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<PAGE>
FORM 8-K/A
(Amendment No. 1)
Securities and Exchange Commission
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): October 16, 1998
Surety Capital Corporation
------------------------------------------------------
(exact name of registrant as specified in its charter)
Delaware 33-1983 75-2065607
- --------------- ------------------------ --------------
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) Number)
1845 Precinct Line Road, Suite 100, Hurst, Texas 76054
-------------------------------------------------------
(address of principal executive offices)
Registrant's telephone number, including area code: (817) 498-2749
Not applicable
-------------------------------------------------------------
(Former name or former address, if changed since last report)
PAGE
<PAGE>
Item 7. Financial Statements and Exhibits.
(b) Pro Forma Financial Information.
The following pro forma financial statements are included with
this Form 8-K:
Pro Forma Balance Sheet as of September 30, 1998 F-1
Pro Forma Income Statement for the Nine Months F-2
Ended September 30, 1998 and for the Twelve
Months Ended December 31, 1997
(c) Exhibits.
The following exhibits are furnished in accordance with the
provisions of Item 601 of Regulation S-K:
10 Branch Purchase and Assumption Agreement by and between
Surety Bank, National Association and Commercial Bank of
Texas, National Association, dated July 13, 1998. *
* Filed with the Registrant's Current Report on Form 8-K
for event dated July 13, 1998.
PAGE
<PAGE>
SIGNATURES
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.
SURETY CAPITAL CORPORATION
DATE: November 18, 1998 /s/ Bobby W. Hackler
--------------------
Bobby W. Hackler
Chairman of the Board
-2-
PAGE
<PAGE>
PRO FORMA BALANCE SHEET
as of September 30, 1998
<TABLE>
<CAPTION>
Sale of
Surety Lufkin
Capital Area Pro Forma
Corporation Branches Debits Credits Combined
------------- ------------- ---------- ---------- -------------
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
Assets:
Cash and due from banks $ 9,054,812 $ (1,007,738) $1,702,762(A) $ 9,749,836
Federal funds sold 50,497,554 (44,326,837) 6,170,717
------------- ------------- ---------- ---------- -------------
Cash and cash equivalents 59,552,366 (45,334,575) 1,702,762 15,920,553
Interest bearing deposits in
Financial institutions 94,939 - 94,939
Investment securities 32,170,862 - 32,170,862
Net loans 118,976,740 (10,918,896) 108,057,844
Medical claims receivables, net 680,505 - 680,505
Premises and equipment, net 7,534,164 (603,995) 6,930,169
Accrued interest receivable 1,176,553 (58,861) 1,117,692
Other real estate and
Repossessed assets 739,343 - 739,343
Deferred tax asset 1,875,789 - 1,875,789
Other assets 1,849,952 (19,053) 1,830,899
Excess of cost over fair value
of net assets acquired, net 9,697,493 (476,099)(A) 9,221,394
------------- ------------- ---------- ---------- -------------
Total assets $ 234,348,706 $(56,935,380) 1,226,663 $ 178,639,989
============= ============= ========== ========== =============
Liabilities:
Demand deposits $ 37,268,448 $ (5,912,234) $ 31,356,214
Savings, NOW and
money markets 61,510,203 (15,646,319) 45,863,884
Time deposits, $100,000 and over 35,004,547 (11,048,099) 23,956,448
Other time deposits 79,589,139 (24,152,086) 55,437,053
------------- ------------- ---------- ---------- -------------
Total deposits 213,372,337 (56,758,737) 156,613,600
Accrued interest payable and
other liabilities 987,243 (176,643) 683,635(A) 1,474,235
Convertible subordinated debt 4,350,000 - 4,350,000
------------- ------------- ---------- ---------- -------------
Total liabilities 218,709,580 (56,935,380) 683,635 162,437,835
------------- ------------- ---------- ---------- -------------
Shareholders' equity:
Common stock 58,401 - 58,401
Additional paid in capital 17,093,786 - 17,093,786
Retained earnings (1,326,261) - 543,029(A) (783,233)
Stock rights issuable 57,902 - 57,902
Treasury stock (375,443) - (172,828)
Unrealized gain/(loss) on
available-for-sale securities 130,741 - 130,741
------------- ------------- ---------- ---------- -------------
Total equity 15,639,126 - 543,029 16,202,154
------------- ------------- ---------- ---------- -------------
Total liabilities and equity $ 234,348,706 $(56,935,380) $1,226,663 $ 178,639,989
============= ============= ========== ========== =============
</TABLE>
(A) To record sale of certain assets and certain liabilities of the
branches located in Chester, Kennard, Lufkin and Wells, Texas.
The sales price was based on a fixed price of 3% of the qualified
deposits, subject to adjustments. The recognition of the sale
includes elimination of the goodwill associated with these branches
and an accrual for federal income taxes on the gross proceeds.
F-1
PAGE
<PAGE>
PRO FORMA INCOME STATEMENT
for the nine months ended September 30, 1998
<TABLE>
<CAPTION>
Sale of Pro Forma
Surety Lufkin Adjustments
Capital Area ---------------------- Pro Forma
Corporation Branches Debits Credits Combined
------------ ------------ --------- --------- -------------
(unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans $ 8,619,631 $ (993,077) $ - $ - $ 7,626,554
Medical claims receivable factoring 1,457,520 - 1,457,520
Interest on federal funds sold 1,407,009 (1,012,727) - - 394,282
Interest on securities and interest
Bearing deposits 1,628,993 (700,000) - - 928,993
------------ ------------ --------- --------- -------------
Total interest income 13,113,153 (2,705,804) - - 10,407,349
------------ ------------ --------- --------- -------------
Interest expense:
Interest on deposits 5,336,099 (1,647,093) - - 3,689,006
Interest expense on borrowings 191,949 - - - 191,949
------------ ------------ --------- --------- -------------
Total interest expense 5,528,048 (1,647,093) - - 3,880,955
------------ ------------ --------- --------- -------------
Net interest income before
provision for credit losses 7,585,105 (1,058,711) - - 6,526,394
Provision for credit losses and
medical claims receivables losses 1,638,119 (13,000) - - 1,625,119
------------ ------------ --------- --------- -------------
Net interest income 5,946,986 (1,045,711) - - 4,901,275
------------ ------------ --------- --------- -------------
Non interest income 1,953,425 (314,901) - - 1,638,524
------------ ------------ --------- --------- -------------
Non interest expense:
Salaries and employee benefits 4,206,919 (548,072) - - 3,658,847
Occupancy & equipment 1,467,719 (171,346) - - 1,296,373
General & administrative 2,735,872 (229,080) - - 2,506,792
------------ ------------ --------- --------- -------------
Total noninterest expense 8,410,510 (948,498) - - 7,462,012
------------ ------------ --------- --------- -------------
Income before income taxes (510,099) (412,114) - - (922,213)
Income tax expense: (208,273) (148,361) - - (356,634)
------------ ------------ --------- --------- -------------
Net income $ (301,826) $ (263,753) $ - $ - $ (565,579)
============ ============ ========= ========= =============
Basic earnings (loss) per share of
Common stock $ (0.05) $ (0.10)
Weighted average shares outstanding 5,758,931 5,758,931
Diluted earnings per share of common stock $ (0.05) $ (0.10)
Weighted average shares outstanding
and common stock equivalents 5,999,426 5,999,426
</TABLE>
F-2
PAGE
<PAGE>
PRO FORMA INCOME STATEMENT
for the twelve months ended December 31, 1997
<TABLE>
<CAPTION>
Sale of Pro Forma
Surety Lufkin Adjustments
Capital Area ---------------------- Pro Forma
Corporation Branches Debits Credits Combined
------------ ------------ --------- --------- -------------
(unaudited)
<S> <C> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans $ 11,119,540 $(1,245,738) $ - $ - $ 9,873,802
Medical claims receivable factoring 1,477,510 - 1,477,510
Interest on federal funds sold 516,340 (500,000) - - 16,340
Interest on securities and interest
Bearing deposits 2,319,295 (1,873,351) - - 445,944
------------ ------------ --------- --------- -------------
Total interest income 15,432,685 (3,619,089) - - 11,813,596
------------ ------------ --------- --------- -------------
Interest expense:
Interest on deposits 5,749,798 (2,121,143) - - 3,628,655
Interest expense on borrowings - - - - -
------------ ------------ --------- --------- -------------
Total interest expense 5,749,798 (2,121,143) - - 3,628,655
------------ ------------ --------- --------- -------------
Net interest income before
provision for credit losses 9,682,887 (1,497,946) - - 8,184,941
Provision for credit losses and
medical claims receivables losses 6,384,996 (70,000) - - 6,314,996
------------ ------------ --------- --------- -------------
Net interest income 3,297,891 (1,427,946) - - 1,869,945
------------ ------------ --------- --------- -------------
Non interest income 2,538,918 (447,872) - - 2,091,046
------------ ------------ --------- --------- -------------
Non interest expense:
Salaries and employee benefits 4,748,097 (797,823) - - 3,950,274
Occupancy & equipment 1,517,662 (277,921) - - 1,239,741
General & administrative 3,649,136 (266,116) - - 3,383,020
Impairment of long lived assets 1,198,288 - - - 1,198,288
------------ ------------ --------- --------- -------------
Total noninterest expense 11,113,183 (1,341,860) - - 9,771,323
------------ ------------ --------- --------- -------------
Income before income taxes (5,276,374) (533,958) - - (5,810,332)
Income tax expense: (1,800,070) (192,225) - - (1,992,295)
------------ ------------ --------- --------- -------------
Net income $ (3,476,304) $ (341,733) $ - $ - $ (3,818,037)
============ ============ ========= ========= =============
Basic earnings (loss) per share of
Common stock $ (0.60) $ (0.66)
Weighted average shares outstanding 5,751,847 5,751,847
Diluted earnings per share of common stock $ (0.60) $ (0.66)
Weighted average shares outstanding
and common stock equivalents 5,990,815
</TABLE>
F-3
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