Filed Pursuant to Rule 424(b)(3)
Registration Number: 333-64815
[LOGO]
(Holding Company for The Jacksonville Bank)
JACKSONVILLE BANCORP, INC.
Supplement No. 4
To Prospectus Dated February 9, 1999
This Supplement dated June 28, 1999, is intended to amend the Prospectus
dated February 9, 1999 through which Jacksonville Bancorp, Inc. ("Company") is
offering for sale a minimum of 800,000 shares of common stock and a maximum of
1,500,000 shares of common stock at a price of $10.00 per share. This Supplement
is also intended to wholly incorporate and completely supersede Supplement No. 1
dated March 1, 1999, Supplement No. 2 dated March 1, 1999 and Supplement No. 3
dated April 23, 1999. Supplement No. 2 extended the Offering Period until April
30, 1999 and Supplement No. 3 further extended the Offering Period until July
30, 1999. The Offering Period is currently to expire on July 30, 1999.
This Supplement is intended to be read in conjunction with and supersede
the Prospectus to the extent that any information in this Supplement conflicts
with information provided in the Prospectus.
On May 18, 1999, the Escrow Agent released $6,451,650 of subscription
proceeds to the Company to capitalize the Bank. The release of funds was in
accordance with the terms of the Escrow Agreement. The following information
discusses the activities of the Company and The Jacksonville Bank ("Bank") which
have taken place since February 9, 1999, through and including June 28, 1999,
except for information relating to the sale of shares, which information is
current through May 18, 1999.
RISK FACTORS
Failure of Bank to Commence Operations; Possible Loss of Subscription Funds
The Bank commenced operations and opened for business on May 28, 1999.
Prior to that date, the Company met the conditions for withdrawing subscription
funds from the Escrow Account and held a "first closing" on May 18, 1999.
<PAGE>
Intended Purchases by Organizers and Directors
The Organizers and Directors have purchased 288,000 shares of common stock.
At the time of the first closing, there were 871,056 shares of common stock
outstanding. The Organizers' and Directors' purchases equal 33.06% of the shares
outstanding as of May 18, 1999 (the first closing) and 19.20% of the maximum of
1,500,000 shares available in the Offering.
Failure to Receive Regulatory Approvals; Possible Loss of Subscription Funds
The Company's application to become a one-bank holding company was approved
on December 16, 1998. Having received its certificate of authorization from the
Florida Department of Banking and Finance and federal deposit insurance from the
FDIC, the Bank commenced banking operations on May 28, 1999.
Dependency on Key Management
In February 1999, Mr. Gilbert J. Pomar, III, was hired to be the President
of the Bank and to serve as its Chief Operating Officer and Ms. Cheryl L. Whalen
was hired as Senior Vice President and Chief Financial Officer for both the
Company and the Bank. Effective June 18, 1999, Mr. Victor M. George resigned his
positions as President and Chief Executive Officer of the Company and as Chief
Executive Officer of the Bank. Effective that same date, Mr. George resigned as
a Director for both the Company and the Bank.
Mr. R. C. Mills is now Chairman of the Company's Board, while Mr. Price W.
Schwenck is the Company's Chief Executive Officer. Mr. Schwenck also serves as
the Chairman of the Board for the Bank. Mr. Pomar has been appointed to serve as
the Bank's Chief Executive Officer. SEE "MANAGEMENT -- Directors and Executive
Officers of the Company and the Bank."
THE COMPANY
The Company's application to become a one-bank holding company was approved
on December 16, 1998. The Bank commenced operations on May 28, 1999, after
receiving its certificate of authorization from the Florida Department of
Banking and Finance and its federal deposit insurance from the FDIC.
TERMS OF THE OFFERING
Escrow of Offering Proceeds
On May 18, 1999, after having received notification from the Company that
it had received the required conditional regulatory approvals and having
received in excess of $8,000,000 in subscriptions, a "first closing" was held,
resulting in the Escrow Agent releasing $6,451,650 to the Company, which was
used to capitalize the Bank.
<PAGE>
Purchases by Organizers and Directors of the Company
The Organizers and Directors have purchased 288,000 shares of common stock
in the Offering. This purchase equals 33.06% of the outstanding shares as of May
18, 1999 (the first closing) and 19.20% of the maximum of 1,500,000 shares
available in the Offering.
USE OF PROCEEDS
The gross proceeds from the sale of shares offered by the Company will be a
minimum of $8,710,560 (as of May 18, 1999) and a maximum of $15,000,000.
The organizational and preopening expenses and the Offering expenses of the
Company and the Bank are as follows:
Minimum
Proceeds From
Sale of 871,056 Maximum
Shares Proceeds
------ --------
Offering Expenses(1) $ 527,112 $1,007,372
Organizational and Preopening Expenses(2) 658,108 658,108
------- -------
TOTAL $1,185,220 $1,665,480
========== ==========
(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 and preopening expenses include, among other expenditures,
application fees, salaries and related expenditures, legal and other
professional costs, temporary rent and utilities, costs for market
analysis, and preopening advertising. Interest earned on subscription funds
held in escrow is not reflected in these figures.
The gross proceeds from the Offering will be applied as follows:
Maximum
Minimum Proceeds
Proceeds Assuming
From Sale of Sale of
871,056 % of Net 1,500,000 % of Net
Shares Proceeds Shares Proceeds
------ -------- ------ --------
Repayment of Debt incurred to Fund
Preopening and Organizational
expenses of the Company and the
Bank(1) $984, 000 12.02% $ 984, 000 7.03%
Working Capital(2) 7,199,448 87.98 13,008,628 92.97
--------- ----- ---------- -----
Net Proceeds $ 8,183,448 100.00% $13,992,628 100.00%
=========== ====== =========== ======
Offering expenses of the Company
and the Bank 527,112 1,007,372
------- ---------
Gross Proceeds(3) $ 8,710,560 $15,000,000
=========== ===========
<PAGE>
- --------------------------
(1) Represents repayment of a revolving line of credit of $450,000 and
promissory notes payable to two Directors of $400,000. The actual
preopening and organizational expenses were $658,108. On December 17, 1998,
the Company obtained an unsecured line of credit from Columbus Bank and
Trust Company for $134,000 to cover any additional preopening expenses.
During the organizational period, the Company borrowed $1,700,009
($1,250,000 from Columbus Bank and Trust Company and $450,000 from
Independent Bankers' Bank of Florida) to fund the purchase of furniture,
fixtures and equipment, and for the purchase of the Bank's main office
building. These assets were transferred at cost to the Bank, with the
proceeds from the transfer used to repay existing debt. See "CERTAIN
TRANSACTIONS."
(2) The largest use of working capital was the purchase of all the Common Stock
of the Bank. The net investment in the Bank was $6,451,650. The primary use
of the remaining working capital will be income producing investments as
permitted by banking regulations, including additional investment in the
Bank as determined to be prudent by the Company's Board.
(3) Offering expenses were $527,112 as of May 18, 1999, and will be $1,007,372,
if the maximum amount of shares is sold. The Offering expenses include the
payment of an advisory fee to McAllen Capital Partners, Inc. in the amount
of 1.5% of gross proceeds. John W. Rose, a Director of the Company, is the
President of McAllen Capital Partners, Inc. See "CERTAIN TRANSACTIONS --
Financial Advisors."
The following table is a schedule of expenditures that have been made by the
Bank:
Investment by % of Net
Bank Proceeds
------------- --------
Organizational expenses of the Bank,
including application, legal and
consulting fees $ 68,691 .84%
Preopening expenses of the Bank,
including salaries, occupancy
and other expenses (1) 230,661 2.82
Purchase of furniture, fixtures
and equipment 519,142 6.34
Purchase and refurbishing of
main office 1,117,667 13.66
Working Capital(2) 4,975,489 60.80
--------- -----
Total Capital $6,911,650 84.46%
========== =====
- -------------------------
(1) Includes the annual salary of the former President and Chief Executive
Officer, Victor M. George, in the amount of $95,000 per year.
(2) The primary use of these funds will be to lend money to customers of the
Bank and for income producing investments. The income from loans and
investments will be used to pay general operating expenses of the Bank.
DESCRIPTION OF PROPERTY
On May 24, 1999, the Company sold its real property located at 10325 San Jose
Boulevard to the Bank. The purchase price was $1,105,611. This price represented
the original cost of the property to the Company, as well as the cost of
improvements that were made. This amount will not have a negative effect on
either the Company's or the Bank's financial condition, as the cost of the
building is a capitalizable expenditure for the Bank.
<PAGE>
The Bank also paid all of the closing costs relating to this transaction,
including state taxes, recording fees and the title insurance premium. These
costs, totaling $12,056, will be paid by the Bank.
ORGANIZERS AND PRINCIPAL SHAREHOLDERS
The current members of the Boards of Directors of the Company and the Bank
are: D. Michael Carter, George H. Groves, James M. Healey (Company only), John
C. Kowkabany (Company only), Rudolph A. Kraft (Company only), R.C. Mills
(Chairman of the Company's Board), Gilbert J. Pomar, III (Company only), John W.
Rose, John R. Schultz, Price W. Schwenck (Chairman of the Bank's Board), Charles
F. Spencer, Bennett A. Tavar and Gary L. Winfield.
The following chart shows stock ownership information with respect to the
Directors as of the date of the first closing:
% of Ownership
Based on % of Ownership
Shares Based on
Number of Outstanding Maximum
Name(1) Shares(2) on 5/18/99(3) Offering(3)
------- --------- ------------- -----------
D. Michael Carter 15,500 1.78% 1.03%
Victor M. George(4) 15,500 1.78 1.03
George H. Groves(5) 10,000 1.15 (6)
James M. Healey 27,500 3.16 1.83
John C. Kowkabany 25,000 2.87 1.67
Rudolph A. Kraft 20,000 2.30 1.33
R. C. Mills 40,000 4.59 2.67
Gilbert J. Pomar, III 5,000 (6) (6)
John W. Rose 30,000 3.44 2.00
John R. Schultz 25,000 2.87 1.67
Price W. Schwenck 20,000 2.30 1.33
Charles F. Spencer 15,000 1.72 1.00
Bennett A. Tavar 22,000 2.53 1.47
Gary L. Winfield, M.D 17,500 2.01 1.17
------ ---- ----
TOTAL 288,000 33.06% 19.20%
======= ===== =====
- --------------------------
(1) Each of the Organizers and Directors acquired their shares during the
Offering Period and in accordance with the terms set forth in the
Prospectus.
(2) Number of shares purchased in the Offering.
(3) Individual percentages based upon 871,056 shares outstanding as of May 18,
1999, and 1,500,000 at the maximum, respectively.
(4) Mr. George resigned his positions as Chief Executive Officer, President and
Director of the Company and Chief Executive Officer and Director of the
Bank, effective June 18, 1999.
(5) Mr. Groves has tendered his resignation as Director of the Bank and the
Company to be effective July 20, 1999.
(6) Less than 1%.
<PAGE>
MANAGEMENT
Directors and Executive Officers of the Company and the Bank
Since the date of the Prospectus, there have been some noted changes to the
management of the Bank. In February, the Board determined that the Bank needed
to strengthen its management team to include a Senior Commercial Lender, a Chief
Operations Officer and Chief Financial Officer. Mr. Victor M. George had been
designated as the Chief Executive Officer, Chief Financial Officer and President
for the Company and the Bank. On March 2, 1999, Ms. Cheryl L. Whalen was hired
as Executive Vice President and Chief Financial Officer for both the Company and
the Bank. On March 10, 1999, Mr. Gilbert J. Pomar, III, was hired by the Bank as
the President and Chief Operations Officer. Mr. Price W. Schwenck joined the
Company and the Bank as a Director in March 1999. Mr. Schwenck has over 26 years
of banking experience, the most recent of which were with First Union National
Bank of Jacksonville, where he served as the Regional President from 1994 until
1999. Based upon his extensive banking experience, Mr. Schwenck has subsequently
been appointed Chief Executive Officer of the Company and Chairman of the Board
for the Bank. Mr. R. C. Mills, who is an original Organizer and Director, is now
the Chairman of the Board for the Company.
Effective June 18, 1999, Mr. George resigned from his positions as
Executive Officer and Director with the Company and the Bank. In connection with
his resignation agreement, which runs through December 31, 1999, Mr. George is
to provide consulting services to the Company and the Bank as may be reasonably
required. SEE "MANAGEMENT -- Executive Compensation."
Gilbert J. Pomar, III, age 39, is the President and Chief Executive Officer
of the Bank. Mr. Pomar joined the Bank on March 10, 1999. Prior to joining the
Bank, he was employed with First Union National Bank of Jacksonville. Mr. Pomar
joined First Union in 1991. During his tenure with First Union, he was promoted
to Senior Vice President/Commercial Lending Manager in 1994 and head of
Commercial Banking in 1996. Mr. Pomar's banking experience includes four years
with Southeast Bank in West Palm Beach, Florida, as a Real Estate Workout
Officer and four years as a Commercial Real Estate Loan Officer at First Chicago
in Miami, Florida. Mr. Pomar is active in various community efforts, including
the United Way, Boy Scouts of America and is a Board Member of the Timuquana
Country Club. He is a graduate of the University of Florida, where he received
his Bachelor of Arts in Finance.
Cheryl L. Whalen, age 38, is the Executive Vice President and Chief
Financial Officer for the Company and the Bank. From March 1990 until March
1999, Ms. Whalen was with the O'Neil Companies and Merchants and Southern Bank
in Gainesville, Florida; initially as Senior Vice President and Cashier, and
later as Executive Vice President and Chief Financial Officer. Ms. Whalen has a
Certified Internal Auditor designation and is a graduate of Florida State
University, where she received her Bachelor of Science Degree in Accounting.
Price W. Schwenck, age 56, is the Chief Executive Officer of the Company
and the Chairman of the Board for the Bank. Mr. Schwenck served as Regional
President for First Union National Bank in Fort Lauderdale, Florida from 1988 to
1994 and First Union National Bank of Jacksonville, Florida from 1994 until he
retired in 1999. His community activities include the Jacksonville Chamber of
Commerce, Enterprise North Florida and North Florida Venture Capital Network.
Mr. Schwenck received his bachelors degree and MBA from the University of South
Florida in 1966 and 1970, respectively, and his MS from the University of Miami
in 1996.
<PAGE>
Scott M. Hall, age 35, is Senior Vice President of Commercial Banking. Mr.
Hall has 13 years of experience in the financial services industry. Prior to
joining the Bank, he was employed with First Union National Bank of Jacksonville
for 8 years as Vice President/Commercial Banking Relationship Manager. His
community activities include the Jacksonville Chamber of Commerce, Habitat for
Humanity and he is a member of the Clay County General Government Committee. Mr.
Hall is a graduate of the University of North Florida, where he received his
Bachelors of Business Administration Degree in Finance.
The Directors and Executive Officers for the Company and the Bank as of the
date of this Supplement are as follows:
<TABLE>
<CAPTION>
Name Position With Company Position With Bank
---- --------------------- ------------------
<S> <C> <C>
D. Michael Carter Director Director
George H. Groves(1) Director Director
James M. Healey Director ---
John C. Kowkabany Director ---
Rudolph A. Kraft Director ---
R. C. Mills Chairman of the Board Director
Gilbert J. Pomar, III Director President, CEO and COO
John W. Rose Director Director
John R. Schultz Director Director
Price W. Schwenck Director and CEO Chairman of the Board
Charles F. Spencer Director Director
Bennett A. Tavar Director Director
Cheryl L. Whalen Senior Vice President and CFO Executive Vice President and CFO
Gary L. Winfield, M.D Director Director
- --------------------
(1) Mr. Groves resigned as a Director of the Company and the Bank, to be
effective July 20, 1999.
</TABLE>
Executive Compensation
In connection with his resignation agreement and resignation as an
Executive Officer and Director of the Company and the Bank, Mr. George will be
paid one year's salary of $95,000 for which he agrees that, through December 31,
1999, he will provide consulting services to the Company and the Bank. The
payment is to be made in six equal monthly installments beginning on July 1,
1999.
<PAGE>
The Organizers, on behalf of the Bank, have entered into an employment
agreement with Mr. Gilbert J. Pomar, III, whereby Mr. Pomar will serve as the
Chief Executive Officer and President of the Bank. The employment agreement
provides for a $25,000 signing bonus and a base salary of $120,000. The term of
employment is for one year, with the agreement being renewed on a daily basis so
that, unless terminated, the agreement will continually have a one-year term.
The employment agreement permits Mr. Pomar to participate in all employee
benefits available to other employees, such as incentive compensation, stock
option plans, pension plans, insurance plans, and fringe benefits.
In the event Mr. Pomar voluntarily terminates his employment, the
employment agreement expires 30 days following the delivery of the notice of
termination to the Bank. However, if the termination is for good reason, as
defined in the employment agreement, he is entitled to severance pay equal to
his annual base salary, plus any incentive compensation or bonus.
The Bank may terminate Mr. Pomar's employment with or without cause. If
the Bank terminates his employment with cause, his employment is terminated
immediately upon delivery of notice, with no further compensation being due. If
Mr. Pomar is terminated without cause, he would be entitled to severance pay
equal to his annual base salary, plus any compensation or bonus. If the
employment of Mr. Pomar is terminated within 12 months of a change in control
either by the Bank without cause or by Mr. Pomar for good reason, Mr. Pomar will
be entitled to severance payment equal to 2.99 times his annual base salary,
plus incentive compensation.
Stock Option Plans
It is anticipated that up to 15% of the outstanding shares resulting from
this Offering will be set aside for stock options under the proposed stock
option plans, 7% to the employees of the Company, and 8% to the Directors of the
Company. Such options will not be granted at less than fair market value of the
Company's Common Stock on the date of the grant. Under Mr. Pomar's employment
agreement, he would be granted a stock option for a minimum of 25,000 shares and
a maximum of 50,000 shares, depending on the amount of shares sold in the
Offering. The stock options would be subject to adoption and approval of a
formal plan by the Company's shareholders.
SALES AGENT
On May 10, 1999, the Company, the Bank, and KBW entered into an Agreement
and Acknowledgment of Satisfaction which provided that KBW would accept $219,426
as payment for services it rendered as sales agent to the Company with respect
to the Offering, including compensation for any money paid or owed to
broker-dealers engaged by KBW to assist in the Offering.
