<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _________________ to ________________
Commission file number 333-69973
First Capital Bank Holding Corporation
-----------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 59-3532208
------------------------ -------------------------------
(State of Incorporation) (I.R.S. Employer Identification
No.)
1875A South 14th Street
Fernandina Beach, Florida 32034
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
904-321-0400
------------------
(Telephone Number)
Not Applicable
----------------------------
(Former name, former address
and former fiscal year,
if changed since last report)
Check whether the issurer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
YES XX NO
-- --
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
Ten (10) shares of common stock, $.01 par value per share, issued and
outstanding as of May 19, 1999. Registrant is currently offering its stock for
sale pursuant to a Registration Statement on Form SB-2, which the SEC declared
effective on April 12, 1999.
Transitional Small Business Disclosure Format (check one): YES NO XX
-- --
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The financial statements of First Capital Bank Holding Corporation (the
"Company") are set forth in the following pages.
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
Balance Sheet
March 31, 1999
(Unaudited)
Assets
------
Cash $ 1,501
Premises and equipment, net 439,759
Deferred offering expenses 83,495
Other assets 307
---------
$ 525,062
=========
Liabilities and Stockholders' Deficit
-------------------------------------
Accrued interest payable $ 13,014
Accounts payable and accrued expenses 4,486
Note payable - line of credit 774,678
---------
Total liabilities 792,178
=========
Stockholders' deficit:
Preferred stock, par value $.01, 1,000,000 shares authorized;
no shares issued or outstanding -
Common stock, par value $.01, 10,000,000 shares authorized;
10 shares issued and outstanding -
Additional paid-in capital 500
Deficit accumulated during the development stage (267,616)
---------
Total stockholders' deficit (267,116)
---------
$ 525,062
=========
See accompanying notes to financial statements.
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
Statement of Operations
For the Three Months Ended March 31, 1999 and
the Period from July 29, 1998 (inception) to March 31, 1999
(Unaudited)
Three Months Cumulative
Ended Through
March 31, 1999 March 31, 1999
-------------- --------------
Expenses:
Salaries and employee benefits $45,258 99,932
Consulting fees - 54,102
Application fees 250 21,394
Interest 16,305 29,226
Occupancy 5,993 14,145
Other operating 9,172 48,817
------- -------
Net loss $76,978 267,616
======= =======
Net loss per share $ .13 .44
======= =======
See accompanying notes to financial statements.
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
Statement of Cash Flows
For the Three Months Ended March 31, 1999 and
the Period from July 29, 1998 (inception) to March 31, 1999
(Unaudited)
<TABLE>
<CAPTION>
Three Months Cumulative
Ended Through
March 31, 1999 March 31, 1999
-------------- --------------
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (76,978) (267,616)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation expense 1,161 3,482
Decrease (increase) in other assets 486 (307)
Increase in accrued interest payable 6,433 13,014
(Decrease) increase in accounts payable and accrued expenses (43,105) 4,486
--------- --------
Net cash used in operating activities (112,003) (246,941)
--------- --------
Cash flows from investing activities:
Purchase of premises and equipment (140,059) (443,241)
Payments for deferred stock offering expenses (2,972) (83,495)
--------- --------
Net cash used in investing activities (143,031) (526,736)
--------- --------
Cash flows from financing activities:
Proceeds from note payable 254,000 774,678
Proceeds from issuance of common stock - 500
--------- --------
Net cash provided by financing activities 254,000 775,178
--------- --------
Net (decrease) increase in cash (1,034) 1,501
Cash at beginning of period 2,535 -
--------- --------
Cash at end of period $ 1,501 1,501
========= ========
Supplemental disclosure of cash flow information:
Interest paid $ 9,872 16,212
========= ========
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
Notes to Financial Statements
(1) Organization
------------
First Capital Bank Holding Corporation (the "Company") was incorporated for
the purpose of becoming a bank holding company. The Company intends to
acquire 100% of the outstanding common stock of First National Bank of
Nassau County (the "Bank") (in organization), which will operate in the
Fernandina Beach, Florida area. The organizers of the Bank filed a joint
application to charter the Bank with the Office of the Comptroller of
Currency and the Federal Deposit Insurance Corporation on September 30,
1998. Provided that the application is timely approved and necessary
capital is raised, it is expected that operations will commence in the
third quarter of 1999.
The Company plans to raise between $6,100,000 and $10,000,000 through an
offering of its common stock at $10 per share, of which $6,000,000 will be
used to capitalize the Bank. The organizers and directors expect to
subscribe for a minimum of approximately $3,000,000 of the Company's stock.
The Company is authorized to issue and sell up to 165,000 warrants in this
offering to the organizers. Each warrant entitles the holder to purchase
one share of common stock at an exercise price of $10.00 per share for a
period of five years beginning on the date the Bank opens for business. The
warrants will become exercisable in equal amounts beginning on the date the
Bank opens for business and on each of the four succeeding anniversaries of
that date. Each organizer will be granted one warrant for every two shares
that he or she purchases in the offering, assuming 900,000 shares are sold
in the offering. However, if less than 900,000 shares are sold in the
offering, the organizers will receive fewer warrants so that the number of
warrants to be granted to the organizers, plus the number of options to be
granted under the incentive stock option plan, will not exceed 23% of the
total number shares outstanding after the offering. The Company has also
reserved 100,000 shares for the issuance of options under an employee
incentive sotck option plan.
(2) Summary of Significant Accounting Policies
------------------------------------------
Premises and Equipment
Premises and equipment are stated at cost less accumulated depreciation.
Major additions and improvements are capitalized while maintenance and
repairs that do not improve or extend the useful lives of the assets are
expensed. When assets are retired or otherwise disposed of, the cost and
related accumulated depreciation are removed from the accounts, and any
gain or loss is reflected in earnings for the period.
Depreciation expense on furniture, fixtures and equipment is computed using
the straight-line method over 5 to 7 years.
Organization Costs
Costs incurred for the organization of the Company and the Bank (consisting
principally of legal, accounting, consulting and incorporation fees) are
expensed as incurred.
Deferred Offering Expenses
Costs incurred in connection with the stock offering, consisting of direct,
incremental costs of the offering, are deferred and will be offset against
the proceeds of the stock sale as a charge to additional paid in capital.
Pre-Opening expenses
Costs incurred for overhead and other operating expenses are included in
the current period's operating results.
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<PAGE>
FIRST CAPITAL BANK HOLDING CORPORATION
(A Development Stage Corporation)
Notes to Financial Statements, continued
(2) Summary of Significant Accounting Policies, continued
------------------------------------------
Proforma Net Loss Per Common Share
Proforma net loss per common share was calculated by dividing net loss by
the minimum number (610,000) of common shares, which would be outstanding
should the offering be successful, as prescribed in Staff Accounting
Bulletin Topic 1:B.
(3) Liquidity and Going Concern Considerations
------------------------------------------
The Company incurred a net loss of $267,616 for the period from July 29,
1998 (inception) to March 31, 1999. Management believes that the current
level of expenditures are well within the financial capabilities of the
organizers and adequate to meet existing obligations and fund current
operations, but obtaining final regulatory approvals and commencing banking
operations is dependent on successfully completing the stock offering.
To provide permanent funding for its operation, the Company is currently
offering a minimum of 610,000 and a maximum of 1,000,000 shares of its
common stock, $.01 par value, at $10 per share in an initial public
offering. Costs related to the organization and registration of the Bank's
common stock will be paid from the gross proceeds of the offering. Shares
issued which are outstanding at March 31, 1999 will be redeemed
concurrently with the consummation of the offering. Should subscriptions
for the minimum offering not be obtained, amounts paid by the subscribers
with their subscriptions will be returned and the offer withdrawn.
Organization, offering and pre-opening costs incurred prior to the opening
for business will be funded under a $1,500,000 line of credit. The terms of
the existing line of credit, which is guaranteed by the organizers, include
a maturity of July 29, 1999 and interest calculated at the prime interest
rate.
(4) Preferred Stock
---------------
Shares of preferred stock may be issued from time to time in one or more
series as established by resolution of the Board of Directors of the
Company. Each resolution shall include the number of shares issued,
preferences, special rights and limitations as determined by the Board.
(5) Commitments and Related Party Transactions
------------------------------------------
On August 19, 1998 the Company entered into an operating lease agreement
with two of the organizers for space which will serve as the temporary main
office of the Company and the Bank at a rate of $1,200 per month, subject
to increase after 6 months. The lease expires on June 30, 1999 and can be
canceled with a 30 day written notice.
Land on which the main office will be constructed was purchased from a
company owned by the spouse of one of the organizers.
The Company entered into an employment agreement with its President and
Chief Executive Officer, providing for an initial term of five years
commencing August 15, 1998. The agreement provides for a base salary, an
incentive bonus based on five percent of the Company's pre-tax earnings,
and annual stock options which vest equally over five years at $10 per
share equal to the lesser of 30,000 shares or five percent of the number of
shares sold in the initial public offering. Additionally, the Company is to
maintain a $1,000,000 key man life insurance policy, with $500,000 payable
to the Company and $500,000 payable to the President's family. The
agreement further provides for other prerequisites, and subjects the
President to certain noncompete restrictions.
-7-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company was organized on July 29, 1998 (the "Inception"). Since the
Inception, the Company's principal activities have been related to its
organization, the conducting of its initial public offering, the pursuit of
approvals from the Office of the Comptroller of the Currency (the "OCC") and
Federal Deposit Insurance Corporation (the "FDIC") of its application to charter
the Bank, and the pursuit of approvals from the Federal Reserve Board for the
Company to acquire control of the Bank.
At March 31, 1999, the Company had total assets of $525,062. These assets
consisted principally of deferred offering expenses of $83,495, cash of $1,501,
premises and equipment of $439,759. Premises and equipment consists primarily of
improvements to the Bank's current main office site and the acquisition of land
related to the Bank's permanent facility. Additiionally, the Company expects to
spend approximately $850,000 related construction costs associated with the
Bank's permanent facility.
The Company's liabilities at March 31, 1999 were $792,178 and consisted
primarily of advances under a line of credit from a bank of $774,678, and
accounts payable and accrued interest expenses of $13,014. The Company's line of
credit with The Bankers Bank is in the amount of $1,500,000, and the balance of
$725,322 is available to fund future organization expenses and expenditures
related to premises and equipment. The Company had a stockholders' deficit of
$267,116 at March 31, 1999.
The Company had a net loss of $76,978 for the quarter ended March 31, 1999,
and $267,616 cumulatively from Inception through March 31, 1999, or a pro forma
net loss of $.13 per share for the quarter ended March 31, 1999 and $.44 per
share cumulatively since Inception (assuming the sale of the minimum number of
shares in the offering were outstanding during the entire period). This loss
resulted from expenses incurred in connection with activities related to the
organization of the Company and the Bank. These activities included (without
limitation) the preparation and filing of an application with the OCC and the
FDIC to charter the Bank, the preparation of an application with the Federal
Reserve Board for approval of the Company to acquire the Bank, responding to
questions and providing additional information to the OCC, the FDIC and the
Federal Reserve Board in connection with the application process, preparation of
a Prospectus and filing a Registration Statement with the Securities and
Exchange Commission (the "SEC"), the selling of the Company's common stock,
meetings and discussions among various organizers regarding application and SEC
filing information, target markets and capitalization issues, hiring qualified
personnel to work for the Bank, conducting public relation activities on behalf
of the Bank, developing prospective business contacts for the Bank and the
Company, and taking other actions necessary for a successful bank opening.
Because the Company was in the organization stage, it had no operations from
which to generate revenues.
A minimum of $6,000,000 of the proceeds of the Offering will be used to
capitalize the Bank and the remainder will be used to pay organization expenses
of the Company and provide working capital, including additional capital for
investment in the Bank, if needed. The Company believes this amount will be
sufficient to fund the activities of the Bank in its initial stages of
operations, and that the Bank will generate sufficient income from operations to
fund its activities on an ongoing basis. For purposes of its charter application
with the OCC, the organizers estimated the Company's deficit when the Bank opens
to be approximately $500,000, although the actual deficit may be significantly
higher or lower. The Company believes that income from the operations of the
Bank will be sufficient to fund the activities of the Company on an ongoing
basis; however, there can be no assurance that either the Bank or the Company
will achieve any particular level of profitability. The Company has obtained an
$1,500,000 line of credit guaranteed by the organizers to provide the necessary
funding to cover costs and expenses the Company is expected to incur prior to
the completion of the Offering. In the event the proceeds of the Offering are
insufficient to provide the minimum initial funding needed for regulatory
approval, the proceeds from the Offering will be returned to the investors, the
Offering withdrawn, and the organizers will assume the obligations of the
Company.
-8-
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
There are no material pending legal proceedings to which the Company is
a party or of which any of their property is the subject.
Item 2. Changes in Securities
(a) Not applicable
(b) Not applicable
Item 3. Defaults Upon Senior Securities
Not applicable
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to security holders for a vote during
the three months ended March 31, 1999.
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Not applicable
(b) Not applicable
-9-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
FIRST CAPITAL BANK HOLDING CORPORATION
/s/ Michael G. Sanchez
-----------------------
Michael G. Sanchez
Chief Executive Officer
-10-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 1,501
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 0
<ALLOWANCE> 0
<TOTAL-ASSETS> 525,062
<DEPOSITS> 0
<SHORT-TERM> 774,678
<LIABILITIES-OTHER> 17,500
<LONG-TERM> 0
0
0
<COMMON> 0
<OTHER-SE> (257,116)
<TOTAL-LIABILITIES-AND-EQUITY> 525,062
<INTEREST-LOAN> 0
<INTEREST-INVEST> 0
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 0
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 16,325
<INTEREST-INCOME-NET> (16,305)
<LOAN-LOSSES> 0
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 60,673
<INCOME-PRETAX> (76,978)
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (76,978)
<EPS-BASIC> (.13)
<EPS-DILUTED> (.13)
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
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</TABLE>
