UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13, or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 5, 1997 (May 1, 1997)
AREA BANCSHARES CORPORATION
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(Exact name of registrant as specified in its charter)
Kentucky 0-26032 61-0902343
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(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
230 Frederica Street, Owensboro, KY 42301
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(Address of principal executive office) (Zip code)
Registrant's telephone number, including area code: (502)926-3232
Not Applicable
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(Former name or former address, if changed since last report)
The Current Report consists of 6 pages.
The exhibit index is located on page 4.
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Item 5. Other Events
On May 1, 1997, Area Bancshares Corporation ("Area")
and Cardinal Bancshares, Inc. ("Cardinal") signed a
definitive agreement that provides for the combination
of Cardinal and Area.
Area will exchange 2.7391 shares of its common stock
for each share of Cardinal common stock. Based on
Area's closing price of $22.00 per share on April 30,
1997, and Cardinal's total outstanding shares and
options, the transaction would be valued at
approximately $109,000,000. The exchange value of
Cardinal stock would be $60.26 per share. The total
purchase price would be 1.88 times Cardinal's March 31,
1997, book value. The combination, which will be
accounted for as a pooling of interests, is expected to
be consummated during the fourth quarter of 1997,
pending Area and Cardinal shareholder approval,
regulatory approval, and other customary conditions of
closing.
A copy of the press release is attached hereto as
Exhibit 99-1, and is incorporated herein by reference.
Item 7. Financial Statements and Exhibits
C. Exhibits
Exhibit No. Description
99-1 Press release dated May 1, 1997
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
Area Bancshares Corporation
DATE: May 5, 1997 By: /s/John A. Ray
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John A. Ray
Senior Vice President &
Chief Financial Officer
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INDEX TO EXHIBITS
Exhibit Number Exhibit Description Page
99-1 Press release dated May 1,1997 5
Exhibit 99-1
PRESSRELEASE
Area Bancshares Corporation 230 Frederica Street Owensboro KY 42301
(502) 688-7750 Fax: (502) 686-1519
For Immediate Release
Date: May 1, 1997
Area Bancshares Corporation to Merge with Cardinal Bancshares, Inc.
Owensboro, Kentucky-
Area Bancshares Corporation (Nasdaq-NMS: AREA) and
Cardinal Bancshares, Inc. (Nasdaq-NMS: CARD) announced jointly
today that they have signed a definitive agreement that provides
for the combination of Cardinal and Area.
Under the terms of the agreement, Area will exchange
2.7391 shares of its common stock for each share of Cardinal
common stock. Based on Area's closing price of $22.00 per share
on April 30, 1997, and Cardinal's total outstanding shares and
options, the transaction would be valued at approximately $109
million and represent an exchange value of $60.26 for each share
of Cardinal common stock. The purchase price would be 1.88 times
Cardinal's March 31, 1997, book value. The combination, which
will be accounted for as a pooling of interests, is expected to
be consummated during the fourth quarter of 1997, pending Area
and Cardinal shareholder approval, regulatory approval, and other
customary conditions of closing. The transaction is expected to
be a tax-free reorganization for federal income tax purposes.
Cardinal is a Lexington, Kentucky, based bank holding
company with subsidiary financial institutions located in
Lexington, Louisville, Somerset, Springfield, and Harlan,
Kentucky. As of March 31, 1997, Cardinal had total assets of
$628,088,000, deposits of $545,291,000, and stockholder's equity
of $51,083,000. Cardinal reported net income of $1,615,000 for
the first three months of 1997, with an annualized return on
assets of 1.03% and a return on stockholder's equity of 12.65%.
Cardinal's common stock is traded in the NASDAQ national market
system under the symbol CARD.
<PAGE>
Area is an Owensboro, Kentucky, based bank holding
company with subsidiary financial institutions located in
Owensboro, Hopkinsville, Bowling Green, Russelville, Glasgow, and
Calhoun, Kentucky. Area also owns and operates a consumer loan
company. As of March 31, 1997, Area had total assets of
$1,146,376,000, deposits of $835,664,000, and stockholder's
equity of $124,752,000. Area reported net income of $3,605,000
for the first three months of 1997, with an annualized return on
assets of 1.33% and a return on stockholder's equity of 11.82%.
Area's common stock is also traded in the NASDAQ national market
system under the symbol AREA.
Thomas R. Brumley, President and Chief Executive
Officer of Area, expressed his delight with the agreement. "I am
thrilled at the prospect of working with the people at Cardinal,
who share our philosophy and vision of serving the customers and
communities of Kentucky. This transaction substantially expands
the merged companies' presence in Kentucky, allowing each of our
banks to be a larger, stronger player in the communities they
serve. We look forward to the creation of new relationships,
and will continue to build upon relationships with our
shareholders, employees and customers throughout the state."
John S. Penn, President and Chief Executive Officer of
Cardinal, commented "The merged new company will have a fortress-
like balance sheet and thus the ability to meet the coming
challenges of the financial services industry. The merger will
create a statewide franchise, which will be better able to serve
our customers and shareholders as we enter the next century."
For Additional Information contact:
At Area Bancshares Corporation
Timothy O. Shelburne, Senior Vice President and General Counsel 502/688-7750
At Cardinal Bancshares, Inc.
Jack H. Brown, Chief Financial Officer 606/255-8300
