SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
Annual Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1999
Commission File Number: 0-22606
Britton & Koontz Capital Corporation
(Name of Small Business Issuer in its Charter)
Mississippi 64-0665423
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
500 Main Street
Natchez, Mississippi 39120
(Address of Principal Executive Offices) (Zip Code)
(601) 445-5576
(Issuer's Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Exchange Act:
None
Securities registered pursuant to Section 12(g) of the Exchange Act:
Common Stock, $2.50 Par Value
(Title of Class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past
90 days. Yes [X] No
Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B contained in this form, and no disclosure will be contained,
to the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]
The issuer's revenues for the 1999 fiscal year were $15,826,604.
The aggregate market value of the issuer's voting stock held by non-affiliates
computed by reference to the price at which the stock was sold as of March 21,
1999 is $19,416,690 for 1,093,898 shares at an estimated $17.75 per share.
State the number of shares outstanding of each of the issuer's classes of
common equity, as of March 31, 2000.
Common Stock, $2.50 Par Value: 1,759,064 shares
Transitional Small Business Disclosure Format (check one): Yes No [X]
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
1. Portions of the Registrant's annual report to shareholders for
the fiscal year ended December 31, 1999, (the "Annual Report")
are incorporated by reference into Part II of this annual
report on Form 10-KSB.
2. Portions of the Registrant's definitive proxy statement, filed
on March 27, 2000 with the Securities and Exchange Commission,
(the "Proxy Statement") are incorporated by reference into
Part III of this annual report on Form 10-KSB.
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CROSS REFERENCE INDEX
TO
FORM 10-KSB
Certain information required by Form 10-KSB is incorporated by
reference from the annual report to shareholders as indicated below. Only that
information expressly incorporated by reference is deemed filed with the
Commission.
PART I
ITEM 1. DESCRIPTION OF BUSINESS.........................................*
ITEM 2. DESCRIPTION OF PROPERTY........................................ *
ITEM 3. LEGAL PROCEEDINGS.............................................. *
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.............*
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.............................................*
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION..............................................**
ITEM 7. FINANCIAL STATEMENTS...........................................**
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE ............................*
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(a) OF THE EXCHANGE ACT.............................***
ITEM 10. EXECUTIVE COMPENSATION........................................***
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT................................................***
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS................***
ITEM 13. EXHIBITS, LIST AND REPORTS ON FORM 8-K..........................*
* This information is included in this annual report on Form 10-KSB and is not
incorporated by reference from the Annual Report or the Proxy Statement.
** This information is incorporated by reference from portions of the Annual
Report pursuant to Instruction E(2) of Form 10-KSB. Those portions of the Annual
Report are included as Exhibit 13 to this annual report on Form 10-KSB.
*** The material required by Items 9 through 12 is incorporated by reference
from the Proxy Statement pursuant to Instruction E(3) of Form 10-KSB.
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PART I
Item 1. Description of Business.
General
The Company
Britton & Koontz Capital Corporation (the "Company") was organized as a
Mississippi business corporation in July of 1982 and became a one-bank holding
company registered under the Bank Holding Company Act of 1956, as amended (the
"BHCA"), when it acquired all of the issued and outstanding shares of Britton &
Koontz First National Bank, a national banking association headquartered in
Natchez, Mississippi (the "Bank"), later that same year. The Bank is the only
wholly-owned subsidiary of the Company and its stock is the Company's most
significant asset. In July, 1993, the Company acquired Natchez First Federal
Savings Bank ("Natchez First Federal") and merged it into the Bank. In December
1998, the Company invested $1.0 million for a 35% interest in Sumx Inc., a
company formed to develop and market internet- based electronic banking to
financial institutions. See "Sumx Inc." In January 1999, the bank purchased from
Union Planters Bank, N.A. two local branches with total deposits of $12 million
and $1.8 million in loans. In July 1999, the company completed the acquisition
of another branch office with deposits of $6 million and $1.4 million in loans.
The Company's major source of income in 1999 was dividends from the
Bank in the amount of $1,400,000. The Company expects that dividends from the
Bank will continue to be the Company's major source of income in 2000. As of
December 31, 1999, the Company had total consolidated assets of approximately
$209 million, and total consolidated shareholders' equity of approximately $20
million.
The Bank
The Bank conducts a full service banking business from its main office
and three branch offices in Natchez, Mississippi and one branch in Vicksburg,
Mississippi. It also opened a loan production office in Baton Rouge, Louisiana
for the purpose of originating 1-4 family residential first mortgage loans. The
Bank provides commercial and consumer banking and trust services to customers in
Adams and Warren Counties and the adjoining counties and parishes of Mississippi
and Louisiana, respectively. The geographical area serviced by the Bank is
economically diverse and includes public and private sector industries,
including government service, manufacturing, tourism, agriculture and oil and
gas exploration.
The products and services offered by the Bank include personal and
commercial checking accounts, money market deposit accounts, savings accounts,
and automated clearinghouse services. The Bank also offers money transfer
services, safe deposit box facilities and access to a network of automated
teller machines. In recent years and primarily as a result of its merger
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with Natchez First Federal in July, 1993, the Bank has become a full-service
residential and commercial mortgage lender. The Bank also engages in other
commercial and consumer lending activities, including, among other things, the
issuance of VISA and MasterCard credit cards. The Bank's trust department offers
a range of trust services, acting as trustee, executor, administrator,
custodian, guardian and agent with responsibility for total assets as of
December 31, 1999, of approximately $27 million.
In 1995, the bank became an Internet Service Provider for the Natchez
area. The service of Internet dial up access has been extended to the Vicksburg,
Ms. market. In 1996, the bank began offering Internet-based online banking. The
software employed was developed by Interbank Systems ("Interbank"), now Sumx Inc
("Sumx").
As of December 31, 1999, the Bank had total assets of approximately
$208 million and total deposits of approximately $167 million.
As of December 31, 1999, the Company and the Bank had approximately 91
full-time and 10 part-time employees for a total of 101 employees. The employees
are not represented by a collective bargaining unit. The Company believes that
its relationship with its employees is good.
Sumx Inc.
On December 3, 1998, the Company acquired 1,000,000 shares of Series A
Preferred Stock in Sumx Inc. ("Sumx"), a Mississippi corporation, for
$1,000,000. Sumx is owned 35% by the Company, 19.5% by Mr. Bazile R. Lanneau,
Jr., President and CEO of Sumx and Executive Vice President of the Bank and Vice
President of the Company, and 45.5% by Summit Research, Inc., a Texas
corporation. The funds provided to Sumx have been used for marketing and
continued development of the SumxNet Internet banking system and for service
bureau operations. Sumx maintains offices in Madison, Mississippi and Highland
Village, Texas.
Mr. Lanneau has devoted and it is anticipated that he will continue to
devote in the future substantial portions of his time to the business of Sumx.
Pursuant to a Management Services Agreement, Sumx pays the Company $90,000 per
year for the services of Mr. Lanneau. Mr. Lanneau receives no compensation from
Sumx and is compensated by the Company and the Bank. Mr. Ogden, President and
CEO of the Company and the Bank, serves without compensation as a director,
and Secretary/Treasurer of Sumx.
Supervision and Regulation
The banking industry is extensively regulated under federal and state
law. As a bank holding company, the Company is subject to regulation under the
BHCA and to supervision by the Board of Governors of the Federal Reserve System
(the "FRB"). Pursuant to the BHCA, the Company may not directly or indirectly
acquire the ownership or control of more than 5% of any class of voting shares
or substantially all of the assets of any other company, including a bank,
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without the prior approval of the FRB. The BHCA further limits the activities of
both the Company and the Bank to the business of banking and activities closely
related or incidental to banking.
As a national bank, the Bank is subject to supervision and regular
examination by the Office of the Comptroller of the Currency (the
"Comptroller"). Such examinations, however, are for the protection of the Bank
Insurance Fund ("BIF") and, indirectly to a degree, for depositors, and not for
the protection of investors and shareholders. Pursuant to the terms of the
Federal Deposit Insurance Act (the "FDIA"), the deposits of the Bank are insured
through the BIF and the Savings Association Insurance Fund ("SAIF") of the
Federal Deposit Insurance Corporation (the "FDIC"). Accordingly, the Bank is
subject to regulation by the FDIC and is also subject to the Federal Reserve's
requirements to maintain reserves against deposits, restrictions on the types
and amounts of loans that may be granted and the interest that may be charged
thereon, and limitations on the types of investments that may be made and the
types of services that may be offered.
In 1991, Congress enacted the Federal Deposit Insurance Corporation
Improvement Act ("FDICIA"), which, among other things, substantially revised the
depository institution regulatory and funding provisions of the FDIA. FDICIA
also expanded the regulatory and enforcement powers of bank regulatory agencies.
Most significantly, FDICIA mandates annual examinations of banks by their
primary regulators and requires the federal banking agencies to take prompt
"corrective action" whenever financial institutions do not meet minimum capital
requirements. FDICIA establishes five capital tiers: "well capitalized,"
"adequately capitalized," "undercapitalized," "significantly undercapitalized"
and "critically undercapitalized." A depository institution's capitalization
status will depend on how well its capital levels compare to various relevant
capital measures and certain other factors, as established by regulation. As of
December 31, 1999, the Bank maintained a capital level which qualified it as
being "well capitalized" under such regulations.
FDICIA also prohibits a depository institution from making any capital
distribution (including payment of a dividend) or paying any management fee to
its holding company if the depository institution would thereafter be
"undercapitalized." For additional information regarding restrictions on the
Bank's payment of dividends, see Item 5 - "Market for Common Equity and Related
Stockholder Matters -- Dividends," below.
The banking industry is affected by the policies of the FRB. An
important function of the FRB is to regulate the national supply of bank credit
to moderate recessions and to curb inflation. Among the instruments of monetary
policy used by the FRB to implement its objectives are: open-market operations
in U.S. Government securities, changes in the discount rate on bank borrowings
and changes in reserve requirements on bank deposits.
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Interstate Banking and Branching Legislation
Federal Law
In 1994, Congress passed the Riegle-Neal Interstate Banking and
Branching Efficiency Act ("Riegle-Neal"), which affected the interstate banking
and branching abilities of bank holding companies and banks.
Beginning June 1, 1997, Riegle-Neal authorizes a national bank
domiciled in one state to establish branches in any other state as long as
neither state has opted out of interstate branching between the date of
enactment of Riegle-Neal and May 31, 1997. Riegle-Neal, however, does allow
states to preserve certain restrictions on the entry of out-of-state banks, such
as the fashion in which entry can be made, an age requirement for a bank being
merged or acquired, and a deposit cap. Under Riegle-Neal, once a bank has
established a branch in another state, it may exercise the same rights in that
state as national and state banks enjoy in that state, including the ability to
branch intra-state. Riegle-Neal provides that states may opt in early to
interstate branching prior to June 1, 1997.
Riegle-Neal also permits states to allow banks to enter the state by
establishing a de novo branch in that state. In order to allow de novo entry
into a state, that state must expressly provide for de novo branching. Once a
bank has established a branch in a host state through de novo branching, it may
exercise the same rights in that state as national and state banks enjoy,
including the ability to branch intra-state. If a state opts out of interstate
branching, no bank domiciled in that state may establish branches in other
states, and no bank domiciled in another state may establish branches in that
state.
Mississippi Law
On March 29, 1996, the Governor of Mississippi signed into law a bill
in which Mississippi elected to opt in to interstate branching, effective May 1,
1997. As enacted, the bill would (1) allow all Mississippi banks to establish
branches in any other state pursuant to the entry rules in the potential host
state, and (2) allow out-of-state banks to establish branches in Mississippi
pursuant to Mississippi's entry rules. The bill as enacted, however, does not
authorize de novo branching into Mississippi. An out-of-state bank can establish
branches in Mississippi only by (1) merging with a Mississippi domiciled bank,
(2) buying all of the assets of a Mississippi domiciled bank, or (3) buying all
of the assets in Mississippi of an out-of-state bank which has branches in
Mississippi. All interstate branching transactions require appropriate
regulatory approval.
Consequence of Increased Interstate Activity
Because of the increasing liberalization of the laws and regulations
affecting the conduct of interstate banking activities, it is anticipated that
competition in the Bank's geographical market
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area will increase. If large, regional bank holding companies acquire branches
in the Bank's market area, they may offer a wider range of services than are
currently offered by the Bank. In addition, some of these competitors may be
more highly capitalized than the Bank and the Company.
Further Changes in Regulatory Requirements
The United States Congress and the Mississippi legislature have
periodically considered and adopted legislation that has resulted in
deregulation of, among other matters, banks and other financial institutions, or
adversely affected the profitability of the banking industry. See "Competition."
Legislation could further modify or eliminate geographic restrictions on banks
and bank holding companies and current prohibitions with other financial
institutions, including mutual funds, securities brokerage firms, insurance
companies, banks from other states and investment banking firms. The effect of
any such legislation on the business of the Company or the Bank cannot be
accurately predicted. The Company also cannot predict what legislation might be
enacted or what other implementing regulations might be adopted, and if enacted
or adopted, the effect thereof.
Restriction on Dividends
The Company is a legal entity separate and distinct from the Bank and
substantially all of the Company's revenues result from amounts paid by the
Bank, as dividends, to the Company. The payment of dividends by the Bank is, of
course, dependent upon its earnings and financial condition. The Bank, however,
as a national bank, is also subject to legal limitations on the amount of its
earnings that it may pay as dividends. For additional information regarding the
restrictions on the Bank's payment of dividends, see Item 5 - "Market for Common
Equity and Related Stockholder Matters--Dividends," below.
Competition
There is significant competition among banks and bank holding companies
in Mississippi. The Bank competes with both national and state banks for
deposits, loans and trust accounts and with savings and loan associations and
credit unions for loans and deposits. The Bank also competes with large national
banks from the principal cities in Louisiana and Mississippi for certain
commercial loans.
The deregulation of depository institutions as well as the increased
ability of non-banking financial institutions, such as finance companies,
investment companies, insurance companies and several governmental agencies, to
provide services previously reserved to commercial banks has further intensified
competition. Accordingly, the Bank now competes with these non-banking financial
institutions, all of which are engaged in marketing various types of loans,
commercial paper, short-term obligations, investments and other services.
Because non-banking financial institutions are not subject to the same
regulatory restrictions as banks and bank holding
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companies, in many instances they may operate with greater flexibility. The
continued deregulation of the financial services industry may have a detrimental
effect on the Bank's long- term growth and profitability.
The Company anticipates that the intensity of competition among
financial institutions will be increased when the provisions of the
Gramm-Leach-Bliley Act (the "GLBA") become fully effective and the regulations
implementing the GLBA are issued by the Board of Governors of the FRB. The GLBA
permits banks, securities firms and insurance companies to affiliate under an
entity to be known as a "financial holding company," which could then serve its
customers' varied financial needs through a single corporate structure.
Environmental
The Company is subject to various federal, state and local statutes and
ordinances regulating the discharge of materials into the environment. The
Company does not believe that it will be required to expend any material amounts
to comply with these laws and regulations.
Item 2. Description of Property.
The Company has its principal offices in its headquarters building at
500 Main Street, Natchez, Adams County, Mississippi 39120, which is owned and
occupied by the Bank. The Bank also owns the properties on which its four branch
offices are located, as well as one property purchased for future expansion. The
Company also owns certain properties acquired primarily through foreclosure
proceedings. In the judgment of management, the facilities of the Company and
the Bank are generally suitable and adequate for the needs of the Company and
the Bank.
Item 3. Legal Proceedings.
There are no pending legal proceedings of a material nature to which
the Company or the Bank is a party.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
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PART II
Item 5. Market for Common Equity and Related Stockholder Matters.
(a) Market Information
On October 17, 1996, the Company listed its common stock on the NASDAQ
Small Cap Market. Prior to that date, there was no established public trading
market for the common stock. The table below sets forth the NASDAQ Small Cap
Market high and low bid ranges for the common stock.
Dividends
Per Share High Low
Period 1999
4th Quarter $ .30 $20.00 $17.88
3rd Quarter $21.25 $19.50
2nd Quarter $ .30 $21.00 $19.00
1st Quarter $20.50 $19.00
Period 1998
4th Quarter $ .30 $21.50 $18.00
3rd Quarter $23.00 $19.50
2nd Quarter $ .29 $22.50 $20.50
1st Quarter $23.00 $20.50
(b) Holders
On December 31, 1999, there were 500 shareholders of record of the
Company's common stock.
(c) Dividends
Pursuant to Mississippi law, the Company's Board of Directors may
authorize the Company to pay cash dividends to its shareholders. The only
limitation on such a dividend is that no distribution may be made if, after
giving effect to the distribution (a) the Company would not be able to pay its
debts as they come due in the usual course of business, or (b) the Company's
total assets would be less than the sum of its total liabilities plus the amount
that would be needed, if the Company were to be dissolved at the time of the
distribution, to satisfy the preferential rights upon dissolution of any
shareholders whose preferential rights are superior to those receiving the
distribution.
The principal source of the Company's cash revenues, however, are
dividends from the Bank. There are certain limitations under federal law on the
payment of dividends by national banks. Under federal law, the directors of a
national bank, after making proper deduction for all expenses and other
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deductions required by the Comptroller, may credit net profits to the bank's
undivided profits account, and may declare a dividend from that account of so
much of the net profits as they judge expedient.
The prior approval of the Comptroller is required, however, if the
total of all dividends declared by a national bank in any calendar year will
exceed the sum of such bank's net profits for that year and its retained net
profits for the preceding two calendar years, less any required transfers to
surplus. Federal law also prohibits national banks from paying dividends which
would be greater than the bank's undivided profits after deducting statutory bad
debt in excess of the bank's allowance for loan losses. Finally, FDICIA
generally prohibits a depository institution from making any capital
distribution to its holding company if the depository institution would
thereafter be "undercapitalized."
In addition, both the Company and the Bank are subject to various
regulatory policies and requirements relating to the payment of dividends,
including requirements to maintain adequate capital above regulatory minimums.
The appropriate federal regulatory authority is authorized to determine under
certain circumstances relating to the financial condition of a national bank or
bank holding company that the payment of dividends would be an unsafe or unsound
practice and to prohibit payment thereof. The Comptroller has indicated that
paying dividends that deplete a national bank's capital base to an inadequate
level would be an unsound and unsafe banking practice. The Comptroller and the
Federal Reserve Board have each indicated that banking organizations should
generally pay dividends only out of current operating earnings. The Bank's
ability to pay dividends is also limited by prudence, statutory and regulatory
guidelines, and a variety of other factors.
Further, in connection with the acquisition of Natchez First Federal in
1993, the Bank assumed a liquidation account of approximately $2.8 million which
has the effect of prohibiting the payment of dividends if the Bank's net worth
would thereby be reduced below the amount required for the liquidation account.
Management does not anticipate that this restriction will have a material
adverse effect on the Bank's ability to pay dividends to the Company.
The Company has declared semiannual cash dividends in each of the last
three fiscal years totaling, on an annual basis, $.56 per share for 1997, $.59
per share for 1998 and $.60 per share for 1999. Historical dividend payout
ratios, expressed as a percentage of net income, for 1997 to 1999 were 41.27%,
44.72% and 47.75%, respectively.
The declaration of future dividends is at the discretion of the Company
and generally will be dependent upon the earnings of the Bank, the assessment of
capital requirements, considerations of safety and soundness, applicable law and
regulation and other factors. Subject to the limitations set forth above, it is
the present policy of the Board of Directors of the Company to continue the
declaration of cash dividends on the Company's Common Stock on a semiannual
basis, to the extent practicable.
Retained earnings of the Bank available for payment of cash dividends
under applicable dividend regulations exceeded $2.4 million as of December 31,
1999, although the Bank intends to retain most of these funds for capital and
not pay them out as dividends.
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Item 6. Management's Discussion and Analysis or Plan of Operation.
The information required in response to this item is incorporated
herein by reference to pages 36 through 44 of the Annual Report, which are
included in Exhibit 13 to this report.
Item 7. Financial Statements.
The following consolidated financial statements of the Company and the
Bank are incorporated herein by reference to pages 4 through 10 of the Annual
Report, which are included in Exhibit 13 to this report.
- Independent Auditor's Report;
- Consolidated Statements of Financial Condition - December 31, 1999
and 1998;
- Consolidated Statements of Income-Years ended December 31, 1999 and
1998;
- Consolidated Statements of Changes in Stockholders' Equity - Years
ended December 31, 1999 and 1998;
- Consolidated Statements of Cash Flows-Years ended December 31, 1999
and 1998;
and
- Notes to the Consolidated Financial Statements.
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act.
The information required in response to this item is incorporated
herein by reference to the material under the heading "Election of Directors" of
the Proxy Statement.
Item 10. Executive Compensation.
The information required in response to this item is incorporated
herein by reference to the material under the heading "Executive Compensation"
of the Proxy Statement.
Item 11. Security Ownership of Certain Beneficial Owners and Management.
The information required in response to this item is incorporated
herein by reference to the material under the headings "Stock ownership of
Directors, Officers, and Principal Shareholders", "Employment Agreements" and
"Section 16(a) Beneficial Ownership Reporting Compliance" of the Proxy
Statement.
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Item 12. Certain Relationships and Related Transactions.
The information required in response to this item is incorporated
herein by reference to the material under the heading "Certain Relationships and
Related Transactions" of the Proxy Statement.
Item 13. Exhibits, List and Reports on Form 8-K.
(a) Exhibits
The response to this portion of Item 13 is submitted as the Exhibit
Index attached hereto and incorporated herein by this reference.
(b) Reports on Form 8-K
The Company filed a report on Form 8-K, dated December 20, 1999,
reporting third quarter 1999 earnings.
The Company filed a report on Form 8-K, dated December 20, 1999,
announcing a semi- annual dividend.
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SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
BRITTON & KOONTZ CAPITAL CORPORATION
(Registrant)
By: /s/ W. Page Ogden
----------------------------
W. Page Ogden
President and
Chief Executive Officer
In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
Signature Title Date
/s/ W. Page Ogden President, March 31, 2000
- ----------------------------------- Chief Executive
W. Page Ogden Officer and Director
(Principal Executive Officer)
/s/ W. W. Allen, Jr. Director March 31, 2000
- -----------------------------------
W. W. Allen, Jr.
/s/ Craig A. Bradford Director March 31, 2000
- -----------------------------------
Craig A. Bradford, DMD
/s/ James J. Cole Director March 31, 2000
- -----------------------------------
James J. Cole
{SIGNATURES CONTINUE ON FOLLOWING PAGE}
S-1
<PAGE>
Signature Title Date
/s/ Wilton R. Dale Director March 31, 2000
- ---------------------------------------
Wilton R. Dale
/s/ William J. Feltus, Jr. Chairman and March 31, 2000
- -------------------------- Director
William J. Feltus, Jr.
/s/ A. J. Ferguson Director March 31, 2000
- -----------------------------------
A. J. Ferguson
/s/ C. Hayden Kaiser, Jr. Vice Chairman March 31, 2000
- -------------------------- and Director
Hayden Kaiser, Jr.
/s/ Donald E. Killelea Director March 31, 2000
- -----------------------------------
Donald E. Killelea, M.D.
/s/ Bazile R. Lanneau, Sr. Director March 31, 2000
- -----------------------------------
Bazile R. Lanneau, Sr.
/s/ Bazile R. Lanneau, Jr. Vice President, Chief March 31, 2000
- ----------------------------------- Financial Officer, Treasurer,
Bazile R. Lanneau, Jr Assistant Secretary and Director
(Principal Financial Officer)
(Principal Accounting Officer)
.
/s/ Albert W. Metcalfe Secretary and March 31, 2000
- -------------------------- Director
Albert W. Metcalfe
/s/ Bethany L. Overton Director March 31, 2000
- --------------------------
Bethany L. Overton
/s/ Robert R. Punches Director March 31, 2000
- --------------------------
Robert R. Punches
S-2
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</TABLE>
EXHIBITS TO ANNUAL REPORT ON FORM 10-KSB
OF BRITTON & KOONTZ CAPITAL CORPORATION
FOR THE FISCAL YEAR
ENDED DECEMBER 31, 1999
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EXHIBIT INDEX
Exhibit / Description of Exhibit
3.1 (*)
Restated Articles of Incorporation of Britton & Koontz Capital Corporation,
incorporated by reference to Exhibit 4.1 to Registrant's Registration Statement
on Form S-8, Registration No. 333-20631, filed with the Commission on January
29, 1997.
3.2 (*)
By-Laws of Britton & Koontz Capital Corporation, as amended and restated,
incorporated by reference to Exhibit 3.2 to Registrant's Annual Report on Form
10-KSB filed with the Commission on March 30, 1998.
4.1 (*)
Certain provisions defining the rights of Shareholders are found in the Articles
of Incorporation and By-Laws of Britton & Koontz Capital Corporation. See
Exhibits 3.1 and 3.2, above.
4.2 (*)
Shareholder Rights Agreement dated June 1, 1996 between Britton & Koontz Capital
Corporation and Britton & Koontz First National Bank, as Rights Agent,
incorporated by reference to Exhibit 4.3 to Registrant's Registration Statement
on Form S-8, Registration No. 333-20631, filed with the Commission on January
29, 1997.
10.01 (*)
Employment Agreement dated December 31, 1996, between Britton & Koontz Capital
Corporation and W. Page Ogden, incorporated by reference to Exhibit 10.1 to
Registrant's Annual Report on Form 10-KSB filed with the Commission on March 28,
1997.
10.02 (*)
Employment Agreement dated December 31, 1996, between Britton & Koontz Capital
Corporation and Bazile R. Lanneau, Jr., incorporated by reference to Exhibit
10.2 to Registrant's Annual Report on Form 10-KSB filed with the Commission on
March 28, 1997.
10.03 (*)
Employment Agreement dated December 31, 1998, between Britton & Koontz Capital
Corporation and James J. Cole, incorporated by reference to Exhibit 10.03 to
Registrant's Annual Report on Form 10-KSB filed with the Commission on March 30,
1999.
10.04 (*)
Salary Continuation Plan Agreements dated September 26, 1994, between Britton &
Koontz Capital Corporation and W. Page Ogden, Bazile R. Lanneau, Jr. and James
J. Cole, incorporated by reference to Exhibit 10 to Registrant's Current Report
on Form 10-QSB filed with the Commission on November 14, 1994.
<PAGE>
10.05 (*)
System Purchase Agreement dated January 22, 1996 between the Britton & Koontz
First National Bank and InterBank Systems, Inc., incorporated by reference to
Exhibit 10.5 to Registrant's Annual Report on Form 10-KSB filed with the
Commission on March 29, 1996 and Form 10- KSB/A, Amendment Number 1, filed with
the Commission on June 14, 1996.
10.06 (*)
Independent Contractor Agreement dated January 22, 1996 between InterBank
Systems, Inc. and Summit Research, Inc., incorporated by reference to Exhibit
10.6 to Registrant's Annual Report on Form 10-KSB filed with the Commission on
March 29, 1996 and Form 10-KSB/A, Amendment Number 1, filed with the Commission
on June 14, 1996.
10.07 (*)
Britton & Koontz Capital Corporation Long-Term Incentive Compensation Plan and
Amendment, incorporated by reference to Exhibit 4.4 to Registrant's Registration
Statement on Form S-8, Registration No. 333-20631, filed with the Commission on
January 29, 1997.
10.09 (*)
Stock Purchase Agreement dated December 3, 1998, between Britton & Koontz
Capital Corporation and Sumx Inc. incorporated by reference to Exhibit 10.09 to
Registrant's Annual Report on Form 10-KSB filed with the Commission on March 30,
1999.
10.10 (*)
Investor Rights Agreement dated December 3, 1998, among Britton & Koontz Capital
Corporation, Summit Research, Inc., Bazile R. Lanneau, Jr. and Sumx Inc.
incorporated by reference to Exhibit 10.10 to Registrant's Annual Report on Form
10-KSB filed with the Commission on March 30, 1999.
10.11 (*)
Voting Agreement dated December 3, 1998, among Britton & Koontz Capital
Corporation, Summit Research, Inc. and Bazile R. Lanneau, Jr. incorporated by
reference to Exhibit 10.11 to Registrant's Annual Report on Form 10-KSB filed
with the Commission on March 30, 1999.
10.12 (*)
Management Service Agreement dated December 3, 1998, among Britton & Koontz
Capital Corporation, Sumx Inc. and Bazile R. Lanneau, Jr. incorporated by
reference to Exhibit 10.12 to Registrant's Annual Report on Form 10-KSB filed
with the Commission on March 30, 1999.
11
Statement re: computation of per share earnings
13
Annual Report to shareholders for fiscal year 1999
<PAGE>
21
Subsidiaries of the Registrant
23.1
Consent of Independent Auditors
27
Financial Data Schedule
As indicated by (*) , this exhibit is incorporated by reference to another
filing or document.
EXHIBIT 11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
Twelve Months Ended
December 31
1999 1998
---- ----
Basic:
<S> <C> <C>
Average shares outstanding: 1,767,064 1,767,064
Net effect of the assumed exercise of stock
options-based on the treasury stock method using
average stock prices 0 0
---------- ----------
Total 1,767,064 1,767,064
========== ==========
Net Income $2,220,236 $2,331,520
========== ==========
Net income per share $1.26 $1.32
========== ==========
Diluted:
Average shares outstanding: 1,767,064 1,767,064
Net effect of the assumed exercise of stock options
based on the treasury stock method using average
market price. 0 1,636
---------- ----------
Total 1,767,064 1,768,700
========== ==========
Net income $2,220,236 $2,331,520
========== ==========
Net income per share $1.26 $1.32
========== ==========
</TABLE>
EXHIBIT 21
SUBSIDIARIES OF THE REGISTRANT
The following is a list of subsidiaries of the Company at December 31,
1999 and all are included in the Company's consolidated financial statements:
Jurisdiction Percentage of
of Voting Securities
Subsidiaries Incorporation Owned
Britton & Koontz First National Bank Federal Law 100%
Sumx Inc. Federal Law 35%
NOTES
Both Subsidiaries are included in the consolidated financial statements. Both
Subsidiaries conduct business under their own name.
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report (Form 10-KSB)
of Britton & Koontz Capital Corporation and Subsidiary of our report dated
January 14, 2000, included in the 1999 Annual Report to Shareholders of Britton
& Koontz Capital Corporation and Subsidiary.
/s/ May & Company
Vicksburg, Mississippi
March 27, 1999
<TABLE> <S> <C>
<ARTICLE> 9
<CIK> 0000707604
<NAME> Britton & Koontz First National Bank
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> Dec-31-1999
<PERIOD-START> Jan-31-1999
<PERIOD-END> Dec-31-1999
<CASH> 5,586,693
<INT-BEARING-DEPOSITS> 140,745,125
<FED-FUNDS-SOLD> 875,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 4,263,618
<INVESTMENTS-CARRYING> 46,553,344
<INVESTMENTS-MARKET> 45,536,865
<LOANS> 139,140,966
<ALLOWANCE> 835,576
<TOTAL-ASSETS> 208,853,852
<DEPOSITS> 166,294,091
<SHORT-TERM> 19,332,445
<LIABILITIES-OTHER> 3,075,575
<LONG-TERM> 0
0
0
<COMMON> 4,417,660
<OTHER-SE> 15,734,081
<TOTAL-LIABILITIES-AND-EQUITY> 208,853,852
<INTEREST-LOAN> 11,186,884
<INTEREST-INVEST> 2,919,220
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 14,106,104
<INTEREST-DEPOSIT> 5,286,530
<INTEREST-EXPENSE> 5,860,425
<INTEREST-INCOME-NET> 8,245,679
<LOAN-LOSSES> 275,000
<SECURITIES-GAINS> 4,385
<EXPENSE-OTHER> 6,356,382
<INCOME-PRETAX> 3,334,797
<INCOME-PRE-EXTRAORDINARY> 2,220,236
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,220,236
<EPS-BASIC> 1.26
<EPS-DILUTED> 1.26
<YIELD-ACTUAL> 7.84
<LOANS-NON> 411,000
<LOANS-PAST> 306,000
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 746,738
<CHARGE-OFFS> 222,734
<RECOVERIES> 36,573
<ALLOWANCE-CLOSE> 835,576
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
