Base Rental, and all
such other sums of money as shall become due hereunder as Additional Rent, all
of which are sometimes herein collectively called "rent" or "Rent." Base Rental
for each calendar year or portion thereof during the Lease Term, together with
any applicable adjustment thereto pursuant to Paragraph 6 herein, shall be due
and payable in advance, in twelve (12) equal installments on the first day of
each calendar month during the Lease Term; provided, however, the Base Rental
for the first (1st) full calendar month during the Lease Term (i.e., the
Advance Base Rental Payment) shall be due and payable upon the full execution
of this Lease. Tenant hereby agrees to pay such Base Rental and any adjustments
thereto to Landlord at Landlord's address provided herein (or such other
address as may be designated by Landlord in writing from time to time) monthly,
in advance, and without demand. If the Lease Term commences on a day other than
the first day of a month or terminates on a day other than the last day of a
month, then the installments of Base Rental and any adjustments thereto for
such month or months shall be prorated, based on the number of days in such
month or months.
(b) Upon the execution of this Lease, Tenant has paid to Landlord the
Advance Base Rental Payment as additional security for Tenant's performance of
its obligations under this Lease. If Tenant is not then in default under this
Lease, Landlord shall apply the Advance Base Rental
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<PAGE> 13
Payment to the payment of the monthly installment of Base Rental due relative
to the first (1st) full calendar month during the Lease Term. If Tenant is then
in default under this Lease, Landlord may, at its option, apply all or any part
of the Advance Base Rental Payment to cure the default. With regard to the
first (1st) full calendar month during the Lease Term and with regard to any
partial calendar month (if any) preceding the first full calendar month during
the Lease Term, Tenant shall pay its monthly installment of Base Rental (or the
prorate portion thereof) in a timely manner pursuant to Paragraph 5(a) herein.
6. Adjustments to Base Rental. [Intentionally deleted].
7. Adjustments for Increase in Basic Costs.
With respect to each calendar year or portion thereof during the Lease
Term (and any renewal or extension thereof), Tenant shall pay Landlord as
Additional Rent, in the manner hereafter provided, Tenant's Proportionate Share
of the amount by which Basic Costs paid or incurred by Landlord during such
period (grossed up, if necessary, to reflect occupancy of ninety-five percent
(95%) of the rentable space in the Building) exceeded the Basic Costs Expense
Stop (the "Excess Basic Costs"). References in this Paragraph 7 to "Basic
Costs" shall be deemed and construed to refer to Basic Costs as grossed up
pursuant to the immediately preceding sentence. If Tenant shall be obligated to
make payments as aforesaid with regard to any partial calendar year during the
Lease Term, the Excess Basic Costs shall be prorated on the basis of the number
of days during such calendar year for which Tenant is obligated to make such
payments.
It is acknowledged and agreed that it will not be possible to
determine the actual amount of the Excess Basic Costs (if any) for a given
calendar year until after the end of such calendar year. Therefore, until
Tenant's liability for Tenant's Excess Basic Costs shall have been finally
determined for a particular calendar year, Tenant shall make payment on account
of Excess Basic Costs as follows:
(a) Commencing as of the Commencement Date and continuing throughout
the Lease Term (and any renewal or extension thereof), and subject to the
limitation expressed above, Landlord shall make a good faith estimate of Basic
Costs for such calendar year and Tenant's Proportionate Share thereof
(hereinafter "Estimated Basic Costs" and "Tenant's Estimated Excess Basic
Costs"), and Tenant shall pay to Landlord, as Additional Rent with each monthly
installment of Base Rental, an amount equal to one-twelfth (1/12) of Tenant's
Estimated Excess Basic Costs. Such payments for any partial month shall be paid
in advance at the daily rate equal to the monthly payment divided by the number
of days in the month for which the same is due. On or about January 1 of each
calendar year in respect of which Tenant shall be obligated to make payments on
account of Excess Basic Costs during the Lease Term (and any renewal or
extension thereof), Landlord shall furnish to Tenant a statement for such
calendar year of Tenant's Estimated Excess Basic Costs and thereupon, subject
to the limitations expressed above, as of such January 1, Tenant shall make
payments under this Paragraph 7(a) in accordance with such statement.
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<PAGE> 14
(b) On or before April 1 in the year following the year in which the
Commencement Date occurs and each April 1 thereafter during the Lease Term (and
any renewal or extension thereof), Landlord shall furnish Tenant with a
statement setting forth the total amount of Excess Basic Costs for the
preceding calendar year. If any such statement shall show an overpayment or
underpayment of the Excess Basic Costs for the preceding calendar year, any
overpayment shall be refunded to Tenant or credited against payments due from
Tenant under this Lease, and the full amount of any underpayment shall be paid
to Landlord by Tenant not later than the first (1st) day of the first (1st)
calendar month after such statement shall have been delivered to Tenant.
(c) In the event Tenant is required to pay Excess Basic Costs pursuant
to this Paragraph 7, Tenant shall have the right, at Tenant's expense and no
more frequently than once per calendar year, to inspect Landlord's books and
records showing Basic Costs of the Building for the calendar year in question;
provided, however, Tenant shall not have the right to withhold any payments of
Excess Basic Costs due and payable hereunder the amount of which may be in
dispute, and Tenant must pay the entire amount due and payable hereunder prior
to reviewing Landlord's books and records. In the event Tenant's inspection of
Landlord's books and records reveals a verifiable error in Landlord's
computation of Excess Basic Costs resulting in an overpayment by Tenant of
Excess Basic Costs (after allowing for any adjustment pursuant to Paragraph
7(b) herein), Landlord shall promptly reimburse the amount of such overpayment
to Tenant, together with interest thereon from the date of overpayment until
the date of reimbursement at a rate per annum equal to one percent (1%) plus
the Prime Rate (as defined herein) in effect as of the date of overpayment. As
used in this Lease, the "Prime Rate" shall be deemed to be that rate of
interest announced by NationsBank, N.A., or any successor thereto, from time to
time as its "prime rate," and Landlord and Tenant acknowledge and understand
that NationsBank, N.A., lends at rates of interest both above and below the
Prime Rate. Landlord's statement setting forth the total amount of Excess Basic
Costs furnished to Tenant in accordance with the provisions of this Paragraph 7
shall be deemed to have been approved by Tenant unless protested by Tenant in
writing within ninety (90) days after delivery of such statement to Tenant at
the Premises.
Notwithstanding the foregoing provisions of this Paragraph 7, the
Excess Basic Costs (excluding taxes, insurance premiums and utilities) for the
calendar year 1999 shall not exceed five percent (5%) Basic Costs Expense Stop
(excluding taxes, insurance premiums and utilities). For each calendar year
thereafter, the Excess Basic Costs (excluding taxes, insurance premiums and
utilities) shall not exceed one hundred five percent (105%) of the Excess Basic
Costs (excluding taxes, insurance premiums and utilities) for the previous
calendar years.
8. Services to Be Furnished by Landlord.
Landlord agrees to furnish Tenant the following services:
(a) Hot and cold water at those points of supply provided for general
use of other tenants in the Building.
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<PAGE> 15
(b) Except with regard to any HVAC system or unit that exclusively
serves the Premises (or any portion thereof), which shall be Tenant's
responsibility pursuant to Paragraph 11(b) herein, Landlord shall furnish
central heat and air conditioning sufficient for the comfortable occupancy of
the Premises. Provided, however, central heating and air conditioning service
at times other than for "Normal Business Hours" for the Building (which are
8:00 a.m. to 6:00 p.m. on Mondays through Fridays and 8:00 a.m. to 1:00 p.m. on
Saturdays, exclusive of normal business holidays), shall be furnished only on
the written request of Tenant delivered to Landlord on the following schedule:
(1) For evenings Monday through Friday - prior to 3:00 p.m. on the
day when such service is required;
(2) For Saturday afternoon, Saturday evening and Sunday - prior to
3:00 p.m. on Friday; and
(3) For normal business holidays - prior to the times set forth
above for the last day prior to such holiday.
Tenant shall bear the entire cost (as Additional Rent) of such additional
heating and air conditioning used by Tenant at times other than Normal Business
Hours, and Tenant shall pay such costs within ten (10) days following demand by
Landlord. The cost to be charged by Landlord to Tenant hereunder for heating
and air conditioning service used by Tenant during times other than Normal
Business Hours shall be $30.00 per hour, subject to increases in such hourly
rate from time to time during the Lease Term to reimburse Landlord for
increases in the cost to Landlord of electricity consumed in providing the
heating and air conditioning service.
If heat-generating machines or equipment shall be used in the Premises
by Tenant which affect the temperature otherwise maintained by the Building
HVAC system, Landlord shall have the right (at Landlord's option) to install
(or to require Tenant to install) one or more HVAC systems or units that
exclusively serve the Premises (or the portion thereof where such
heat-generating machines or equipment are located). As set forth in Paragraph
11(b) herein, the cost of any such separate HVAC systems or units that
exclusively serve the Premises, including the cost of installation and the cost
of operation and maintenance thereof, shall be borne by Tenant.
(c) Electrical service to serve the Common Areas and the Premises,
subject to the terms of Paragraph 13 herein.
(d) Routine maintenance and electric lighting service for all Common
Areas of the Building in the manner and to the extent deemed by Landlord to be
standard.
(e) Janitorial service, in accordance with the schedule attached
hereto as Exhibit D, Mondays through Fridays, exclusive of normal business
holidays; provided, however, if Tenant's
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<PAGE> 16
floor covering or other improvements require special treatment, Tenant shall
pay the additional cleaning cost attributable thereto as Additional Rent upon
presentation of a statement therefor by Landlord.
(f) All Building standard fluorescent and incandescent light bulb
replacement in the Common Areas and all light bulb replacement in the Premises.
Provided, however, Tenant shall promptly pay to Landlord, as Additional Rent,
costs incurred by Landlord in replacing light bulbs in the Premises (including
the cost of purchasing such light bulbs) if and to the extent such replacement
cost exceeds the replacement cost for Building standard light bulbs. As used
herein, "Building standard light bulbs" shall be deemed to refer to 2' x 4', 3
lamp F40/CW with energy saving ballasts.
(g) Tenant, its employees, and its invitees who have been registered
with Landlord shall have access to the Premises (including elevator service) by
a code or card access system seven (7) days a week, twenty-four (24) hours a
day. Tenant shall receive an allotment of codes or cards for all of its
employees and for its invitees who are registered with Landlord. Landlord shall
bear the cost of each such code or card initially issued, provided Tenant shall
pay to Landlord (as Additional Rent, within thirty (30) days after Tenant
receives an invoice therefor) the actual costs incurred by Landlord in
obtaining and issuing replacement codes or cards for codes or cards previously
issued. Landlord, however, shall have no liability to Tenant, its employees,
agents, invitees or licensees for losses due to theft or burglary or for
damages done by unauthorized persons on the Premises, and Landlord shall not be
required to insure against any such losses. Tenant shall cooperate fully with
Landlord's efforts to maintain security in the Building during times other than
Normal Business Hours and shall follow all regulations promulgated by Landlord
with respect thereto.
The failure by Landlord to any extent to furnish, or the interruption
or termination of these defined services in whole or in part, resulting from
any Force Majeure Matters or from any other causes shall not (i) render
Landlord liable in any respect, (ii) be construed as an eviction of Tenant,
(iii) work an abatement of rent, or (iv) relieve Tenant from the obligation to
fulfill any covenant or agreement in this Lease. Should any of the equipment or
machinery used in the provision of such services for any cause cease to
function properly, Tenant shall have no claim for offset or abatement of rent
or damages on account of an interruption in service resulting therefrom.
Amounts payable pursuant to this Paragraph 8 shall be deemed to be Additional
Rent due from Tenant to Landlord, and any default in the payment thereof shall
entitle Landlord to all remedies provided for herein at law or in equity on
account of Tenant's failure to pay Base Rental.
Notwithstanding the foregoing, in the event that there is a failure of
services for which Landlord is responsible to perform which is not the result
of Force Majeure Matters and which renders the Premises untenantable for five
(5) consecutive days, Tenant shall be entitled to give Landlord written notice
of such event. In the event that Landlord fails to cure such failure within
five (5) days from receipt of such written notice, Tenant shall be entitled to
cure such failure and bill Landlord for the reasonable out-of-pocket costs of
Tenant in effecting such cure.
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<PAGE> 17
9. Construction of Improvements.
(a) Subject to Force Majeure Matters and consistent with the terms of
Paragraph 3 herein and Exhibit C hereto, Landlord shall pursue diligently and
in good faith the completion of the Building Shell Improvements and the Tenant
Improvements.
(b) The Tenant Improvements Allowance shall be applied by Landlord
against the costs of designing, planning and constructing the Tenant
Improvements. In the event the costs incurred in connection with the design,
planning and construction of the Tenant Improvements exceed the Tenant
Improvements Allowance, Tenant shall be responsible for bearing and paying such
excess costs (the "Excess Costs"), as follows:
(1) Tenant shall pay to Landlord, prior to the commencement of
construction of the Tenant Improvements, an amount equal to fifty
percent (50%) of such Excess Costs (as then estimated by Landlord).
(2) After substantial completion of the Tenant Improvements but
prior to occupancy of the Premises by Tenant, Tenant shall pay to
Landlord an amount equal to ninety percent (90%) of the Excess Costs
(as then estimated by Landlord), less payments received by Landlord
pursuant to Paragraph 9(b)(1) herein.
(3) As soon as the final accounting is prepared and submitted by
Landlord to Tenant, Tenant shall pay to Landlord the entire unpaid
balance of the actual Excess Costs based on the final costs to
Landlord.
The Excess Costs (if any) payable by Tenant under this Paragraph 9(b) shall
constitute Additional Rent due hereunder at the time specified herein, and
failure to make any such payment when due shall constitute a default of Tenant
under Paragraph 28 herein. In the event the cost to complete the Tenant
Improvements is less than the Tenant Improvements Allowance, Landlord will
contribute such savings toward the payment of Tenant's actual reasonable moving
expenses, including but not limited to actual costs for moving, cabling,
telephone switcher and furniture.
(c) Except as otherwise provided above in this Paragraph 9, all
installations and improvements now or hereafter placed on or in the Premises
shall be for Tenant's account and at Tenant's cost. Tenant shall also pay ad
valorem taxes and increased insurance on or attributable to the Tenant
Improvements (to the extent of the cost of the Tenant Improvements is in excess
of the Tenant Improvements Allowance), which cost shall be payable by Tenant to
Landlord as Additional Rent.
(d) If requested by Tenant at the beginning of the sixth (6th)
calendar year of the Lease Term, Landlord will provide Tenant with a
refurbishment allowance to paint and recarpet the Premises with comparable cost
and materials as provided in the initial Tenant Improvements.
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<PAGE> 18
10. Maintenance and Repair by Landlord.
Except to the extent any such repairs or replacements are the
responsibility of Tenant pursuant to the terms of Paragraph 11 or Paragraph 12
herein or any other provision in this Lease, Landlord shall be responsible for
maintaining, repairing and replacing:
(a) the roof, foundations, exterior walls, and all structural parts of
the Building;
(b) all portions of the Premises affected by structural conditions
whose source lies outside the Premises;
(c) all Common Areas and Building Exterior Common Areas;
(d) all utility, sprinkler service, electrical and plumbing lines and
HVAC systems outside the Premises but which serve the Premises on a
non-exclusive basis; and
(e) all utility, sprinkler service, electrical and plumbing lines and
HVAC systems within the Premises but which serve other space within the
Building.
Except as expressly provided herein, Landlord shall not be required to
make any repairs to the Premises or the Building.
11. Maintenance and Repair by Tenant.
In addition to any other provisions in this Lease which obligate
Tenant to perform maintenance, repair and replacement duties relative to the
Premises and/or the Building, Tenant shall be responsible for the following
maintenance, repair and replacement responsibilities:
(a) Tenant shall, at its expense, keep and maintain the Premises in
good order and repair and not commit or allow any waste to be committed on any
portion of the Premises; and at the termination of this Lease, Tenant agrees to
deliver up the Premises to Landlord in as good of a condition as existed on the
Commencement Date, excepting only ordinary wear and tear, acts of God and
repairs required to be made by Landlord pursuant to the terms of this Lease.
(b) Tenant shall, at its expense, keep and maintain all HVAC systems
and units, appliances and equipment that exclusively serve he Premises (or any
portion thereof). In the event the Premises (or any portion thereof) is
exclusively served by an HVAC system or unit, Tenant shall contract with a
qualified heating and air conditioning service company approved by Landlord for
the monthly maintenance and the repair and replacement, as necessary, of such
HVAC system or unit. Tenant shall provide Landlord with a copy of any contract
required under this Paragraph 11(b) within ten (10) days after the Commencement
Date and a copy of any subsequent contracts (or any renewal contracts) within
ten (10) days after their execution. The cost of all contracts which Tenant is
required to maintain under this Paragraph 11(b) shall be borne by Tenant.
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<PAGE> 19
(c) Tenant shall, at Tenant's own cost and expense, repair or replace
any damage done to the Common Areas, the Building Exterior Common Areas, the
Building, or any part thereof (including the Premises), caused by Tenant or
Tenant's agents, employees, invitees, or visitors, and such repairs shall
restore the damaged area to as good of a condition as existed prior to such
damage and shall be effected in compliance with all applicable laws; provided,
however, if, within a reasonable period following written notice from Landlord
of the need for such repairs or replacements, Tenant fails to make such repairs
or replacements promptly, Landlord may, at its option, make the repairs or
replacements, and Tenant shall pay the cost thereof to Landlord on demand as
Additional Rent.
12. Alterations by Tenant.
Tenant shall not make or allow to be made any alterations to the
Premises or install any vending machines in the Premises, without first
obtaining the written consent of Landlord in each such instance. Any and all
alterations to the Premises shall become the property of Landlord upon the
termination of this Lease (except for movable equipment or furniture owned by
Tenant). Landlord may, by written notice to Tenant not later than sixty (60)
days prior to termination, require Tenant, upon the expiration or earlier
termination of this Lease, to remove any and all fixtures, equipment and other
improvements installed in the Premises by Tenant. In the event that Landlord so
elects and Tenant fails to remove such improvements, Landlord may remove such
improvements at Tenant's cost, and Tenant shall pay Landlord on demand the cost
of restoring any damage to the Premises resulting from such removal, excepting
only ordinary wear and tear and acts of God.
13. Use of Electrical Services by Tenant.
Landlord will install an electrical check meter (a "Check Meter ") for
the Premises as part of the Tenant Improvements. It is anticipated that the
Check Meter will measure all electricity supplied to the Premises (i) to
operate lights and light fixtures therein, (ii) to operate equipment and
fixtures that are connected to electrical outlets therein and (iii) to operate
any HVAC system or unit that exclusively serves the Premises (or any portion
thereof). As contemplated in Paragraph 8(c) herein, Landlord shall pay the
local electrical utility company prior to delinquency for the electricity
supplied to the Premises through the Check Meter. Provided, however, in the
event the amount paid by Landlord to the local electrical utility company for
electricity supplied to the Premises (as measured by the Check Meter) for any
given period of time is greater than the allocable portion of the Premises
Electrical Expense Stop (allocated to the Premises for the relevant period of
time), Landlord may submit an invoice to Tenant periodically for the cost of
such excess electricity supplied to the Premises and Tenant shall pay the full
invoiced amount (as Additional Rent) to Landlord within ten (10) days after
Tenant's receipt of each such invoice. The following formula shall be used to
determine the invoice amount for Tenant's excess electrical usage in the
Premises:
Invoice Amount = Total Electrical Costs Per Check Meter - [(Tenant's
Proportionate Share x Premises Electrical Expense
Stop) x (Number of Days in Period ) Number of Days
in Year)]
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<PAGE> 20
For example, presuming (for purposes of this illustration only) that the
Premises Net Rentable Area is 10,000 square feet, that the Check Meter
indicates $2,000.00 of electricity was supplied to the Premises during a given
90-day period and that the calendar year in which such 90-day period falls
contains 365 days, Landlord shall be entitled hereunder to send an invoice to
Tenant in the amount of $321.28 for excess electrical usage in the Premises
during such 90-day period, computed as follows:
Invoice Amount = $2,000.00 - [.025 x $272,300.00) x (90 ) 365)]
= $2,000.00 -[$6,807.50 x .2466]
= $2,000.00 - $1,678.73
= $321.27
In computing invoices to be sent to Tenant for electricity supplied to the
Premises through the Check Meter, Landlord shall use the same billing rate and
structure as used by the local electrical utility company. Additionally, with
regard to any period of time that Landlord elects to use a Check Meter to bill
Tenant for excess electricity supplied to the Premises, Landlord also shall use
a Check Meter to bill other tenants in the Building for excess electricity
supplied to their respective premises; and in such case, the cost of
electricity supplied to the Premises and to other premises in the Building for
which Landlord separately bills Tenant and other tenants in the Building (i.e.
such electrical costs that exceed the Electrical Expense Stop) shall not be
included in Basic Costs hereunder, Landlord shall be entitled to bill Tenant
pursuant to this Paragraph 13 for excess electrical usage in the Premises
monthly, quarterly, annually or otherwise, as determined by Landlord from time
to time during the Lease Term.
14. Graphics and Signage.
All letters and numerals on doors or other signs on the Premises shall
be in the standard form of graphics for the Building, and no others shall be
used or permitted without Landlord's prior written consent. Furthermore, Tenant
shall not place signs on or in the Premises which are visible from outside the
Premises. Landlord has approved the signs for the Building ATM machine, the
Eyebrow Sign on the Building and the Drive-Thru Banking and ATM all as shown on
Exhibit "H" attached hereto (the "Landlord Approved Signage"). Tenant's name
and suite number shall be included by Landlord on the lobby directory for the
Building. On or before January 31, 1999 (the "Tenant Signage Approval Period"),
Landlord and Tenant shall agree upon the size, location, type and appearance of
monument signage, that will contain Tenant's name, along with other tenants
names, to be constructed as part of the overall signage for the Building and
pylon signs for Tenant containing Tenant's name in size and location acceptable
to Tenant (collectively, the "Tenant Signage"). Tenant shall pay all costs
associated with Tenant Signage, except that Landlord shall pay the cost for any
monument sign associated with the Building. Tenant acknowledges that the
Landlord Approved Signage and the Tenant Signage are subject to
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<PAGE> 21
the approval of various entities that have approval rights with respect to
improvements constructed at International Plaza (the "Other Approvals"). Upon
agreement as to the Tenant Signage, Landlord will then attempt to obtain such
Other Approvals for the Landlord Approved Signage and the Tenant Signage. In
the event that Landlord and Tenant cannot agree to the Tenant Signage or
Landlord is not able to obtain the Other Approvals for the Landlord Approved
Signage and the Tenant Signage all on or before January 31, 1999, Tenant shall
have the right to terminate this Lease.
Landlord hereby agrees that, during the Lease Term, the Landlord will
not name the Building for a retail bank and the name of a retail bank will not
appear on the exterior of the Building. Tenant acknowledges that other signage
associated with the Building may contain the name of a retail bank.
15. Parking.
During the Lease Term, Tenant shall have, without charge, the
non-exclusive right to use, in common with Landlord, other tenants of the
Building, and their respective guests and invitees, the automobile parking
areas, driveways, and footways located on the Land. Notwithstanding the terms
and provisions in the immediately preceding sentence, (i) Tenant and Tenant's
guests and invitees shall not, at any given time, be entitled to use more than
five (5) parking spaces for each 1,000 square feet of Premises Net Useable
Area, and (ii) Landlord shall have the right during the Lease Term to reserve
parking spaces on the Land for the exclusive use of other tenants in the
Building, provided the reservation of such spaces for the exclusive use of
other tenants in the Building does not have the effect of denying Tenant the
non-exclusive use of five (5) parking spaces for each 1,000 square feet of
Premises Net Rentable Area. As part of the five (5) parking spaces per 1,000
square feet of Premises Net Useable Area, Landlord will provide Tenant with
eight (8) reserved parking spaces in the surface parking lot located at the
north end of the Westshore wing of the Building as close to the entry doors as
allowed by applicable governmental regulations at no additional cost to Tenant,
which shall be labeled "Bay Cities Bank Visitors" and two (2) additional
reserved parking spaces for employees of Tenant in the parking garage
associated with the Building.
16. Compliance with Laws.
Tenant agrees to comply with all applicable laws, ordinances, rules
and regulations of the Association or any governmental entity or agency having
jurisdiction over the Premises. Without limiting the generality of the
foregoing, in the event the Premises must be modified or any other action
relating to the Premises must be undertaken in the future to comply with the
Americans With Disabilities Act or any similar federal, state or local statute,
law, or ordinance, the responsibility for such modification or action
(including the payment of all costs incurred in connection therewith) shall
belong to Tenant. If the Common Areas or the Building Exterior Common Areas
must be modified or any other action relating to the Common Areas or the
Building Exterior Common Areas must be undertaken in the future to comply with
the Americans
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<PAGE> 22
With Disabilities Act or any similar federal, state or local statute, law, or
ordinance and if such modification or action is required because of (i) any
special or unique use or activity in the Premises or (ii) the performance of
any alterations within the Premises, the responsibility for such modification
or action (including the payment of all costs incurred in connection therewith)
shall belong to Tenant. Except as provided in the immediately preceding
sentence, in the event the Common Areas or the Building Exterior Common Areas
must be modified or any other action relating to the Common Areas or the
Building Exterior Common Areas must be undertaken in the future to comply with
the Americans With Disabilities Act or any similar federal, state or local
statute, law, or ordinance, the responsibility for such modification or action
(including the payment of all costs incurred in connection therewith, subject
to the terms and provisions of this Lease relating to the pass-through of Basic
Costs) shall belong to Landlord.
17. Building Rules and Regulations.
Tenant shall comply with the rules and regulations applicable to the
Building and the Building Exterior Common Areas (the "Rules and Regulations")
adopted and altered by Landlord from time to time and shall cause all of its
agents, employees, invitees and visitors to do so; all changes to the Rules and
Regulations will be sent by Landlord to Tenant in writing. The initial Rules
and Regulations, which have been reviewed and approved by Tenant, are attached
hereto as Exhibit E.
18. Entry by Landlord.
Tenant agrees to permit Landlord and Landlord's agents and
representatives to enter into and upon any part of the Premises at all
reasonable hours (and in emergencies at all times) to inspect the same, to show
the Premises to prospective purchasers, mortgagees, tenants or insurers, to
install or maintain Check Meters and other devices to determine if Tenant's
electrical usage is in excess of design loads and capacities, and to clean or
make repairs, alterations or additions thereto, and Tenant shall not be
entitled to any abatement or reduction of rent by reason thereof.
19. Assignment and Subletting.
(a) Tenant shall not assign this Lease or sublet all or any part of
the Premises or make any other transfer of its interest in the whole or any
portion thereof, directly or indirectly, at any time during the Lease Term
without the prior written consent of Landlord, which such consent shall not be
unreasonably withheld. Any attempted assignments, subleases or other transfers
by Tenant in violation of the terms and conditions of this Paragraph 19(a)
shall be null and void. In the event that Tenant desires at any time to assign
this Lease or sublet all or any part of the Premises, Tenant shall submit to
Landlord at least thirty (30) days prior to the proposed effective date of the
assignment or sublease, in writing, (i) a request for permission to assign or
sublet setting forth the proposed effective date which shall be no less than
thirty (30) days after the sending of such notice; (ii) the name of the
proposed subtenant or assignee or other party; (iii) the nature of the business
to be carried on in the Premises after the assignment or sublet; (iv) the terms
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and provisions of the proposed assignment or sublet; and (v) current financial
statements of the proposed subtenant or assignee; and such additional
information that Landlord may reasonably request in order to make a reasoned
judgment. Notwithstanding the foregoing, Landlord consent shall not be required
for an assignment or sublease to a successor of Tenant resulting from a merger,
consolidation, sale or acquisition of all of the stock of Tenant, provided that
such resulting entity is of equal or better creditworthiness as Tenant and
Tenant continues to be primarily liable under the Lease, or a sublease to a
wholly-owned affiliate or subsidiary of Tenant and Tenant continues to be
primarily liable under the Lease.
(b) If Tenant requests Landlord's consent to an assignment of this
Lease or subletting of all of the Premises, or any other transfer of its
interest(s), Landlord shall have the option (without limiting Landlord's other
rights hereunder) of terminating this Lease with respect to the entire Premises
subject to the proposed assignment, subletting or transfer upon fifteen (15)
days' notice and of dealing directly with the proposed assignee, subtenant or
transferee. If Landlord should fail to notify Tenant in writing of its decision
within a fifteen (15) day period after Landlord is notified in writing of the
proposed assignment, sublease or other transfer, Tenant shall give a second
notice to Landlord, and in the event that Landlord should fail to notify Tenant
of it decision within ten (10) days after receipt of the second notice,
Landlord shall be deemed to have elected to keep this Lease in full force and
effect.
(c) All cash or other proceeds of any assignment, sale, sublease or
other transfer of Tenant's interest in this Lease, whether consented to by
Landlord or not, shall be paid to Landlord notwithstanding the fact that such
proceeds exceed the rentals called for hereunder, unless Landlord agrees to the
contrary in writing, and Tenant hereby assigns all rights it might have or ever
acquire in any such proceeds to Landlord. This covenant and assignment shall
run with the land and shall bind Tenant and Tenant's heirs, executors,
administrators, personal representatives, successors and assigns. Any assignee,
subtenant or purchaser of Tenant's interest in this Lease (all such assignees,
subtenants and purchasers being hereinafter referred to as "Successors"), by
assuming Tenant's obligations hereunder, shall assume liability to Landlord for
all amounts paid to persons other than Landlord by such Successor in
consideration of any such sale, assignment or subletting, in violation of the
provisions herein. Landlord hereby reserves the right to condition Landlord's
consent to any assignment or sublet upon Landlord's receipt from Tenant of a
written agreement, in form and substance acceptable to Landlord, pursuant to
which Tenant shall pay over to Landlord fifty percent (50%) of all rent or
other consideration received by Tenant from any such subtenant or assignee,
either initially or over the term of the assignment or sublease, in excess of
the Rent called for hereunder, or, in case of the sublease of a portion of the
Premises, in excess of such rent fairly allocable to such portion, after
appropriate adjustments to assure that all other payments called for hereunder
are taken into account, and after taking into account Tenant's reasonable
expenses incurred in connection with such subletting or assignment.
(d) If Tenant assigns, sublets or makes any other transfer of all or
any portion of its interest(s) hereunder, Tenant named in this Lease shall
remain directly and primarily responsible for the faithful performance and
observance of all of the covenants and obligations on Tenant's
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part to be performed in this Lease. No assignment or subletting shall affect
the continuing primary liability of Tenant hereunder (which, following any
assignment or sublet, shall be joint and several with the assignee or
subtenant), and Tenant shall not be released from performing any of the terms,
covenants and conditions of this Lease.
(e) Any assignee or subtenant hereunder shall be bound by and shall
comply with all of the terms and provisions in this Lease, including, without
limitation, the use restriction set forth in Paragraph 4 herein. As a condition
to the effectiveness of any assignment that is permitted hereunder, the
assignee shall, by an instrument in writing, assume and agree to perform (for
the express benefit of Landlord) the terms hereof; and as a condition to the
effectiveness of any sublease that is permitted hereunder, the subtenant shall
acknowledge in writing (for the express benefit of Landlord) the existence of
this Lease and shall covenant not to do or permit to be done anything that
would constitute a breach hereof.
(f) Landlord's consent to any one assignment, sublease or other
transfer hereunder shall not waive the requirement of its consent to any
subsequent assignment, sublease or other transfer as required herein.
(g) Tenant shall not advertise its space for assignment or subletting
at a rental rate lower than the rental schedule established from time to time
by Landlord for comparable space in International Plaza for a comparable term
in the Building or in any other building owned by Landlord in International
Plaza. Further, no assignment or subletting shall be made: (i) to any person or
entity which shall at that time be a tenant, subtenant or other occupant of any
part of the Building or any other building owned by Landlord in International
Plaza when Landlord has other comparable space in the Building or in another
building in International Plaza available for leasing by Landlord; (ii) to any
one who dealt with Landlord or Landlord's agent (directly or through a broker)
with respect to space in the Building or in another building in International
Plaza during the six (6) months immediately preceding Tenant's request for
Landlord's consent; (iii) to any person or entity when the Landlord has other
comparable space in the Building or in another building in International Plaza
available for leasing and suitable for use by such proposed tenant; (iv) to any
person or entity for the conduct of business which is not in keeping with the
standards and general character of the Building; (v) which would require the
demolition or reconfiguration of any portion of the Premises or which would
result in the Premises being subdivided into more than two (2) rental units.
All rights and options of Tenant hereunder, if any, to expand the Premises,
contract the Premises, extend or renew the Term, shorten the Term, and any
right of first refusal shall automatically terminate upon the assignment of
this Lease or upon sublet of all or any part of the Premises unless Landlord
specifically agrees in writing that such rights and options shall continue.
Tenant acknowledges that the restrictions on assignments and subleases
described herein are a material inducement for Landlord entering into this
Lease and shall be enforceable by Landlord against Tenant and against any
assignee or subtenant or any other party acquiring an interest in this Lease.
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20. Liens.
Tenant will not permit any mechanic's lien(s) or other liens to be
placed upon the Premises, the Building or the Land and nothing in this Lease
shall be deemed or construed in any way as constituting the consent or request
of Landlord, express or implied, by inference or otherwise, to any person for
the performance of any labor or the furnishing of any materials to the
Premises, or any part thereof, nor as giving Tenant any right, power or
authority to contract for or permit the rendering of any services or the
furnishing of any materials that would give rise to any mechanics' or other
liens against the Premises, the Building or the Land. In the event any such
lien is attached to the Premises, the Building or the Land, then, in addition
to any other right or remedy of Landlord, Landlord may, but shall not be
obliged to, discharge the same. Any amount paid by Landlord for any of the
aforesaid purposes shall be reimbursed by Tenant to Landlord on demand as
Additional Rent.
The interest of Landlord shall not be subject to liens for
improvements made by Tenant in and to the Premises. Tenant shall notify every
contractor making such improvements of the provisions set forth in the
preceding sentence of this paragraph. The parties agree, should Landlord so
request, to execute, acknowledge and deliver without charge to Tenant, a Short
Form Lease in recordable form in accordance with Chapter 713, Florida Statutes
containing a confirmation that the interest of Landlord shall not be subject to
liens for improvements made by Tenant to the Premises.
21. Property Insurance.
Landlord shall maintain fire and extended coverage insurance on the
Building and the Premises, such policy(ies) to cover Landlord's interest in the
Building and Premises for not less than the full replacement value thereof.
Such insurance shall be maintained at the expense of Landlord (as a part of
Basic Costs), and payments for losses thereunder shall be made solely to
Landlord or the mortgagees of Landlord relative to the Land and the Building
(collectively, "Mortgagees"; each, a "Mortgagee"), as their respective
interests shall appear. Tenant shall maintain, at its expense, in an amount
equal to full replacement cost, fire and extended coverage insurance on all of
its personal property, including removable trade fixtures, located in the
Premises. Tenant shall, at Landlord's request from time to time, provide
Landlord with current certificates of insurance evidencing Tenant's compliance
with the terms and requirements of this Paragraph 21 and Paragraph 22 herein.
All policies required to be maintained by Tenant under this Paragraph 21 and
Paragraph 22 herein shall contain a provision whereby the insurer is not
allowed to cancel, fail to renew or change materially the coverage without
first giving thirty (30) days prior written notice to Landlord. Tenant shall
also obtain the agreement of Tenant's insurers to notify Landlord that a policy
is due to expire at least thirty (30) days prior to such expiration.
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22. Liability Insurance.
Tenant and Landlord shall, each at its own expense, maintain a policy
or policies of comprehensive general liability insurance (occurrence coverage)
with respect to the respective activities of each on the Land and in the
Building with the premiums thereon fully paid on or before the due date, issued
by and binding upon an insurance company authorized to conduct such business in
the State of Florida. Such comprehensive general liability insurance to be
maintained by Tenant and Landlord under this Paragraph 22 shall afford minimum
protection of not less than $1,000,000 combined single limit coverage of bodily
injury, property damage or combination thereof; and such comprehensive general
liability insurance to be maintained by Tenant shall name Landlord as an
additional insured. Such insurance coverage maintained by Tenant also shall
include, without limitation, personal injury and contractual liability coverage
for the performance by Tenant of the indemnity agreements set forth in this
Lease. Landlord shall not be required to maintain insurance against thefts
within the Premises or the Building or on the Land.
23. Indemnities.
Landlord shall not be liable to Tenant, or to Tenant's agents,
servants, employees, customers, or invitees for any injury to person or damage
to property caused by any act, omission, or neglect of Tenant, its agents,
servants, employees, invitees, licensees or any other person entering the Land,
the Building Exterior Common Areas, the Building or the Premises under the
invitation of Tenant or arising out of a default by Tenant in the performance
of its obligations hereunder or arising out of the use and occupancy of the
Premises by Tenant. Tenant hereby indemnifies and holds Landlord harmless from
all liability and claims for any such damage or injury. Landlord hereby
indemnifies and holds Tenant harmless from all liability and claims for damage
to property of Tenant incurred or suffered by Tenant or its employees to the
extent arising from the negligent acts or omissions of Landlord or any agent or
employee of Landlord in or about the Building Exterior Common Areas.
24. Waiver and Waiver of Subrogation Rights.
Anything in this Lease to the contrary notwithstanding (including,
without limitation, Paragraph 23 herein), Landlord and Tenant each hereby waive
any and all rights of recovery, claim, action, or cause of action, against the
other, its agents, officers, or employees, for any loss or damage that may
occur to the Premises or a part thereof, or any improvements thereto, or any
personal property of such party therein, by reason of fire, the elements, or
any other cause(s) which are insured against under the terms of the standard
fire and extended coverage insurance policies referred to in Paragraph 21
herein, regardless of cause or origin, including negligence of the other party
hereto, its agents, officers, or employees. All insurance policies carried with
respect to Paragraph 21 herein, if permitted under applicable law, shall
contain a provision whereby the insurer waives, prior to loss, all rights of
subrogation against Landlord and Tenant.
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25. Casualty Damage.
If the Premises or any part thereof shall be damaged by fire or other
casualty, Tenant shall give prompt written notice thereof to Landlord. In case
the Building shall be so damaged that substantial alteration or reconstruction
of the Building shall be required (whether or not the Premises shall have been
damaged by such casualty) or in the event any Mortgagee should require that the
insurance proceeds payable as a result of a casualty be applied to the payment
of the mortgage debt or in the event of any material uninsured loss to the
Building, Landlord may, at its option, terminate this Lease by notifying Tenant
in writing of such termination within ninety (90) days after the date of such
casualty. If, by reason of such casualty, the Premises are rendered
untenantable in some material portion, and the amount of time required to
repair the damage is reasonably determined by Landlord to be in excess of one
hundred eighty (180) days from the date upon which Landlord is required to
determine whether to terminate this Lease, then Tenant shall have the right to
terminate this Lease by giving Landlord written notice of termination within
thirty (30) days after the date Landlord delivers Tenant notice that the amount
of time required to repair the damage has been determined by Landlord to be in
excess of one hundred eighty (180) days. If Landlord (or Tenant, if applicable)
does not thus elect to terminate this Lease, Landlord shall commence and
proceed with reasonable diligence to restore the Building to substantially the
same condition as existed immediately prior to the occurrence of the casualty,
except that Landlord's obligation to restore shall not exceed the scope of the
work required to be done by Landlord in originally constructing the Building
Shell Improvements and installing the Tenant Improvements in the Premises, nor
shall Landlord be obligated to restore the Building Shell Improvements or the
Premises if the cost of the restoration work required under this Lease and all
other leases of space in the Building exceeds the insurance proceeds actually
received by Landlord as a result of the casualty. When the Tenant Improvements
have been restored by Landlord, Tenant shall restore Tenant's furniture and
equipment. Landlord shall not be liable for any inconvenience or annoyance to
Tenant or injury to the business of Tenant resulting in any way from such
damage or the repair thereof, except that, subject to the provisions of the
next sentence, Landlord shall allow Tenant a fair diminution of rent during the
time and to the extent the Premises are untenantable. If the Premises or any
other portion of the Building is damaged by fire or other casualty resulting
from the fault or negligence of Tenant or any of Tenant's agents, employees, or
invitees, the rent hereunder shall not be diminished during the repair of such
damage and Tenant shall be liable to Landlord for the cost of the repair and
restoration of the Building caused thereby to the extent such cost and expense
are not covered by insurance proceeds.
26. Condemnation.
If the whole or substantially the whole of the Building or the
Premises should be taken for any public or quasi-public use, by right of
eminent domain or otherwise or should be sold in lieu of condemnation, then
this Lease shall terminate as of the date when physical possession of the
Building or the Premises is taken by the condemning authority. If less than the
whole or substantially the whole of the Building or Premises is thus taken or
sold and the remaining portion
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of the Building can no longer be operated as a multi-tenant office building on
a financially sound basis, in Landlord's sole opinion, or if any Mortgagee
should require that the condemnation proceeds payable as a result of such
taking or sale be applied to the payment of the mortgage debt, Landlord
(whether or not the Premises are affected by the taking or sale) may terminate
this Lease by giving written notice thereof to Tenant, in which event this
Lease shall terminate as of the date when physical possession of such portion
of the Building or Premises is taken by the condemning authority. If this Lease
is not so terminated upon any such taking or sale and if a portion of the
Premises is affected thereby, the Base Rental payable hereunder shall be
diminished by an equitable amount, and Landlord shall, to the extent Landlord
deems feasible, restore the Building and the Premises to substantially their
former condition, except Landlord's obligation to restore shall not exceed the
scope of the work required to be done by Landlord in originally constructing
the Building Shell Improvements and installing the Tenant Improvements, nor
shall Landlord in any event be obligated to restore the Building Shell
Improvements or the Tenant Improvements if the cost of the restoration work
required under this Lease and all other leases of space in the Building exceeds
the amount received by Landlord for such taking. All amounts awarded upon a
taking of any part or all of the Building or the Premises shall belong to
Landlord, and Tenant shall not be entitled to and expressly waives all claims
to any such compensation. Tenant shall be entitled to make a separate claim
against the condemning authority for its personal property and moving expenses
provided that such claim does not diminish Landlord's award.
27. Damages from Certain Causes.
Landlord shall not be liable to Tenant for any loss or damage to any
property or person occasioned by theft, fire, act of God, public enemy,
injunction, riot, strike, insurrection, war, court order, requisition, or order
of governmental body or authority or by any other Force Majeure Matter. Nor
shall Landlord be liable for any damage or inconvenience which may arise
through repair or alteration of any part of the Building or premises. The
preceding sentence shall not limit Tenant's rights for the failure of Landlord
to complete the Tenant Improvements as provided for in Paragraph 3 of this
Lease.
28. Events of Default/Remedies.
(a) The following events shall be deemed to be events of default by
Tenant under this Lease: (i) Tenant fails to pay any installment of Base Rental
or Additional Rent when due and such failure continues for more than ten (10)
days after Tenant is given written notice of such failure (provided, however,
Tenant shall not be entitled to such notice and cure period more than twice in
any calendar year during the Lease Term); (ii) Tenant fails to comply with any
provision of this Lease (other than clauses (iii), (iv), (v), (vi) and (vii) in
this Paragraph 28(a)), all of which terms, provisions and covenants shall be
deemed material and such failure continues for more than thirty (30) days after
Tenant is given written notice of such failure (provided such 30-day notice and
cure period for non-monetary defaults shall be decreased or dispensed with, as
reasonably required, in cases of emergency or in circumstances where such
failure will result in a default by Landlord under other leases of space in the
Building); (iii) the leasehold hereunder demised is taken on
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execution or other process of law in any action against Tenant; (iv) Tenant
becomes insolvent or unable to pay its debts as they become due; (v) Tenant
takes any action to or notifies Landlord that Tenant intends to file a petition
under any section or chapter of the United States Bankruptcy Code, as amended
from time to time, or under any similar law or statute of the United States or
any State thereof; or a petition shall be filed against Tenant under any such
statute or Tenant or any creditor of Tenant's notifies Landlord that it knows
such a petition will be filed or Tenant notifies Landlord that it expects such
a petition to be filed; or (vi) a receiver or trustee is appointed for Tenant's
leasehold interest in the Premises or for all or a substantial part of the
assets of Tenant. Provided, however, and notwithstanding the foregoing
provisions in this Paragraph 28(a), Tenant shall not be entitled to any notice
and cure period in connection with Tenant's obligation to vacate the Premises
at the end of the Lease Term.
(b) Upon the occurrence under this Lease of any event or events of
default by Tenant, whether enumerated in Paragraph 28(a) herein or not,
Landlord shall have the option to pursue any one or more of the following
remedies: (i) terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord; (ii) terminate Tenant's right to occupy the
Premises and re-enter and take possession of the Premises (without terminating
this Lease) and relet or attempt to relet the Premises for the account of
Tenant and Landlord shall not be deemed to have thereby accepted a surrender of
the Premises, and Tenant shall remain liable for all Basic Rent, Additional
Rent or other sums due under this Lease and for all damages suffered by
Landlord because of Tenant's breach of any provision of this Lease; (iii) enter
upon the Premises and do whatever Tenant is obligated to do under the terms of
this Lease, and Tenant agrees to reimburse Landlord on demand for any expense
which Landlord may incur in effecting compliance with Tenant's obligations
under this Lease, and Tenant further agrees that Landlord shall not be liable
for any damages resulting to Tenant from such action; (iv) accelerate and
declare the entire remaining unpaid Basic Rent and Additional Rent for the
balance of the Lease Term to be immediately due and payable forthwith, and may,
at once, take legal action to recover and collect the same; and (v) exercise
all other remedies and seek all damages available to Landlord at law or in
equity, including, without limitation, injunctive relief of all varieties.
In the event Landlord elects to re-enter or take possession of the
Premises after Tenant's default, Tenant hereby waives notice of such re-entry
or repossession and of Landlord's intent to re-enter or take possession.
Landlord may, without prejudice to any other remedy which it may have for
possession or arrearages in rent, expel or remove Tenant and any other person
who may be occupying said Premises or any part thereof. In addition, the
provisions of Paragraph 31 herein shall apply with respect to the period from
and after the giving of notice of such termination to Tenant. All of Landlord's
remedies under this Lease shall be cumulative and not exclusive. Forbearance by
Landlord to enforce one or more of the remedies herein provided upon an event
of default shall not be deemed or construed to constitute a waiver of such
default or an election of remedies.
(c) Any installment of Base Rental and any Additional Rent not paid
within ten (10) days following the date when due and payable shall bear
interest from the date due until paid at
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the lesser of (i) eighteen percent (18%) per annum or (ii) the maximum lawful
contract rate per annum.
(d) This Paragraph 28 shall be enforceable to the maximum extent not
prohibited by applicable law, and the unenforceability of any portion thereof
shall not thereby render unenforceable any other portion. To the extent any
provision of applicable law requires some action by Landlord to evidence or
effect the termination of this Lease or to evidence the termination of Tenant's
right of occupancy, Tenant and Landlord hereby agree that notice, in writing
only and delivered in accordance with Paragraph 37 herein, shall be sufficient
to evidence and effect the termination therein provided for.
(e) Landlord shall be in default hereunder in the event Landlord has
not begun and pursued with reasonable diligence the cure of any failure of
Landlord to meet its obligations hereunder within thirty (30) days of receipt
by Landlord of written notice from Tenant of the alleged failure to perform.
Except as otherwise provided in Paragraph 3 herein, in no event shall Tenant
have the right to terminate or rescind this Lease or otherwise withhold or
abate Basic Rent or Additional Rent as a result of Landlord's default as to any
covenant or agreement contained in this Lease or as a result of the breach of
any promise or inducement hereof, whether in this Lease or elsewhere. Tenant
hereby waives such remedies for default hereunder and Tenant's remedies for
default by Landlord hereunder shall be limited to action for damages and/or
injunction. In addition, Tenant hereby covenants that, prior to the exercise of
any such remedies, it will give the Mortgagee(s) who then hold(s) a mortgage on
the Building the same notice and time period as Landlord to cure any default by
Landlord under this Lease.
29. Security Deposit.
As security for the performance of its obligations under this Lease,
Tenant, upon its execution of this Lease, has paid to Landlord a security
deposit (the "Security Deposit") in the amount stated in the Lease Summary. The
Security Deposit may be applied by Landlord to cure any default of Tenant under
this Lease, and upon notice by Landlord of such application, Tenant shall
replenish the Security Deposit in full by promptly paying to Landlord the
amount so applied. Landlord shall not pay any interest on the Security Deposit.
Within forty-five (45) days after the expiration date of the Lease Term,
Landlord shall return to Tenant the balance, if any, of the Security Deposit.
The Security Deposit shall not be deemed an advance payment of rent or a
measure of damages for any defense to any action which Landlord may at any time
commence against Tenant. If Landlord's interest in the Premises is sold or
otherwise transferred, Landlord shall have the right to transfer the Security
Deposit to the new owner, and upon the transfer of the Security Deposit,
Landlord shall thereupon be released from all liability for the Security
Deposit, and Tenant shall thereafter look solely to such new owner for the
Security Deposit. The terms hereof shall apply to every transfer of the
Security Deposit.
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30. Peaceful Enjoyment.
Tenant shall, and may peacefully have, hold, and enjoy the Premises
against Landlord and all persons claiming by and through or under Landlord for
the Lease Term, subject to the other terms hereof, provided Tenant pays the
rent and other sums herein recited to be paid by Tenant and performs all of
Tenant's covenants and agreements herein contained. This covenant and any and
all other covenants of Landlord shall be binding upon Landlord and its
successors only with respect to breaches occurring during its or their
respective periods of ownership of Landlord's interest hereunder.
31. Holding Over.
If Tenant remains in possession of the Premises or any part thereof
after the expiration or earlier termination of this Lease, whether with or
without Landlord's acquiescence, Tenant shall be deemed a tenant at will. In
the event of any such holding over by Tenant after the expiration or other
termination of this Lease or in the event Tenant continues to occupy the
Premises after the termination of Tenant's right of possession pursuant to
Paragraph 28(b) herein, Tenant shall, throughout the entire holdover period,
pay Base Rental equal to greater of one hundred twenty-five percent (125%) of
the Base Rental in effect immediately before the holdover period began or the
"Prevailing Market Rate" (to be determined in the same manner as provided for
in Paragraph 2 of the Special Stipulations set forth on Exhibit F attached
hereto), together with all applicable Additional Rent which would have been
applicable had the Lease Term continued through the period of such holding over
by Tenant. Tenant shall also remain liable for any and all damages, direct and
consequential, suffered by Landlord as a result of any holdover without
Landlord's unequivocal written acquiescence. No holding over by Tenant after
the expiration of the Lease Term shall be construed to extend the Lease Term.
32. Subordination to Mortgage.
Provided that Tenant receives an agreement of non-disturbance, Tenant
accepts this Lease subject and subordinate to any mortgage, deed of trust, or
other lien presently existing or hereafter arising upon the Premises, the
Building and/or the Land, and to any renewals, modifications, refinancings and
extensions thereof, but Tenant agrees that any such Mortgagee shall have the
right (without seeking or obtaining Tenant's consent) at any time to
subordinate such mortgage, deed of trust or other lien to this Lease. Tenant
agrees to cooperate and execute and deliver such further instruments
subordinating this Lease or attorning to the holder of any such liens as
Landlord may request within fifteen (15) days of the date of such request.
33. Estoppel Certificate.
Tenant agrees that it will, from time to time upon request by Landlord
and within fifteen (15) days of such request, cooperate and execute and deliver
to such persons as Landlord shall request an estoppel certificate in recordable
form certifying that this Lease is unmodified and in
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full force and effect (or if there have been modifications, that this Lease is
in full force and effect as so modified), stating the dates to which rent and
other charges payable under this Lease have been paid, stating that, to the
best knowledge of Tenant, Landlord is not in default hereunder (or if Tenant
alleges a default, stating the nature of such alleged default) and further
stating such other matters as Landlord shall reasonably require. In the event
that Tenant should fail to execute any such estoppel certificate promptly as
requested, Tenant hereby irrevocably constitutes Landlord as its
attorney-in-fact to execute such estoppel certificate in Tenant's name, place
and stead, it being agreed that such power is one coupled with an interest.
34. Attorneys' Fees.
In the event either party defaults in the performance of any of the
terms of this Lease and the other party employs attorney(s) in connection
therewith, the defaulting party agrees to pay the prevailing party's reasonable
attorneys' and paralegals' fees (calculated at such attorneys' reasonable and
customary hourly rates and without regard to the amount in controversy) and
costs of litigation, whether at the trial level, on appeal or in any bankruptcy
or administrative proceedings.
35. No Implied Waiver.
The failure of Landlord to insist at any time upon the strict
performance of any covenant or agreement herein or to exercise any option,
right, power or remedy contained in this Lease shall not be construed as a
waiver or a relinquishment thereof for the future. No payment by Tenant or
receipt by Landlord of a lesser amount than the monthly installment of rent due
under this Lease shall be deemed to be other than on account of the earliest
rent due hereunder, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice
to Landlord's right to recover the balance of such rent or to pursue any other
remedy in this Lease provided.
36. Personal Liability.
The liability of Landlord to Tenant for any default by Landlord under
the terms of this Lease shall be limited to the equity of Landlord in the
Building and the Land, and Tenant agrees to look solely to Landlord's equity in
the Building and the Land for recovery of any judgment from Landlord, it being
intended that neither Landlord nor the shareholders, parents, affiliates,
partners, members, or owners of Landlord shall be personally liable for any
judgment or deficiency.
37. Notices.
Any notice in this Lease provided for must, unless otherwise expressly
provided herein, be in writing, and may, unless otherwise in this Lease
expressly provided, be served by depositing
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<PAGE> 33
the same in the United States mail, postpaid and certified or registered and
addressed to the party to be notified, with return receipt requested, or by
delivering the same in person to an officer of such party, or by prepaid
telegram or overnight delivery service (e.g., Federal Express), addressed to
the party to be notified at the applicable address stated in the Lease Summary
or such other address, notice of which has been given to the other party
pursuant to this Paragraph 37. Notice deposited in the mail in the manner
hereinabove described shall be effective from and after the expiration of five
(5) calendar days after it is so deposited. Notice by prepaid telegram or
overnight delivery service shall be effective on the first business day after
said notice is sent. Notice by facsimile shall be effective on the day sent by
facsimile (provided the original is sent by one of the other permitted means).
38. Severability.
If any term or provision of this Lease, or the application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, or the application of such term or provision to
persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby, and each term and provision of
this Lease shall be valid and enforced to the fullest extent permitted by law,
notwithstanding the invalidity of any other term or provision hereof.
39. Recordation.
Tenant agrees not to record this Lease; provided, however, Landlord
shall execute and deliver a memorandum of this Lease, in recordable form, and
suitable to provide record notice of this Lease, if so requested by Tenant.
40. Governing Law and Venue.
This Lease and the rights and obligations of the parties hereto shall
be interpreted, construed, and enforced in accordance with the laws of the
State of Florida and venue for any actions initiated by Landlord or Tenant
shall be in Hillsborough County.
41. Force Majeure.
Whenever a period of time is herein prescribed for the taking of any
action by Landlord, Landlord shall not be liable or responsible for, and there
shall be excluded from the computation of such period of time, any delays due
to any condition, matter or circumstance beyond the reasonable control of
Landlord (collectively, "Force Majeure Matters"; each, a "Force Majeure
Matter"), including, without limitation, the following: strikes; defaults or
failures to perform by contractors or subcontractors; unavailability of
materials; lockouts; acts of God; governmental restrictions, war or enemy
action or invasion; civil commotion; insurrection; riot; mob violence;
malicious mischief or sabotage; fire or any other casualty; adverse weather
conditions or unusual inclement weather; a condemnation; failure of a
governmental instrumentality to act in a timely
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<PAGE> 34
fashion; any litigation or other legal proceeding which delays the approval of
plans or the issuance of any grading or building permit for construction,
including, without limitation, the issuance of an injunction enjoining such
approval and/or issuance, as the case may be; any law, order or regulation of
any governmental, quasi-governmental, judicial or military authority; or other
similar cause. Without limiting the generality of the foregoing, in the event a
Force Majeure Matter affects Landlord's construction and delivery obligation(s)
relative to the Premises under this Lease, at Landlord's option, the
Commencement Date shall be extended by the same number of days as the number of
days of delay caused by such Force Majeure Matter on the critical path of
completing such construction and delivery obligation(s).
42. Time of Performance.
Except as expressly otherwise herein provided, with respect to all
required acts of Tenant, time is of the essence of this Lease.
43. Transfers by Landlord.
Landlord shall have the right to transfer and assign, in whole or in
part, all its rights and obligations hereunder and in the Building and property
referred to herein, and in such event and upon such transfer Landlord shall be
released from any further obligations hereunder, and Tenant agrees to look
solely to such successor in interest of Landlord for the performance of such
obligations, except those obligations of Landlord with respect to which a
default exists as of the effective date of such transfer or assignment.
44. Commissions.
Landlord warrants and represents to Tenant that Landlord has not
engaged or contracted with any person, firm or entity to serve or act as a
broker, agent or finder, other than Broker (if any), for the purpose of leasing
the Premises or in regard to this Lease. Tenant warrants and represents to
Landlord that Tenant has not engaged, contracted with or dealt with any person,
firm or entity (other than Broker, if any) to serve or act as a broker, agent
or finder, for the purpose of leasing the Premises or in regard to this Lease.
Landlord agrees to be solely responsible for the payment of any commission to
Broker (if any) relating to this Lease pursuant to a separate agreement between
Landlord and Broker (if any). Tenant shall and does hereby indemnify and hold
harmless Landlord from and against any claim for any consulting fee, finder's
fee, commission, or like compensation, including reasonable attorneys' fees in
defense thereof, payable in connection with this Lease and asserted by any
party arising out of any act or agreement by Tenant, excluding the commission
payable by Landlord to Broker (if any) as described above.
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<PAGE> 35
45. Effect of Delivery of this Lease.
Landlord has delivered a copy of this Lease to Tenant for Tenant's
review only, and such delivery does not constitute an offer to Tenant or an
option in favor of Tenant. This Lease shall not be effective until an original
executed by both Landlord and Tenant is delivered to and accepted by Landlord.
46. Real Estate Investment Trust.
During the Lease Term, should a real estate investment trust become
Landlord hereunder, all provisions of this Lease shall remain in full force and
effect except as modified by this Paragraph 46. If Landlord in good faith
determines that its status as a real estate investment trust under the
provisions of the Internal Revenue Code of 1986, as heretofore or hereafter
amended, will be jeopardized because of any provision of this Lease, Landlord
may request reasonable amendments to this Lease and Tenant will not
unreasonably withhold, delay or defer its consent thereto, provided that such
amendments do not (a) increase the monetary obligations of Tenant pursuant to
this Lease or (b) in any other manner adversely affect Tenant's interest in the
Premises.
47. Hazardous Materials.
(a) Throughout the Lease Term, Tenant shall not knowingly cause,
permit or allow any chemical substances, asbestos or asbestos-containing
materials, formaldehyde, polychlorinated biphenyls, and toxic, carcinogenic,
radioactive, dangerous or hazardous material, substance, waste, contaminant, or
pollutant regulated now or hereafter by any governmental entity or agency
(collectively, "Hazardous Materials") to be placed, stored, dumped, dispensed,
released, discharged, used, sold, transported, or located on or within any
portion of the Premises, the Building or the Land by itself or its servants,
agents, employees, contractors, subcontractors, licensees, assignees or
subtenants; provided, however, minor quantities of Hazardous Materials may be
used or stored in the Premises for cleaning purposes only or in connection with
the use of office equipment and the normal operation of Tenant's office only,
so long as such quantities and the use thereof are permitted by or are exempt
from applicable governmental regulation. Tenant agrees to give Landlord prompt
written notice of any discovery, discharge, release or threatened discharge or
threatened release of any Hazardous Materials on or about the Premises, the
Building or the Land. Tenant agrees to promptly clean up any Hazardous
Materials which are placed in the Premises or on the Land by Tenant or its
servants, agents, employees, contractors, subcontractors, licensees, assignees
or subtenants and to remediate and remove any such contamination relating to
the Premises, the Building and/or the Land, as appropriate, at Tenant's cost
and expense, in compliance with all applicable laws, ordinances, rules and
regulations then in effect and to Landlord's satisfaction, at no cost or
expense to Landlord. Additionally, Tenant hereby agrees to indemnify and hold
harmless Landlord and Landlord's partners, officers, directors, members,
affiliates, employees and agents from and against all loss, cost, damage,
liability and expense (including attorneys' fees and expenses) arising from or
relating to any
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<PAGE> 36
Hazardous Materials (other than those permitted above) which are placed in the
Premises or the Building or on the Land by Tenant or its servants, agents,
employees, contractors, subcontractors, licensees, assignees or subtenants.
(b) The terms and provisions in this Paragraph 47 shall survive the
termination or earlier expiration of this Lease.
48. Landlord's Right of Relocation. [Intentionally deleted].
49. Evidence of Authority.
If requested by Landlord, Tenant shall furnish appropriate legal
documentation evidencing the valid existence and good standing of Tenant and
the authority of any parties signing this Lease to act for Tenant. By signing
this Lease on Tenant's behalf, the signatory for Tenant hereby represents the
truth of such facts to Landlord.
50. Survival of Obligations.
Notwithstanding any term or provision in this Lease to the contrary,
any liability or obligation of Landlord or Tenant arising during or accruing
with respect to the Lease Term shall survive the expiration or earlier
termination of this Lease, including, without limitation, obligations and
liabilities relating to (i) rent payments, (ii) the condition of the Premises
and the removal of Tenant's property, and (ii) indemnity and hold harmless
provisions in this Lease.
51. Confidentiality.
Tenant agrees, on behalf of Tenant and Tenant's employees, agents,
contractors, consultants, partners, affiliates, assignees and subtenants, not
to disclose the terms of this Lease or the results of any audit of Landlord's
books and records under this Lease to any third party except (i) legal counsel
to Tenant, (ii) any assignee of Tenant's interest in this Lease or any
subtenant of Tenant relative to the Premises (or any portion thereof), (iii) as
required by applicable law or by subpoena or other similar legal process, or
(iv) for financial reporting purposes.
52. Contractual Landlord's Lien.
Landlord shall have, and at all times, a valid security interest to
secure the payment of Basic Rent, Additional Rent, and other sums of money
becoming due hereunder from Tenant, and to secure payment of any damages or
loss which Landlord may suffer by reason of the breach by Tenant of any
covenant, agreement, or condition contained herein, upon all goods, wares,
equipment, fixtures, furniture, improvements, and other personal property of
Tenant presently or which may hereinafter situated in the Premises, and all
proceeds therefrom. Such property shall not be removed therefrom without the
consent of Landlord until all arrearages in rent as well as any and other sums
of money to Landlord hereunder shall first have been paid and discharged and
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<PAGE> 37
all the covenants, agreements, and conditions have been fully complied with and
performed by Tenant. In consideration of this Lease, upon occurrence and the
event of default by Tenant, Landlord may, in addition to any of the remedies
provided herein, enter upon the Premises and take possession of any and all
good, wares, equipment, fixtures, furniture, improvements, and other personal
property of Tenant situated on or in the Premises, without liability for
trespass or conversion, and sell the same at public or private sale, with our
without having such property at the sale, after giving Tenant reasonable notice
of the time and place of any public sale or of the time after which any private
sale is to be made, at which sale Landlord or its assigns may purchase. Unless
otherwise prohibited by law, and without intending to exclude any other manner
of giving Tenant reasonable notice, the requirement of reasonable notice shall
be met if such notice is given in the manner described in Paragraph 37 of this
Lease at least five (5) days before time of sale. Proceeds of any such
disposition, plus any and all expenses connected with the taking of possession,
holding and selling of the property (including reasonable attorneys' fees and
paralegals' fees, whether incurred in court, out of court, on appeal or in
bankruptcy administrative proceedings and other expenses), shall be applied as
a credit against the indebtedness of the secured by the security interest
granted in this Paragraph 52. Any surplus shall be paid to Tenant or as
otherwise provided by law, and Tenant shall pay any deficiencies forthwith.
Upon request by Landlord, Tenant agrees to execute and deliver to Landlord a
financing statement in the form sufficient to perfect the security interest of
Landlord in the aforementioned property and proceeds thereof under the
provisions of the Uniform Commercial Code in force in the State of Florida.
53. Rent a Separate Covenant. Tenant shall not for any reason withhold
or reduce Tenant's required payments of Basic Rent and other charges provided
in this Lease, it being expressly understood and agreed contractually by the
parties that the payment of Basic Rent, Additional Rent, and other charges
provided under this Lease is a contractual covenant by Tenant that is
independent of the other covenants of the parties under this Lease.
54. Radon.
As required by Florida Statutes, 404.056(6) 1995, Landlord notifies
Tenant as follows:
"RADON GAS: Radon is a naturally occurring radioactive gas, that when
it has accumulated in a building in sufficient quantities, it may present
health risk to persons who are exposed to it over time. Levels of Radon that
exceed federal and state guidelines have been found in buildings in Florida.
Additional information regarding Radon and Radon testing may be obtained from
your county public health unit."
55. Miscellaneous Provisions.
The entire agreement, intent and understanding between Landlord and
Tenant is contained in the provisions of this Lease and the exhibits attached
hereto and any stipulations, representations, promises or agreements, written
or oral, made prior to or contemporaneously with this Lease shall have no legal
or equitable effect or consequence unless reduced to writing herein
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<PAGE> 38
or in the exhibits attached hereto. This Lease may not be modified except by a
written instrument by the parties hereto. The terms "Landlord" and "Tenant" and
all pronouns relating thereto shall be deemed to mean and include corporations,
partnerships and individuals as may fit the context, and the masculine gender
shall be deemed to include the feminine and the neuter, and the singular
number, the plural.
56. Special Stipulations.
The special stipulations, if any, set forth on Exhibit F attached to
this Lease are incorporated herein by reference. If there is no Exhibit F
attached to this Lease, there are no such special stipulations. Such special
stipulations shall control if in conflict with any of the foregoing provisions
of this Lease.
57. WAIVER OF JURY TRIAL.
THE PARTIES HERETO SHALL, AND THEY HEREBY DO, WAIVE TRIAL BY JURY IN
ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO
AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF, OR IN ANY WAY
CONNECTED WITH, THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S
USE OR OCCUPANCY OF THE PREMISES AND/OR BUILDING AND/OR CLAIM OR INJURY OR
DAMAGE. IN THE EVENT LANDLORD COMMENCES ANY PROCEEDINGS TO ENFORCE THIS LEASE
OR THE LANDLORD/TENANT RELATIONSHIP BETWEEN THE PARTIES OR FOR NON-PAYMENT OF
BASIC RENT OF ANY NATURE WHATSOEVER, OR ADDITIONAL MONIES DUE LANDLORD FROM
TENANT UNDER THIS LEASE, TENANT WILL NOT INTERPOSE ANY COUNTERCLAIM OF WHATEVER
NATURE OR DESCRIPTION IN ANY SUCH PROCEEDINGS. IN THE EVENT TENANT MUST,
BECAUSE OF APPLICABLE COURT RULES, INTERPOSE ANY COUNTERCLAIM OR OTHER CLAIM
AGAINST SUCH PROCEEDING THE LANDLORD AND TENANT COVENANT AND AGREE THAT, IN
ADDITION TO ANY OTHER LAWFUL REMEDY OF LANDLORD UPON MOTION OF LANDLORD, SUCH
COUNTERCLAIM OR OTHER CLAIM ASSERTED BY TENANT SHALL BE SEVERED OUT OF THE
PROCEEDINGS INSTITUTED BY LANDLORD AND, IF NECESSARY, TRANSFERRED TO A COURT OF
DIFFERENT JURISDICTION, AND THE PROCEEDINGS INSTITUTED BY LANDLORD MAY PROCEED
TO FINAL JUDGMENT SEPARATELY AND APART FROM AND WITHOUT CONSOLIDATION WITH OR
REFERENCE TO THE STATUS OF EACH COUNTERCLAIM OR ANY CLAIM ASSERTED BY TENANT.
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease in
multiple original counterparts as of the day and year first above written.
Signed, sealed and delivered LANDLORD:
in the presence of:
CRESCENT RESOURCES, INC.,
a South Carolina corporation
/s/ Barbara M. Deakin By: /s/ Joseph W. Taggart
- --------------------------------- ----------------------------------
Print Name: Barbara M. Deakin Name: Joseph W. Taggart
---------------------- --------------------------------
Title: Vice President
-------------------------------
/s/ Jalena A. Peevy
- ---------------------------------
Print Name: Jalena A. Peevy [CORPORATE SEAL]
----------------------
TENANT:
BAY CITIES BANK, INC.
a Florida corporation
/s/ Lou Vassamas By: /s/ Timothy A. McGuire
- --------------------------------- ----------------------------------
Print Name: Lou Vassamas Name: Timothy A. McGuire
---------------------- --------------------------------
Title: President & CEO
-------------------------------
/s/ Sharon Aguayo
- ---------------------------------
Print Name: Sharon Aguayo [CORPORATE SEAL]
----------------------
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<PAGE> 40
EXHIBIT A
Description of Land
All that certain tract or parcel of land lying and being in the City
of Tampa, Hillsborough County, Florida, and being more particularly described
as follows:
A-1
<PAGE> 41
EXHIBIT B
Designation of Premises
[TO BE PROVIDED]
B-1
<PAGE> 42
EXHIBIT C
Construction of Improvements
1. Building Shell Improvements. Landlord, at Landlord's sole cost, shall
complete or has completed the following as part of the Building Shell
Improvements:
o 2' x 2' ceiling grid installed at 9' above the finished floor
o 2' x 2' regular acoustical ceiling tile (to be stacked on the floor in
the Premises)
o columns wrapped with drywall
o high efficiency 2' x 4', 3 lamp fixtures with 18-cell parabolic lenses
and lights at a ratio of one fixture per 75 square feet of Premises Net
Usable Area (to be stacked on the floor in the Premises)
o low pressure and medium pressure duct work
o interior and perimeter VAV boxes installed at the rate of approximately
one (1) per 1,548 usable square feet
o Building standard fire sprinkler system (in accordance with applicable
code requirements), with heads turned up
o demising walls: Landlord shall pay for the cost of the demising walls on
the Common Areas side of the demising wall and Tenant shall pay the cost
for the demising walls to the interior portion of the Common Areas
demising walls and the cost of the demising walls between the Premises
and other tenant space in the Building
o blinds for exterior windows
2. Construction Supervision. Landlord shall co-ordinate the design and
construction of the Tenant Improvements for Tenant as outlined below in
sections 3 through 8 of this Exhibit C. Landlord shall not receive a fee
for this construction administration/management service.
3. Architect. Urban Studies is hereby approved by Tenant and Landlord as the
architect for the Tenant Improvements and shall hereinafter be referred to
as "Tenant Architect". Landlord shall enter into a contract with the Tenant
Architect to prepare the Tenant Improvements Plans and Specifications.
Landlord shall have the right to use any mechanical, electrical and
plumbing architects/engineers required to complete the Tenant Improvement
Plans and Specifications.
4. Preliminary Plans. Tenant shall work with Tenant Architect to prepare a set
of design development plans (the "Preliminary Plans") acceptable to Tenant
for the interior build out of the Premises by March 1, 1999. Tenant shall
submit a signed set of the Preliminary Plans to Landlord for review and
approval which shall not be unreasonably withheld or denied. Landlord shall
have five (5) business days from receipt of the Preliminary Plans to review
and request any changes. In the event that Landlord fails to respond within
such five (5) business day period, Tenant shall notify Landlord, in
writing, that Landlord has failed to reply. In the event that Landlord
fails to respond to this second notice within five (5)
C-1
<PAGE> 43
business days from receipt of the second notice, Landlord shall be deemed
to have approved the Preliminary Plans. If changes are requested during the
review period, Tenant shall have fifteen (15) days to work with Landlord
and Tenant Architect to modify the Preliminary Plans so they are acceptable
to both Landlord and Tenant. If Tenant does not approve the Preliminary
Plans within this fifteen (15) day period, it shall be considered a Tenant
Delay Factor for each day thereafter that the Preliminary Plans have not
been approved.
5. Preliminary Budget. Once the Preliminary Plans have been approved by both
Tenant and Landlord, Landlord shall co-ordinate having a construction
budget prepared with a detailed line item breakdown of all costs and
contractor fees. Such budget shall hereinafter be referred to as
"Preliminary Budget". Landlord shall have the Preliminary Budget completed
for review by Tenant within fifteen (15) days after the Preliminary Plans
have been approved. Tenant shall have fifteen (15) days upon receipt of the
Preliminary Budget to review and approve the Preliminary Budget. If Tenant
does not respond within the fifteen (15) day review period, the Preliminary
Budget shall be considered approved by Tenant. If Tenant does not approve
the budget, in writing, Landlord and Tenant shall have thirty (30) days
from the date that Tenant informs Landlord of its disapproval to work with
Landlord and Tenant Architect to approve the Preliminary Plans accordingly.
If Tenant does not approve the Preliminary Budget within this thirty (30)
day period, it shall be considered a Tenant Delay Factor for each day
thereafter that the Preliminary Budget is not approved.
6. Tenant Improvement Plans and Specifications. Immediately after the
Preliminary Plans and Preliminary Budget have been approved by both Tenant
and Landlord, Landlord shall direct the Tenant Architect to prepare Tenant
Improvements Plans and Specifications. Landlord shall have forty-five (45)
days to complete the Tenant Improvement Plans and Specifications complete
with finishes and mechanical, electrical and plumbing engineered drawings.
7. Construction Bid. Landlord shall deliver the completed Tenant Improvement
Plans and Specifications to three (3) general contractors to obtain bids
from each contractor for the construction of the Tenant Improvements in
accordance with the Tenant Improvements Plans and Specifications and shall
obtain such bids on or before thirty (30) days from the approval of the
Tenant Improvements Plans and Specifications. After receipt of such bids,
Landlord and Tenant shall select the contractor that Landlord reasonably
believes to be the best for the job, taking into consideration prior
experience, price and financial stability. Landlord shall not be obligated
to accept the lowest bid. The selected contractor shall hereinafter be
referred to as the "Contractor" and the bid submitted by the Contractor
shall hereinafter be referred to as the "Final Construction Budget". If the
Final Construction Budget is not more than five percent (5%) over the
Preliminary Budget, the Final Construction Budget and the Tenant
Improvement Plans and Specifications shall be considered approved and
Landlord shall be released to submit the Tenant Improvement Plans and
Specifications to the Contractor for the construction of the Tenant
Improvements. If the Final Construction Budget is six percent (6%) or more
than the
C-2
<PAGE> 44
Preliminary Budget, then Tenant shall have ten (10) days from receipt of
such to review the Final Construction Budget to approve or disapprove. If
Tenant does not respond within the ten (10) day review period, the Final
Construction Budget and Tenant Improvement Plans and Specifications shall
be considered approved. If Tenant disapproves the Final Construction
Budget, then Tenant shall have thirty (30 ) days to work with Contractor,
Tenant Architect and Landlord to modify the Tenant Improvement Plans and
Specifications and Final Construction Budget so they are acceptable to
Tenant and Landlord. If Tenant does not approve the Final Construction
Budget and the Tenant Improvements Plans and Specifications within this
thirty (30) day period, it shall be considered a Tenant Delay Factor for
each day thereafter that they are not approved.
8. Change Order. After the approval of the Final Construction Budget and the
Tenant Improvement Plans and Specifications, any changes to the Tenant
Improvement Plans and Specifications shall be deemed a Change Order. In the
event Tenant desires a Change Order, Tenant shall deliver written notice to
Landlord. Upon receipt of such written notice, Landlord shall, within four
(4) business days, notify Tenant's Contact Person as to the cost of such
Change Order and whether such Change Order will cause a Tenant Delay
Factor. Upon notice to Tenant's Contact Person, Tenant shall have five (5)
days to advise Landlord of either going forward with the Change Order or
withdrawing the request for the Change Order. In the event that Tenant
fails to respond within such five (5) day period, Tenant shall be deemed to
have withdrawn such Change Order request.
C-3
<PAGE> 45
EXHIBIT D
Cleaning and Janitorial Services
LANDLORD SHALL FURNISH CLEANING AND JANITORIAL SERVICES TO THE PREMISES AND
COMMON AREAS AS DESCRIBED BELOW:
DAILY (Monday - Friday):
o Sweep, dry mop or vacuum, as appropriate, all floor areas; remove
material such as gum and tar which has adhered to the floor.
o Empty and damp wipe all ash trays, waste baskets and containers, remove
all trash from the leased premises.
o Dust all cleared horizontal surfaces with treated dust cloth, including
furniture, files, telephones, equipment that can be reached without a
ladder.
o Spot wash to remove smudges, marks and fingerprints from such areas that
can be reached without a ladder.
o Damp mop all non-resilient floors such as terrazzo and ceramic tile.
o Clean freight and passenger elevator cabs and landing doors.
o Clean mirrors, soap dispensers, shelves, wash basins, exposed plumbing,
dispenser and disposal container exteriors, damp wipe all ledges, toilet
stalls and toilet doors.
o Clean toilets and urinals with detergent disinfectants.
o Furnish and refill all soap, toilet, sanitary napkin and towel
dispensers.
o Spot clean carpet stains.
o Wash glass in Building directory, entrance doors and frames.
WEEKLY:
o Dust vertical blinds and louvers.
o Spot wash interior partition glass and door glass to remove smudge
marks.
o Sweep all stairs areas.
o Dust all baseboards.
D-1
<PAGE> 46
MONTHLY:
o Scrub and recondition resilient floor areas.
o Wash all stairwell landings and treads.
o Wash all interior glass both sides.
QUARTERLY:
o High dust all horizontal and vertical surfaces not reached by nightly
cleaning.
o Vacuum all ceiling and wall air supply and exhaust diffusers and grills.
o Wash and polish vertical terrazzo and marble surfaces.
o Spot clean carpeted areas.
SEMI-ANNUALLY:
o Damp wash diffusers, grills, and other such items.
ANNUALLY:
o Strip and refinish all resilient floors.
o Wash all building exterior glass both sides.
o Clean light fixtures, reflectors, globes, diffusers and trim.
o Clean all vertical surfaces not attended to during nightly, weekly,
quarterly or semi-annually cleaning.
Landlord will provide a day porter for use throughout the Building on
business days, Monday through Friday.
D-2
<PAGE> 47
EXHIBIT E
Rules and Regulations
1. Sidewalks, doorways, vestibules, halls, stairways, and similar
areas shall not be obstructed nor shall refuse, furniture, boxes or other items
be placed therein by any tenant or its officers, agents, servants, and
employees, or be used for any purpose other than ingress and egress to and from
premises in the Building, or for going from one part of the Building to another
part of the Building. Canvassing, soliciting and peddling in the Building are
prohibited.
2. Plumbing, fixtures and appliances shall be used only for the
purposes for which constructed, and no unsuitable material shall be placed
therein.
3. No signs, directories, posters, advertisements, or notices shall be
painted or affixed on or to any of the windows or doors, or in corridors or
other parts of the Building, except in such color, size, and style, and in such
places, as shall be first approved in writing by Landlord in its discretion.
However, the prohibition in the immediately preceding sentence shall not limit
or restrict any tenant's right to maintain within the premises occupied by such
tenant any signs, directories, posters, advertisements, or notices so long as
such items are not visible from the exterior of the premises occupied by such
tenant or from the Common Areas of the Building. Landlord shall have the right
to remove all unapproved signs without notice to any tenant, at the expense of
the responsible tenant.
4. No tenant shall do, or permit anything to be done, in or about the
Building, or bring or keep anything therein, that will in any way increase the
rate of fire or other insurance on the Building, or on property kept therein or
otherwise increase the possibility of fire or other casualty.
5. Landlord shall have the power to prescribe the weight and position
of heavy equipment or objects which may overstress any portion of the floor.
All damage done to the Building by the improper placing of such heavy items
will be repaired at the sole expense of the responsible tenant.
6. Each tenant shall notify the Building manager when safes or other
heavy equipment are to be taken in or out of the Building, and the moving shall
be done after written permission is obtained from Landlord on such conditions
as Landlord shall require.
7. All deliveries must be made via the service entrance and service
elevator, when provided, during normal working hours. Landlord's written
approval must be obtained for any delivery after normal working hours.
8. Each tenant shall cooperate with Landlord's employees in keeping
such tenant's premises neat and clean.
9. Each tenant shall not cause or permit any improper noises in the
Building, allow any unpleasant odors to emanate from the Premises, or otherwise
interfere, injure or annoy in any
E-1
<PAGE> 48
way other tenants or persons having business with them. However, Landlord
acknowledges that, if permitted by the applicable lease, a tenant may operate a
food services facility within the premises of such tenant for the sole use and
benefit of the occupants of such premises and that such food services facility
may emit odors normally associated with the operation of such on-site food
services facilities.
10. No animals shall be brought into or kept in or about the Building.
11. When conditions are such that a tenant must dispose of crates,
boxes, etc. on the sidewalk, it will be the responsibility of such tenant to
dispose of same prior to 7:30 a.m. or after 5:30 p.m.
12. No machinery of any kind, other than ordinary office machines such
as typewriters, information processing systems, copy machines, communications
equipment and calculators, shall be operated in any premises in the Building
without the prior written consent of Landlord, nor shall any tenant use or keep
in the Building any inflammable or explosive fluid or substance (including
Christmas trees and ornaments), or any illuminating materials. No space heaters
or fans shall be operated in the Building.
13. No motorcycles or similar vehicles will be allowed in the
Building.
14. No nails, hooks, or screws shall be driven into or inserted in any
part of the Building, except as approved by Building maintenance personnel.
Notwithstanding the foregoing, a tenant may decorate the interior of such
tenant's premises at such tenant's sole discretion provided such decorations do
not impact the structural integrity of the Building and cannot be seen from the
exterior of the Building or from any Common Areas of the Building.
15. Landlord has the right to evacuate the Building in the event of an
emergency or catastrophe.
16. No food and/or beverages shall be distributed from any tenant's
office without the prior written approval of the Building manager. But a tenant
may prepare coffee and similar beverages and warm typical luncheon items for
the consumption of such tenant's employees and invitees. Furthermore, Landlord
acknowledges that, if permitted by the applicable lease, a tenant may operate a
food services facility within the premises of such tenant for the sole use and
benefit of the occupants of such premises.
17. No additional locks shall be placed upon any doors without the
prior written consent of Landlord. All necessary keys or access cards or codes
shall be furnished by Landlord, and the same shall be surrendered upon
termination of the applicable lease, and each tenant shall then give Landlord
or Landlord's agent an explanation of the combination of all locks on the doors
or vaults. Replacement keys or access cards or codes (i.e., replacements for
keys or access cards or codes previously issued by Landlord) shall be obtained
only from Landlord, and Tenant shall pay to Landlord (as Additional Rent,
within thirty (30) days after Tenant receives an invoice therefor) the actual
costs incurred by Landlord in obtaining and issuing replacement keys or access
cards or codes for keys or access cards or codes previously issued.
E-2
<PAGE> 49
18. Tenants will not locate furnishings or cabinets adjacent to
mechanical or electrical access panels or over air conditioning outlets so as
to prevent operating personnel from servicing such units as routine or
emergency access may require. Cost of moving such furnishings for Landlord's
access will be for the responsible tenant's account. The lighting and air
conditioning equipment of the Building will remain the exclusive charge of the
Building designated personnel.
19. Each tenant shall comply with reasonable parking rules and
regulations as may be posted and distributed by Landlord from time to time.
20. No portion of the Building shall be used for the purpose of
lodging rooms.
21. Prior written approval, which shall be at Landlord's sole
discretion, must be obtained for installation of window shades, blinds, drapes,
or any other window treatment of any kind whatsoever. Landlord will control all
internal lighting that may be visible from the exterior of the Building and
shall have the right to change any unapproved lighting, without notice to the
responsible tenant, at the responsible tenant's expense.
22. No tenant shall make any changes or alterations to any portion of
the Building without Landlord's prior written approval, which may be given on
such conditions as Landlord may elect. All such work shall be done by Landlord
or by licensed contractors and/or workmen.
23. Tenant shall not employ any service or contractor for services or
work to be performed in the Building except as approved by Landlord.
24. No tenant, employee or invitee shall go upon the roof of the
Building, without prior approval and consent by Landlord.
25. Landlord reserves the right to waive any one of these rules or
regulations. With respect to any particular tenant and any such waiver shall
not constitute a waiver of any other rule or regulation or any subsequent
application thereof to the same or any other tenant. Notwithstanding the
foregoing, Landlord shall not selectively enforce the rules or act in a
discriminatory manner.
26. Tenant assumes all risks from theft or vandalism and agrees to
keep its Premises locked.
27. Landlord reserves the right to amend these rules and regulations
or make such additional reasonable rules and regulations it may from time to
time deem necessary for the appropriate operation and safety of the Building
and their occupants. Tenant agrees to abide by such additional or amended rules
and regulations.
E-3
<PAGE> 50
28. The following are established as reasonable and usual business for
access to the Building: 7:00 a.m. through 7:00 p.m. Monday through Friday,
except for January 1 (New Year's Day), the last Monday in May (Memorial Day),
July 4 (Independence Day), the first Monday in September (Labor Day), the last
Thursday in November (Thanksgiving) and December 25 (Christmas), or as may be
modified by Landlord pursuant to any law. Access to the building at any time
other than 7:00 a.m. through 7:00 p.m.; Monday through Friday (and on holidays
as described above) shall be through utilization of the building card reader
access system.
E-4
<PAGE> 51
EXHIBIT F
Special Stipulations
1. Right of First Refusal. Landlord and Tenant agree that, provided
Tenant in is possession of the Premises and is not in default of any of the
terms, covenants and conditions of this Lease, Tenant shall have a right of
first refusal to lease from Landlord any unleased space in the Building on the
first floor of the Building, but subject to other tenant's superior rights (the
"Additional Premises") on the same terms and conditions that Landlord shall
have received and deemed acceptable in a bonafide offer from a third party.
Tenant shall exercise its right of first refusal by written notice to
Landlord within seven (7) business days following receipt of written notice
from Landlord containing the terms of the third party's offer, acceptable to
the Landlord, for the Additional Premises. In the event that Tenant exercises
the right granted herein, Landlord and Tenant shall enter into an amendment to
this Lease to incorporate the Additional Premises and to make the necessary
adjustments to the Basic Rent and similar provisions to this Lease. In the
event Tenant declines to exercise its rights as provided for, or fails to
deliver or fails to deliver notice thereof within the time period stipulated
above, or fails to execute the requisite amendment of this Lease; this right of
first refusal shall lapse and be of no further force and effect. This right of
first refusal shall not be severed from this Lease or separately sold,
assigned, or transferred.
2. Renewal Option. Provided Tenant is in possession of the Premises
and is not in default of any term, covenant or condition of this Lease, Tenant
shall have the option to renew the term of this Lease for one (1) additional
period of five (5) years (the "Renewal Term") to commence immediately upon the
expiration of the initial Lease Term upon the same terms, covenants and
conditions as contained in this Lease except that (i) the Base Rental at the
"Prevailing Market Rate"; (ii) there shall be no abatement of rent; (iii)
Landlord shall not be obligated to construct, pay for, or grant an allowance
with respect to improvements to the premises unless otherwise specifically
provided for in this Lease, and (iv) there shall be no further option to renew
the Lease Term, except as specifically provided herein. The Prevailing Market
Rate shall mean the then current market renewal rental activity for Class A
office space in the Westshore area of Tampa, Florida.
In order to exercise the options granted herein, Tenant shall notify
Landlord in writing, not less than twelve (12) months prior to the expiration
of the initial Lease Term that it is exercising its option to renew the Lease
Term. On receipt of such notice, Landlord will in writing, not less than thirty
(30) days after receipt of a notice from Tenant, notify Tenant what the Base
Rental will be for such Renewal Term. Tenant shall within fifteen (15) days of
Landlord's notice of the Base Rental for such Renewal Term, notify Landlord if
Tenant accepts or disputes such Base Rental. If Tenant notifies Landlord within
the aforesaid fifteen (15) day period that Tenant disputes the Base Rental
quoted by Landlord, the parties shall during the following thirty (30) days
negotiate in good faith to determine the Base Rental for such Renewal Term. If
within said thirty (30) day period the parties are unable to agree on the Base
Rental, then within ten (10) days thereafter, each party shall select a duly
qualified licensed appraiser experienced in appraising
F-1
<PAGE> 52
commercial property in the vicinity of the Building who will submit appraisals
for the Premises within thirty (30) days of their appointment. If the
difference between the appraisals is five percent (5%) or less, the Base Rental
shall be determined by the average of the two appraisals. If the difference is
greater than five percent (5%) then the two appraisers shall select a third
qualified appraiser who will submit an appraisal within thirty (30) days
following the submission of the first appraisal. The Base Rental shall then be
the average of the two closest appraisals. The fees of such appraiser shall be
paid by the party appointing the appraiser. The fees of the third appraiser, if
any, shall be shared equally by the parties. In the event the Tenant exercises
the option, Landlord and Tenant shall execute a modification of this Lease
acknowledging said renewal and setting forth the Base Rental.
The option shall be void if at the time of such option Tenant is not
in possession of the Premises or is in default of this Lease or Tenant fails to
deliver the requisite notice thereof within the time period specified. The
option granted herein shall not be severed from the Lease, separately sold,
assigned or transferred.
3. Drive-Thru. Tenant shall be entitled to use a two (2) lane
drive-thru facility in the size, location and appearance as depicted on Exhibit
"H" attached to this Lease (the "Drive-Thru Facility"). The Drive-Thru Facility
shall be deemed part of the Premises for purposes of this Lease except that (i)
no Base Rental shall be applicable to the Drive-Thru Facility; (ii) all costs
of operation, maintenance and repair shall be at Tenant's sole cost and expense
(such that Landlord shall not bear any costs associated with the Drive-Thru
Facility) and; (iii) the Drive-Thru Facility shall not be used for calculation
of the square footage within the Premises Net Rentable Area, Premises Net
Useable Area, Building Net Rentable Area and Tenant Improvement Allowance. The
design and plans and specification for the Drive-Thru Facility shall be
included in the Tenant Improvement Plans and Specifications.
4. Exclusive Use. During the Lease Term, Landlord agrees not the enter
into a lease with another tenant in the Building with a specific permitted use
as a retail bank. This restriction shall immediately expire in the event that
Tenant no longer is using the Premises for a retail bank or is no longer in
occupancy of the Premises.
F-2
<PAGE> 53
EXHIBIT G
Commencement Date Stipulation
Pursuant to that certain Lease Agreement (the "Lease) between CRESCENT
RESOURCES, INC., a South Carolina corporation (the "Landlord"), and BAY CITIES
BANK, INC., a Florida corporation (the "Tenant"), dated as of _________________
199__, for certain premises in the Corporate Center at International Plaza
Office Building located at the Northwest corner of the intersection of North
Westshore Boulevard, Tampa, Florida, Landlord and Tenant hereby stipulate and
certify that:
1. The Commencement Date under the Lease is expiration date of the
Lease Term is _______________, 199___, and the expiration date of
the Lease Term is ___________________, ______.
2. Tenant's obligation to pay Rent under the Lease commenced on the
Commencement Date.
The terms and provisions of this Commencement Date Stipulation are
hereby incorporated into the Lease and modify any and all provisions to the
contrary contained therein.
Executed under seal as of the _____ day of __________________________,
199__.
TENANT:
BAY CITIES BANK, INC.
a Florida corporation
[CORPORATE SEAL]
ATTEST: By:
----------------------------------
Name:
- --------------------------------- --------------------------------
, Secretary Title: President
- ---------------------- ----------------------
LANDLORD:
CRESCENT RESOURCES, INC.,
a South Carolina corporation
[CORPORATE SEAL]
ATTEST: By:
----------------------------------
Name:
- --------------------------------- --------------------------------
, Secretary Title: President
- ---------------------- ----------------------
G-1
<PAGE> 54
EXHIBIT H
Drive-Thru Facility
LEASE.AGR
H-1
<PAGE> 1
Exhibit 23.2
ACCOUNTANTS' CONSENT
Board of Directors
Florida Business BancGroup, Inc.
Tampa, Florida:
We consent to the use of our report dated September 29, 1998 relating to the
balance sheet as of June 30, 1998 and the related consolidated statements of
operations and cash flows for the period from May 18, 1998 (date of
incorporation) to June 30, 1998 and to the reference to our firm under the
caption "experts" in the Form SB-2 and amendments thereto of Florida Business
BancGroup, Inc.
/s/ Hacker, Johnson, Cohen & Grieb PA
- --------------------------------------
HACKER, JOHNSON, COHEN & GRIEB PA
Tampa, Florida
January 27, 1999
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