As filed with the Securities and Exchange Commission on February 23, 1998.
Registration No. 333-_____.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CAROLINA FIRST CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
SOUTH CAROLINA 6711 57-0824914
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
102 SOUTH MAIN STREET
GREENVILLE, SOUTH CAROLINA 29601
(864) 255-7900
(Address, including ZIP code, and telephone
number, including area code, of
registrant's principal executive
offices)
WILLIAM S. HUMMERS III, EXECUTIVE VICE PRESIDENT
CAROLINA FIRST CORPORATION
102 SOUTH MAIN STREET
GREENVILLE, SOUTH CAROLINA 29601
(864) 255-7913
(Name, address, including ZIP code, and
telephone number, including area
code, of agent for service)
Copies to:
WILLIAM P. CRAWFORD, JR., ESQ.
WYCHE, BURGESS, FREEMAN & PARHAM, P.A.
POST OFFICE BOX 728
GREENVILLE, SOUTH CAROLINA 29602-0728
(864) 242-8200 (TELEPHONE) (864) 235-8900 (FACSIMILE)
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective. If the
securities being registered on this form are being offered pursuant to dividend
or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following
box and list the Securities Act registration statement number of earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===============================================================================================================================
Proposed Maximum Proposed Maximum Amount
Title of Each Class Amount to Offering Price Aggregate of Registration
of Securities to be Registered be Registered Per Unit (1) Offering Price Fee (1)
- ------------------------------ ------------- ------------ -------------- -------
<S> <C> <C> <C> <C>
Common Stock 2,000,000 $23.37 $46,740,000 $13,788.30
(par value $1.00 per share)
==============================================================================================================================
</TABLE>
(1) Determined pursuant to Rule 457(c) under the Securities Act of 1933, as
amended solely for the purpose of determining the registration fee.
Pursuant to Rule 457(c), the Proposed Maximum Offering Price has been
determined based on the average of the high and low sales prices of shares
of Carolina First Corporation Common Stock reported on the Nasdaq National
Market on February 18, 1998.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE>
Prospectus,
February 23, 1998
CAROLINA FIRST CORPORATION
Prospectus for 2,000,000 Shares of Common Stock $1.00 Par Value
to be sold by Certain Selling Shareholders
This Prospectus relates to the sale (the "Offering") of up to 2,000,000 shares
of common stock, $1.00 par value (the "Common Stock") of Carolina First
Corporation ("Carolina First Corporation" or the "Company"). All 2,000,000
shares of Common Stock being offered hereby (the "Shares") are being sold by
those certain selling shareholders (collectively, the "Selling Shareholders")
set forth herein under the section entitled "THE SELLING SHAREHOLDERS." The
Common Stock is traded on the Nasdaq National Market under the Nasdaq market
symbol "CAFC." On February 18, 1998, the closing sales price of the Common
Stock, as reported by the Nasdaq Stock Market, was $23.25 per share.
------------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 8 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY POTENTIAL PURCHASERS OF THE
SHARES.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-------------------------
THE CAROLINA FIRST CORPORATION SHARES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS,
DEPOSITS OR OTHER OBLIGATIONS OF A BANK OR SAVINGS AND LOAN ASSOCIATION AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR OTHER GOVERNMENTAL
AGENCY.
- ------------------------------------------------------------------------------
Underwriting
Price to Discounts And Proceeds to Issuer
Public Commissions Or Other Persons
- -------------------------------------------------------------------------------
Per Unit ........ (1) (2) (3)
Total ........... (1) (2) (3)
- -------------------------------------------------------------------------------
(1) It is expected that any sales made pursuant to this Prospectus will be
effected by the Selling Shareholders on the Nasdaq National Market,
including ordinary broker's transactions, in privately-negotiated
transactions or through sales to one or more broker/dealers for resale
of such Shares as principals or a combination of any such methods of
sale, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. See
"PLAN OF DISTRIBUTION."
(2) The Shares may be sold directly or through underwriters, dealers or
agents. Usual and customary or specifically negotiated brokerage or
underwriting fees, commissions or discounts may be paid by the Selling
Shareholders in connection with such sales. See "PLAN OF DISTRIBUTION."
(3) The Company will receive no proceeds from the sale of the Shares. The
Selling Shareholders will receive all proceeds from the sale of the
Shares, net of any underwriting fees, commissions or discounts that may
be payable.
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AVAILABLE INFORMATION
Carolina First Corporation is subject to the informational requirements
of the Securities Exchange Act of 1934, as amended ("Exchange Act") and, in
accordance therewith, file reports, proxy statements and other information with
the Securities and Exchange Commission ("Commission"). Such reports, proxy
statements and other information filed with the Commission may be inspected and
copied at the public reference facilities maintained by the Commission at Room
1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the following Regional Offices of the Commission: New York Regional Office, 7
World Trade Center, Suite 1300, New York, New York 10048 and Chicago Regional
Office, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
such material may also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, upon the payment
of fees at prescribed rates. The Commission maintains a Web site
(http://www.sec.gov) that contains reports, proxy and information statements and
other information regarding registrants (including Carolina First Corporation)
that file electronically with the Commission.
Carolina First Corporation has filed with the Commission a Registration
Statement (which shall include any amendments thereto) on Form S-3
("Registration Statement") under the Securities Act of 1933, as amended
("Securities Act"), with respect to the Shares offered hereby. This Prospectus
does not contain all the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. The Registration Statement and the exhibits and schedules
thereto are available for inspection and copying as set forth in the preceding
paragraph. For further information with respect to Carolina First Corporation
and the Shares offered hereby, reference is hereby made to the Registration
Statement, including the exhibits and schedules thereto.
All information contained or incorporated by reference in this
Prospectus with respect to Carolina First Corporation has been supplied by
Carolina First Corporation.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WITH RESPECT TO
CAROLINA FIRST CORPORATION WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH.
COPIES OF ANY SUCH DOCUMENTS (OTHER THAN EXHIBITS TO SUCH A DOCUMENT UNLESS SUCH
EXHIBIT IS SPECIFICALLY INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS) ARE
AVAILABLE WITHOUT CHARGE TO ANY PERSON TO WHOM THIS PROSPECTUS IS DELIVERED UPON
ORAL OR WRITTEN REQUEST TO WILLIAM S. HUMMERS III, EXECUTIVE VICE PRESIDENT,
CAROLINA FIRST CORPORATION, 102 SOUTH MAIN STREET, GREENVILLE, SC 29601,
TELEPHONE NUMBER (864) 255-7900.
The following documents filed with the Commission by Carolina First
Corporation pursuant to Section 13(a) or 15(d) of the Exchange Act are
incorporated herein by reference:
(i) Carolina First Corporation's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996;
(ii) Carolina First Corporation's Quarterly Reports on Form 10-Q
for the quarters ended March 31, 1997, June 30, 1997, and
September 27, 1997;
(iii) Carolina First Corporation's Current Reports on Form 8-K
dated December 18, 1996, July 11, 1997, November 21, 1997,
December 1, 1997, February 13, 1998 and February 23, 1998;
and
(iv) The description of the Carolina First Corporation common
stock which is contained in Carolina First Corporation's Form
8-A filed with the Commission on or about October 20, 1986,
including any amendment or report filed for the purpose of
updating such description.
All documents filed by Carolina First Corporation pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
termination of this Offering shall be deemed to be incorporated by reference
into this Prospectus and to be a part hereof from the respective dates of filing
of such documents. Any statement contained herein, or in a previously-filed
document incorporated herein, shall be deemed to be modified or superseded for
purposes of this Prospectus to the extent that a statement contained herein, or
in any other previously-filed document which also is incorporated by reference
herein, is modified or superseded by a statement in a subsequently-filed
document. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
2
<PAGE>
OTHER INFORMATION
No person is authorized to give any information or to make any
representation not contained in or incorporated by reference in this Prospectus,
and, if given or made, such information or representation must not be relied
upon as having been authorized by Carolina First Corporation. This Prospectus
does not constitute an offer to sell, or a solicitation of an offer to buy, any
of the securities offered hereby to any person or in any jurisdiction in which
such offer or solicitation is not authorized or in which the person making such
offer or solicitation is not qualified to do so, or to any person to whom it is
unlawful to make such offer or solicitation in such jurisdiction. Neither the
delivery of this Prospectus nor any sale hereunder shall under any circumstances
create any implication that the information contained herein is correct as of
any date subsequent to the date hereof or that there has been no change in the
affairs of Carolina First Corporation since such date.
3
<PAGE>
THE COMPANY
GENERAL
The Company is a bank holding company headquartered in Greenville,
South Carolina which engages in a general banking business through its four
Operating Subsidiaries: (1) Carolina First Bank, a South Carolina-chartered bank
headquartered in Greenville, South Carolina, (2) Carolina First Mortgage Company
("CF Mortgage"), a mortgage loan origination and servicing company headquartered
in Columbia, South Carolina, (3) Blue Ridge Finance Company, Inc. ("Blue
Ridge"), an automobile finance company headquartered in Greenville, South
Carolina, and (4) CF Investment Company ("CF Investment"), a small business
investment company headquartered in Greenville, South Carolina (collectively,
the "Operating Subsidiaries"). Through the Operating Subsidiaries, the Company
provides a full range of banking services, including mortgage, trust and
investment services, which are designed to meet substantially all of the
financial needs of its customers. The Company, which commenced operations in
December 1986, currently conducts business in 65 locations in South Carolina and
is the largest independent South Carolina-headquartered financial institution.
At September 30, 1997, the Company had total assets of approximately $1.76
billion, total loans of approximately $1.29 billion, total deposits of
approximately $1.40 billion and approximately $125 million in shareholders'
equity. Following the Company's acquisition of First Southeast in November 1997
(discussed below), the Company currently has total assets of approximately
$2 billion.
The Company was formed principally in response to opportunities
resulting from the takeovers of several South Carolina-based banks by large
southeastern regional bank holding companies. A significant number of the
Company's executive officers and management personnel were previously employed
by certain of the larger South Carolina-based banks that were acquired by these
southeastern regional institutions. Consequently, these officers and management
personnel have significant customer relationships and commercial banking
experience that have contributed to the Company's loan and deposit growth. The
Company targets individuals and small- to medium-sized businesses in South
Carolina that require a full range of quality banking services typically
provided by larger regional banking concerns, but that prefer the personalized
service afforded by a South Carolina-based institution.
The Company's objective is to be the leading South Carolina-based
banking institution headquartered in the state. It believes that it can
accomplish this goal by being a "super-community" bank which offers both the
personalized service and "relationship" banking typically found in community
banks, as well as the sophisticated banking products offered by the regional and
super-regional institutions. The Company currently serves five principal market
areas: the Anderson metropolitan area and surrounding counties (located in the
upstate region of South Carolina); the Greenville metropolitan area and
surrounding counties (located in the upstate region of South Carolina); the
Columbia metropolitan area and surrounding counties (located in the midlands
region of South Carolina); Georgetown and Horry counties (located in the
northern coastal region of South Carolina); and the Charleston metropolitan area
(located in the central coastal region of South Carolina). The Company's market
areas are located in the four largest Metropolitan Statistical Areas of the
state. Following the acquisition in November 1997 of First Southeast Financial
Corporation ("First Southeast") and its wholly-owned subsidiary, First Federal
Savings and Loan Association of Anderson ("First Federal"), the Company ranked
first in market share in Anderson County, a strategic market located along the
desirable Interstate 85 corridor between Atlanta and Charlotte and the fourth
largest Metropolitan Statistical Area in South Carolina. The Company also has
branch locations in other counties in South Carolina.
The Company began its operations with the de novo opening of Carolina
First Bank in Greenville and has pursued a strategy of growth through internal
expansion and through the acquisition of branch locations and financial
institutions in selected market areas. Its more significant acquisitions include
the acquisition in August 1990 of First Federal Savings and Loan Association of
Georgetown, the acquisition in March 1993 of 12 branch locations of Republic
National Bank, the acquisition in July 1997 of Lowcountry Savings Bank, Inc. and
the acquisition in November 1997 of First Southeast and its wholly-owned
subsidiary First Federal, in which deposits of approximately $285 million were
assumed. Approximately half of the Company's total deposits have been generated
through acquisitions. The Company anticipates that it will continue to expand in
the future and is frequently in discussions regarding possible acquisitions. See
"--Recent Developments."
4
<PAGE>
OPERATING SUBSIDIARIES
Carolina First Bank. Carolina First Bank is a South
Carolina-chartered, non-member bank, which is headquartered in Greenville, South
Carolina. It currently engages in a general banking business through 62
locations, which are located throughout South Carolina. It began its operations
in December 1986 and at September 30, 1997 had total assets of approximately
$1.74 billion, total loans of approximately $1.29 billion and total deposits of
approximately $1.4 billion. Following the acquisition of First Southeast in
November 1997 and the merger of its wholly-owned subsidiary, First Federal, with
and into Carolina First Bank, Carolina First Bank currently has total assets of
approximately $2 billion. Its deposits are insured by the Federal Deposit
Insurance Corporation (the "FDIC"). Carolina First Bank provides a full range of
commercial and consumer banking services, including short and medium-term loans,
mortgage loans, revolving credit arrangements, international banking services,
inventory and accounts receivable financing, equipment financing, real estate
lending, credit card loans, safe deposit services, savings accounts, interest-
and noninterest-bearing checking accounts, home banking and installment and
other personal loans. Carolina First Bank also provides trust services,
investment products and various cash management programs.
CF Mortgage. CF Mortgage is a South Carolina corporation which
principally originates and services one-to-four family mortgage loans through
its six offices located in South Carolina. It is headquartered in Columbia,
South Carolina. At September 30, 1997, CF Mortgage was servicing or subservicing
approximately 16,096 loans having an aggregate principal balance of
approximately $1.5 billion.
Blue Ridge. On December 29, 1995, the Company acquired Blue Ridge, an
automobile finance company headquartered in Greenville, South Carolina. Blue
Ridge operates from one location and, at September 30, 1997, had approximately
$14.3 million in total assets. Blue Ridge is engaged primarily in indirect
automobile lending.
CF Investment. The Company has formed a wholly-owned subsidiary, CF
Investment, which is licensed through the U.S. Small Business Administration to
operate as a Small Business Investment Company. In 1997, the Company capitalized
CF Investment with a contribution of $3.0 million.
CAPITAL ADEQUACY
The Company. The Board of Governors of the Federal Reserve System
(the "Federal Reserve") has adopted risk-based capital guidelines for bank
holding companies. Under these guidelines, the minimum ratio of total capital to
risk-weighted assets (including certain off-balance sheet activities, such as
standby letters of credit) is 8%. At least half of the total capital is required
to be "Tier 1 capital," principally consisting of common stockholders' equity,
noncumulative preferred stock, a limited amount of cumulative perpetual
preferred stock, and minority interests in the equity accounts of consolidated
subsidiaries, less certain goodwill items. The remainder ("Tier 2 capital") may
consist of a limited amount of subordinated debt and intermediate-term preferred
stock, certain hybrid capital instruments and other debt securities, perpetual
preferred stock, and a limited amount of the general loan loss allowance. In
addition to the risk-based capital guidelines, the Federal Reserve has adopted a
minimum Tier 1 (leverage) capital ratio under which a bank holding company must
maintain a minimum level of Tier 1 capital (as determined under applicable
rules) to average total consolidated assets of at least 3% in the case of bank
holding companies which have the highest regulatory examination ratios and are
not contemplating significant growth or expansion. All other bank holding
companies are required to maintain a ratio of at least 100 to 200 basis points
above the stated minimum. At September 30, 1997, the Company was in compliance
with both the risk-based capital guidelines and the minimum leverage capital
ratio.
Carolina First Bank. As a state-chartered, FDIC-insured institution
which is not a member of the Federal Reserve System, Carolina First Bank is
subject to capital requirements imposed by the Federal Deposit Insurance
Corporation (the "FDIC"). The FDIC requires state-chartered nonmember banks to
comply with risk-based capital standards substantially similar to those required
by the Federal Reserve, as described above. The FDIC also requires
state-chartered nonmember banks to maintain a minimum leverage ratio similar to
that adopted by the Federal Reserve. Under the FDIC's leverage capital
requirement, state nonmember banks that (a) receive the highest rating during
the examination process and (b) are not anticipating or experiencing any
significant growth are required to maintain a minimum leverage ratio of 3% of
Tier 1 capital to total assets; all
5
<PAGE>
other banks are required to maintain a minimum ratio of 100 to 200 basis points
above the stated minimum, with an absolute minimum leverage ratio of not less
than 4%. At September 30, 1997, the Company and Carolina First Bank were both in
compliance with each of the applicable regulatory capital requirements.
CAPITAL RATIOS TABLE
- ------------------------------------------------------------------------------
Adequately
As of Well Capitalized Capitalized
9/30/97 Requirement Requirement
- ------------------------------------------------------------------------------
Company:
Total Risk-based Capital 10.28% 10.0% 8.0%
Tier 1 Risk-based Capital 7.39 6.0 4.0
Leverage Ratio 5.78 5.0 4.0
Carolina First Bank:
Total Risk-based Capital 9.83 10.0 8.0
Tier 1 Risk-based Capital 8.88 6.0 4.0
Leverage Ratio 6.92 5.0 4.0
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RECENT DEVELOPMENTS
1997 Earnings and Financial Data
On January 22, 1998, the Company announced its earnings and other
financial data at and for the year ended December 31, 1997. For the year
ended December 31, 1997, the Company's net income totaled $14.3 million, or
$1.18 per diluted share. This represented a 37% increase over 1996's net
income of $10.5 million, or $0.92 per diluted share (or a 28% increase over
1996's net income of $11.2 million, or $0.99 per diluted share, excluding the
one-time special Savings Association Insurance Fund assessment). Fourth quarter
earnings increased to $4.3 million, or $0.32 per diluted share. At December 31,
1997, the Company's total assets, loans, deposits and shareholders' equity were
$2.2 billion, $1.6 billion, $1.7 billion and $202 million, respectively. At
December 31, 1997, the Company's ratio of nonperforming assets to loans was
0.23%.
Regulation S Offering. On February 13, 1998, the Company completed the
sale of 2,000,000 shares of Common Stock at an offering price of $20.50 (the
"Regulation S Offering"), excluding underwriting discounts and offering
expenses. The Regulation S Offering was not registered under the Securities Act.
Rather, the shares offered thereby were sold in a manner so as to meet the
conditions set out in Regulation S promulgated under the Securities Act. The
purchasers in the Regulation S Offering are the Selling Shareholders. In
connection with the Regulation S Offering, the Company undertook to register the
Shares and to keep the Registration Statement to which this Prospectus relates
effective for a period of at least 90 days, subject to extension in certain
instances. The proceeds from the sale of the shares in the Regulation S Offering
are expected to be utilized to provide additional capital to support internal
growth, acquisitions, the expansion of Blue Ridge and for general corporate
purposes. The proceeds from the Regulation S Offering will also permit the
Company to continue to pursue attractive acquisition possibilities while
proceeding with internal growth strategies.
Exercise of Affinity Technology Group, Inc. Warrant. At September 30,
1997, the Company owned 128,366 shares of common stock of Affinity Technology
Group, Inc. ("Affinity") and a warrant to purchase an additional 5,871,340
shares, or approximately 17% of Affinity's outstanding common stock, for
approximately $0.0001 per share ("Affinity Warrant"). At September 30, 1997, the
investment in Affinity's common stock, included in securities available for
sale, was recorded at its market value of $497,000. The Affinity Warrant was not
reported on the Company's balance sheet as of September 30, 1997. On December
29, 1997, the Company exercised a portion of the Affinity Warrant and was issued
2,400,000 shares for an exercise price of $226. At December 31, 1997, the
2,400,000 shares of Affinity were recorded on the Company's balance sheet at
their market value of approximately $6.0 million. As a result of the exercise of
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the Affinity Warrant for 2,400,000 shares, total shareholders' equity of the
Company also increased by approximately $3.8 million.
Acquisition of First Southeast. On November 21, 1997, the Company
acquired First Southeast through the merger of First Southeast with and into an
interim subsidiary of the Company. At September 30, 1997, First Southeast had
total assets of approximately $350 million. In connection with such transaction,
First Federal, a wholly-owned subsidiary of First Southeast, was merged with and
into Carolina First Bank. First Federal had 13 offices located in Anderson,
Greenville, Abbeyville and Greenwood counties in South Carolina which were
converted into Carolina First Bank offices upon consummation of the merger. Two
of Carolina First Bank's branches were subsequently consolidated with two of
First Federal's branches resulting in operating efficiencies. As of September
30, 1997, First Federal had total assets of approximately $350 million, total
loans of approximately $275 million, and total deposits of approximately $285
million. In connection with such acquisition, approximately 3.5 million new
shares of the Common Stock valued at approximately $70 million (as of the
closing date of the acquisition) were exchanged for all outstanding shares of
First Southeast common stock, based on an exchange ratio of 0.7971 of a share
for each share of First Southeast common stock. The transaction was accounted
for as a purchase.
Other Acquisitions. The Company continues to explore opportunities to
acquire banks and other companies engaging in financial institution-related
activities. It is not presently known whether, or on what terms, such
discussions will result in further acquisitions. The Company's acquisition
strategy is flexible in that it does not require the Company to effect specific
acquisitions so as to enter certain markets or to attain specified growth
levels. Rather than being market driven or size motivated, the Company's
acquisition strategy reflects its willingness to consider potential acquisitions
wherever and whenever such opportunities arise based on the then-existing market
conditions and other circumstances. The Company's acquisitions may be made by
the exchange of stock, through cash purchases, or with other consideration. The
Company anticipates that it will continue to expand by acquisition in the
future.
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RISK FACTORS
The Shares being offered hereby involve certain risks and are suitable
only for persons who can afford to bear such risks. The following risk factors,
in addition to the other information discussed elsewhere in this Prospectus,
should be considered carefully by investors in deciding whether to purchase the
Shares.
ACQUISITION OF FIRST SOUTHEAST
The acquisition of First Southeast represented the Company's largest
acquisition to date. Any problems encountered by the Company in assimilating
First Southeast and its operations into the Company's banking operations could
have a material adverse effect on the Company, its operations and earnings.
These could include, among others, problems related to the inability to
profitably deploy and redeploy First Southeast's assets (including the mortgage
loans as discussed below), the inability to retain deposits and depositor
relationships, the inability to retain loan customers, and the inability to
retain key First Southeast and First Federal employees.
The Company intends to sell into the secondary market approximately
$150,000,000 of First Southeast's mortgage loans and redeploy the proceeds into
higher-yielding loans. The new portfolio of higher-yielding loans should more
closely resemble a commercial bank loan portfolio. The Company's earnings may be
materially and adversely affected by the timing of such redeployment as well as
by the rate earned and the charge-offs on the redeployed proceeds.
CREDIT CARD CHARGE-OFFS
During 1997, net charge-offs for credit cards were at a higher level
than those historically experienced and had a material adverse effect on the
Company's 1997 earnings. The Company carefully monitors past due trends in the
credit card portfolio and is examining various options for its credit card
portfolio to decrease the level of charge-offs. The Company's credit card
charge-offs may continue to exceed industry averages and could continue to have
a material adverse effect on the Company's earnings.
LITIGATION
On November 4, 1996, a derivative shareholder action was filed in
Greenville County Court of Common Pleas against the Company, the majority of the
Company's and Carolina First Bank's directors and certain executive and other
officers. The named plaintiffs are the Company by and through certain minority
shareholders. The Company filed a motion to dismiss with respect to all claims
in this complaint, which was granted in December 1997. Plaintiffs have filed a
motion for reconsideration and have the right to appeal the grant of the motion
to dismiss. Plaintiffs allege as causes of action the following: conversion of
corporate opportunity; fraud and constructive fraud; breach of fiduciary duty
and constructive fiduciary fraud; and negligent management. The factual basis
upon which these claims are made generally involves the payment to Company
officers and other individuals of a bonus in stock held by the Company in
Affinity (as a reward for their efforts in connection with the Company's
procurement of stock in Affinity), statements to former Midlands National Bank
("Midlands") shareholders in connection with the Company's acquisition of
Midlands, alleged misstatements in the Company's public filings, transactions
between the Company and entities affiliated with a former director, and alleged
mismanagement by certain executive officers involving financial matters and
employee matters. The complaint seeks damages for the benefit of the Company
aggregating $41 million and recision of the Affinity bonus.
In an action instituted by the same attorneys bringing the
above-mentioned derivative action, on December 31, 1996, certain individuals
filed a class action lawsuit against the Company, Carolina First Bank, and a
number of officers and directors of the Company and Carolina First Bank. In
connection with the judge's granting of the motion to dismiss in the
above-referenced derivative action, the plaintiff's attorney has agreed to
withdraw this lawsuit, without prejudice. In this class action lawsuit,
plaintiffs allege that they are former
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shareholders of Midlands and seek to represent a class of all Midlands
shareholders involved in the merger of Midlands into Carolina First Bank,
asserting that the defendants committed fraud, constructive fraud, and breach of
fiduciary duty against the defendants by overstating earnings and thereby
adversely affecting the consideration received by the Midlands shareholders in
connection with the merger of Midlands into Carolina First Bank. The complaint
seeks compensatory damages of approximately $1.8 million, punitive damages in an
amount to be determined by a jury, and attorneys' fees and other costs.
GROWTH THROUGH ACQUISITIONS
The Company has experienced significant growth in assets as a result of
acquisitions. Moreover, the Company anticipates engaging in selected
acquisitions of financial institutions and branch locations in the future.
Growth through future acquisitions could be very significant. There are certain
risks associated with the Company's acquisition strategy that could adversely
impact net income. Such risks include, among others, incorrectly assessing the
asset quality of a particular institution being acquired, encountering greater
than anticipated costs of incorporating acquired businesses into the Company and
being unable to profitably deploy funds acquired in an acquisition. Furthermore,
there can be no assurance as to the extent that the Company can continue to grow
through acquisitions. In the past, the Company has engaged in acquisitions
accounted for by the purchase method of accounting. Acquisitions accounted for
by the purchase method of accounting typically increase intangible assets and
may lower the capital ratios of the entities involved. Consequently, in the
event that the Company engages in significant acquisitions accounted for by the
purchase method of accounting in the future, the Company may be required to
raise additional capital in order to maintain capital levels required by the
Federal Reserve. In the future, the Company may issue capital stock in
connection with additional acquisitions. Such acquisitions and related issuances
of stock may have a dilutive effect on earnings per share and ownership.
DEPENDENCE ON SENIOR MANAGEMENT
The Company is dependent upon the services of certain of the senior
executive officers of the Company and its subsidiaries. The loss of the services
of one or more of such individuals could have a material adverse effect on the
Company. No assurance can be given that replacements for any of these officers
could be employed if their services were no longer available. The Company
maintains key employee insurance on Mack I. Whittle, Jr., the Company's Chief
Executive Officer.
ANTITAKEOVER MEASURES
The Company has certain antitakeover measures in place. These include
(i) a Shareholders' Rights Plan which, among other things, provides for the
dilution of the Common Stock holdings of certain shareholders who acquire 20% or
more of the Common Stock and attempt to acquire the Company without the consent
of management, (ii) certain management contracts which provide for additional
management compensation in the event that executive officers who are a party
thereto are terminated after a change in control of the Company, and (iii)
various charter provisions providing for, among other things, a "staggered"
board of directors and supermajority voting requirements in connection with the
removal of directors without cause and certain business combinations involving
the Company. Any one or more of these measures may impede the takeover of the
Company without the approval of the Company's Board of Directors and may prevent
shareholders from taking part in a transaction in which they could realize a
premium over the current market price of the Common Stock. See "Description of
Capital Stock."
COMMERCIAL LENDING ACTIVITIES
Over the past several years, the Company has experienced significant
growth in commercial and commercial mortgage loans. These loans are generally
more risky than one-to-four family or consumer loans because they are unique in
character, generally larger in amount and dependent upon the borrower's ability
to
9
<PAGE>
generate cash to service the loan. There are certain risks inherent in
making all loans, including risks with respect to the period of time over which
loans may be repaid, risks resulting from uncertainties as to the future value
of collateral, risks resulting from changes in economic and industry conditions
and risks inherent in dealing with individual borrowers.
While the Company's nonperforming loans as a percentage of total loans
is below its peer group average, there is a risk that the quality of the
Company's loan portfolio could decline, particularly in connection with the
rapid loan growth that the Company has experienced over the past several years.
HOLDING COMPANY STRUCTURE
As a holding company, the Company is a legal entity separate and
distinct from its banking and non-banking subsidiaries. Accordingly, the right
of the Company, and thus the right of the Company's creditors and shareholders,
to participate in any distribution of the assets or earnings of any subsidiary
is necessarily subject to the prior claims of creditors of the Operating
Subsidiaries, except to the extent that claims of the Company in its capacity as
a creditor may be recognized. The principal source of the Company's revenues is
dividends from the Operating Subsidiaries.
LIMITATIONS ON DIVIDENDS
The Company generates cash to pay dividends primarily through dividends
paid to it by its Operating Subsidiaries. South Carolina's banking regulations
restrict the amount of dividends that may be paid from Carolina First Bank. All
dividends paid from Carolina First Bank are subject to prior approval by the
South Carolina Commissioner of Banking and are payable only from the undivided
profits of Carolina First Bank. At December 31, 1997, Carolina First Bank's
retained earnings were $40.2 million. However, the payment of any such dividends
would be subject to receipt of appropriate regulatory approvals.
REGULATION
The Company and the Operating Subsidiaries are extensively regulated
under federal and state law. To the extent that information contained herein
describes statutory or regulatory provisions, it is qualified in its entirety by
reference to the particular statutory and regulatory provisions. Any change in
applicable laws may have a material adverse effect on the business and prospects
of the Company. The operations of the Company may be materially adversely
affected by possible legislative and regulatory changes and by the monetary
policies of the United States.
10
<PAGE>
SELECTED HISTORICAL FINANCIAL INFORMATION
The following information should be read in conjunction with the
audited consolidated financial statements of the Company, and the notes thereto,
included or incorporated by reference in the Company's 1996 Annual Report on
Form 10-K and in conjunction with the unaudited consolidated financial
statements of the Company and notes thereto included in the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 1997, and Management's
Discussion and Analysis of Financial Condition and Results of Operations to the
extent included in each case therein, all of which are incorporated herein by
reference. The following information should also be read in conjunction with the
pro forma financial information reflecting the Company's acquisition of First
Southeast in November 1997. See "Pro Forma Selected Financial Information" and
"Incorporation of Certain Documents by Reference."
<TABLE>
<CAPTION>
Nine Months Ended
September 30, Years Ended December 31,
------------------------ -------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
-------- -------- ------ ------ ------ -------- -------
(Dollars in thousands, except per share data and footnotes)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA
Net interest income $ 48,265 $ 42,075 $ 57,070 $ 50,772 $ 43,260 $ 29,358 $ 20,749
Provision for loan losses 9,603 8,171 10,263 6,846 1,197 1,106 2,318
Noninterest income, excluding
securities transactions 12,769 15,818 20,368 16,557 8,151 6,085 3,483
Securities transactions 2,453 757 973 769 75 680 633
Noninterest income 15,222 16,575 21,341 17,326 8,226 6,765 4,116
Noninterest expenses(1) 38,278 39,148 51,675 46,882 51,839 27,294 18,897
Net income (loss)(1) 10,016 7,235 10,474 9,414 (1,740) 5,418 2,466
Dividends on preferred stock -- 48 63 2,752 2,433 1,930 625
Net income (loss) applicable
to common shareholders(1) 10,016 7,187 10,411 6,662 (4,173) 3,488 1,841
BALANCE SHEET DATA (Year End)
Total assets $1,762,674 $1,501,124 $1,574,204 $1,414,922 $1,204,350 $ 904,474 $ 616,288
Securities and temporary investments 273,354 256,101 271,396 187,029 137,091 190,683 100,221
Loans, net of unearned income 1,305,612 1,053,234 1,124,775 1,062,660 923,068 623,646 455,650
Allowance for loan losses 13,925 10,541 11,290 8,661 6,002 6,679 5,276
Nonperforming assets 4,921 3,853 5,880 4,868 4,722 5,366 5,631
Total earning assets 1,599,568 1,348,275 1,396,171 1,249,689 1,059,455 814,579 555,871
Total deposits 1,396,802 1,232,608 1,281,050 1,095,491 1,001,748 804,549 555,624
Borrowed funds 190,205 126,706 145,189 186,789 106,074 16,779 2,591
Long-term debt 29,489 26,412 26,442 26,347 1,162 1,274 1,492
Preferred stock -- 943 943 32,909 37,014 15,662 10,319
Shareholders' equity 124,501 101,361 104,964 94,967 86,482 70,415 51,288
PER SHARE DATA(1)(2)
Net income (loss)
per common share:
Primary 0.86 0.68 $ 0.97 $ 0.89 $(0.59) $ 0.63 $ 0.34
Fully diluted 0.86 0.64 0.92 0.84 (0.59) 0.63 0.34
Cash dividends declared 0.21 0.18 0.25 0.21 0.17 0.04 --
Book value per common share (period end) 10.25 8.97 9.26 7.61 6.61 7.70 7.27
Common shares outstanding:
Weighted average - primary 11,662,194 10,676,466 10,705,107 7,516,620 7,004,214 5,505,461 5,453,681
Weighted average - fully diluted 11,693,326 11,347,849 11,368,035 11,183,726 10,114,812 8,208,935 6,401,692
Period end 12,150,453 9,331,598 11,225,568 7,820,839 7,079,866 6,969,484 5,472,979
FINANCIAL RATIOS
Return on average assets 0.84% 0.62% 0.71% 0.74% (0.16)% 0.69% 0.44%
Return on average equity 12.17 9.33 10.56 10.43 (1.99) 8.27 5.22
Net interest margin 4.32 4.40 4.35 4.54 4.65 4.16 4.01
</TABLE>
- --------
(1) Includes fourth quarter 1994 restructuring charges of $12,214,000 (pre-tax)
(2) Adjusted for stock dividends and stock splits.
11
<PAGE>
CAPITALIZATION
The following table sets forth the capitalization of the Company at
September 30, 1997 (which includes the Lowcountry acquisition), as adjusted to
give effect pro forma to the consummation of the First Southeast acquisition and
as adjusted to give effect to the sale of 2,000,000 shares of Common Stock at a
price of $20.50 per share, net of underwriting discounts and estimated expenses
totaling $2 million, and the application of the proceeds therefrom.
<TABLE>
<CAPTION>
September 30, 1997
(Consolidated Balance Sheet)
(Unaudited)
(Dollars in thousands)
Pro Forma
Adjusted for
First Southeast
Pro Forma Adjusted Acquisition and
for First Southeast as Adjusted for
Actual Acquisition the Offering
------ ----------- ------------
<S> <C> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Deposits
Noninterest-bearing................................ $ 187,817 $ 196,579 $ 196,579
Interest-bearing................................... 1,202,985 1,485,077 1,485,077
---------- ----------- ------------
Total deposits............................ 1,396,802 1,681,656 1,681,656
Borrowed funds......................................... 194,237 219,237 219,237
Subordinated notes..................................... 25,457 25,457 25,457
Other liabilities...................................... 21,677 31,156 31,156
---------- ---------- -----------
Total liabilities.................................. 1,638,173 1,957,506 1,957,506
Shareholders' Equity
Common stock-par value $1 per share; authorized
100,000,000 shares..................................... 12,150 15,648 17,648
Surplus ............................................... 97,846 165,844 202,844
Retained earnings...................................... 16,989 16,239 16,239
Guarantee of Employee Stock Ownership Plan debt (3,489) (3,498) (3,489)
and nonvested restricted stock...................... 1,005 1,005 1,005
Unrealized gain on securities available ---------- ----------- ------------
for sale, net of tax................................ 124,501 195,247 234,247
---------- ----------- ------------
Total shareholders' equity............................. $1,762,674 $2,152,753 $ 2,191,753
=========== =========== ===========
</TABLE>
<PAGE>
THE SELLING SHAREHOLDERS
The Selling Shareholders are individuals and entities which purchased the
Shares from the Company in a related series of transactions which were
consummated on February 13, 1998. These transactions were not registered, but
rather were structured so as to comply with Regulation S promulgated pursuant to
the Securities Act of 1933.
The following table sets forth the names of the Selling Shareholders, the
number of shares of Common Stock held by each Selling Shareholder prior to the
Offering, the percentage of outstanding Common Stock constituted by such shares,
the amount being offered for their respective accounts, and the number of shares
of Common Stock and the percentage of the Common Stock to be owned by each
Selling Shareholder after completion of the Offering. The table assumes that all
shares offered in the Offering are sold. During the past three years, none of
the Selling Shareholders had any position, office or material relationship with
the Company. As of the date hereof, there were 17,676,141 shares of Common Stock
outstanding.
<TABLE>
<CAPTION>
Name of Shares Owned % of Class Shares Owned % of Class
Selling Shareholder (Pre-Offering) (Pre-Offering) Shares Offered (Post-Offering) (Post-Offering)
- ---------------------- ---------------- -------------- ---------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
J. O Hambro Investment
Management Main A/C 46,300 * 46,300 -0- ---
J. O. Hambro Investment
Management A/C IOM 300 27,000 * 7,200 19,800 ---
J.O. Hambro Investment
Management Charity A/C 7,700 * 7,700 -0- ---
J.O. Hambro Investment
Management A/C IOM 100 18,800 * 18,800 -0- ---
J.O. Hambro Capital Manage-
ment Limited Main A/C 16,000 * 16,000 -0- ---
J.O. Hambro Capital Manage-
ment Limited A/C IOM 2 75,500 * 74,500 1,000 ---
J.O. Hambro Capital Manage-
ment Limited A/C American
Opportunity Trust PLC 75,000 * 75,000 -0- ---
J.O. Hambro Capital Manage-
ment Limited A/C North
Atlantic Smaller Companies
Investment Trust PLC 200,000 1.1% 200,000 -0- ---
Bank of Bermuda
(Guernsey) Limited 75,000 * 75,000 -0- ---
Raphael Zorn Hemsley Limited 51,760 * 40,000 11,760 ---
Rathbone Investment Manage-
ment Ltd. A/C Client 33,200 * 10,000 23,200 ---
Rathbone Management
Company Jersey 20,000 * 20,000 -0- ---
13
<PAGE>
Morgan Grenfel International
Funds Management A/C
American Growth Trust 120,000 * 120,000 -0- ---
Guyerzeller Bank AG 18,000 * 15,000 3,000 ---
Darier Hentsch & Cie 305,835 1.7% 25,000 280,835 1.6%
Delafontaine A/C Swiss
Bank Corporation,
Luxembourg 15,000 * 15,000 -0- ---
Mirabaud TWH Asset
Management Limited
A/C Mirabaud 12,500 * 12,500 -0- ---
Mirabaud TWH Asset
Management A/C Client 7,500 * 7,500 -0- ---
Bance Brignone A/C
International Equity Fund 15,000 * 15,000 -0- ---
Banca del Gottardo 41,000 * 40,000 1,000 ---
Finter Bank - Zurich 62,000 * 50,000 12,000 ---
Beleggingsmaadsehappy
Beurshave at Kempen
& Co., Amsterdam 10,000 * 10,000 -0- ---
Smith & Williamson A/C Client 10,000 * 10,000 -0- ---
Bank Julius Baer 215,000 * 91,000 124,000 ---
Merck Finck 21,371 * 5,000 16,371 ---
Bank Sarasin, Zurich 10,000 * 5,000 5,000 ---
Threadneedle Asset Management
A/CAmerican Growth 26,500 * 26,500 -0- ---
Threadneedle Asset Management
A/CAmerican Select Growth 9,000 * 9,000 -0- ---
Threadneedle Asset Management
A/C TZAMSM 7,330 * 3,665 3,665 ---
J.O. Hambro Capital
Management Ltd. A/C IOM 1 9,500 * 9,500 -0- ---
Threadneedle Asset Management
A/C TGA 23 10,835 * 10,835 -0- ---
Trinkaus & Burkhardt 15,000 * 15,000 -0- ---
Victoria KAG 45,000 * 45,000 -0- ---
Guinness Flight Hambros
Asset Management A/C Client 12,250 * 8,000 4,250 --
14
<PAGE>
<S> <C> <C> <C> <C> <C>
Credit Suisse Fides 5,000 * 5,000 -0- ---
Swiss Reinsurance Company 100,000 * 100,000 -0- ---
Generale de Banque Paris
A/C Interselex, America 20,000 * 20,000 -0- ---
Societe Generale Inv.
Management A/C Client 3,000 * 3,000 -0- ---
Rasbank, Milan 15,000 * 15,000 -0- ---
Ruegg Bank, Zurich 17,800 * 10,000 7,800 ---
Albert E. Sharp & Co. 10,000 * 10,000 -0- ---
Equitable Life Assurance
Society 125,000 * 125,000 -0- ---
Qatar Insurance Company 2,000 * 2,000 -0- ---
Bank Sarasin & Cie, Basel 8,000 * 8,000 -0- ---
Berenberg Bank, Hamburg 5,000 * 5,000 -0- ---
M&G A/C American
Smaller Companies 33,000 * 33,000 -0- ---
M&G A/C American
Recovery Fund 87,000 * 87,000 -0- ---
Gartmore American Emerging
Companies Strategy Fund 68,750 * 68,750 -0- ---
Gartmore American
Emerging Growth Fund 31,250 * 31,250 -0- ---
Gartmore Wall St.Capital Fund 12,500 * 12,500 -0- ---
Gartmore Capital Strategy U.S.
Smaller Companies Fund 12,500 * 12,500 -0- ---
Thornhill International Trust 13,000 * 10,000 3,000 ---
Banca Nazionale Dell
Agricoltura 10,000 * 5,000 5,000 ---
PYX Company Ltd. 25,000 * 10,000 15,000 ---
Mediolanum Gestione Fondi
A/C America 2000 20,000 * 20,000 -0- ---
Mediolanum Gestione
Fondi A/C Rioi 24,000 * 24,000 -0- ---
Mediolanum Gestione
Fondi A/C Riaz 6,000 * 6,000 -0- ---
Al Mawarid Securities
15
<PAGE>
Co. SAOG 37,000 * 37,000 -0- ---
Mr. Ajit Hamlai 29,000 * 29,000 -0- ---
Mr. Ajit Khimji 24,000 * 24,000 -0- ---
Mr. Ali Redhar Darwish 24,000 * 24,000 -0- ---
Mr. Murtadha Ahmed Sultan 19,000 * 19,000 -0- ---
Mr. Mohammad Abdulla Wahab
Al Lawati 14,000 * 14,000 -0- ---
Shaikh Salim Mustahail
Al Mashani 14,000 * 14,000 -0- ---
Mr. Thamer Shanfari 14,000 * 14,000 -0- ---
Mr. Mohammad Ali Sultan 12,000 * 12,000 -0- ---
Wadi Al Numar Enterprises 12,000 * 12,000 -0- ---
Mr. Tawfiq Ahmed Sultan 12,000 * 12,000 -0- ---
Mr. Mohammad Gulam
Habib Al Fattah 4,800 * 4,800 -0- ---
Ahmed Suwaidan Al Balushi 4,200 * 4,200 -0- ---
W.J. Towell & Co. LLC 9,000 * 9,000 -0- ---
Mr. Aubyn Hill 9,000 * 9,000 -0- ---
</TABLE>
- -----------------------
* less than 1%
16
<PAGE>
FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS, INCLUDING THE INFORMATION INCORPORATED BY REFERENCE
HEREIN, CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF
SECTION 27A OF THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT. SUCH
FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF THE COMPANY'S MANAGEMENT
AS WELL AS ON ASSUMPTIONS MADE BY AND INFORMATION CURRENTLY AVAILABLE TO THE
COMPANY AT THE TIME SUCH STATEMENTS WERE MADE. WHEN USED IN THIS PROSPECTUS, THE
WORDS "ANTICIPATE," "BELIEVE," "ESTIMATE," "EXPECT," "INTEND" AND SIMILAR
EXPRESSIONS, AS THEY RELATE TO THE COMPANY, ARE INTENDED TO IDENTIFY SUCH
FORWARD-LOOKING STATEMENTS. ALTHOUGH THE COMPANY BELIEVES THESE STATEMENTS ARE
REASONABLE, PROSPECTIVE PURCHASERS SHOULD BE AWARE THAT ACTUAL RESULTS COULD
DIFFER MATERIALLY FROM THOSE PROJECTED BY SUCH FORWARD-LOOKING STATEMENTS AS A
RESULT OF THE RISK FACTORS SET FORTH ABOVE OR OTHER FACTORS. PROSPECTIVE
PURCHASERS SHOULD CONSIDER CAREFULLY THESE FACTORS, AS WELL AS THE OTHER
INFORMATION AND DATA INCLUDED IN THIS PROSPECTUS. THE COMPANY CAUTIONS THE
READER, HOWEVER, THAT THIS LIST OF FACTORS MAY NOT BE EXHAUSTIVE AND THAT THESE
OR OTHER FACTORS, MANY OF WHICH ARE OUTSIDE OF THE COMPANY'S CONTROL, COULD HAVE
A MATERIAL ADVERSE EFFECT ON THE COMPANY. FURTHERMORE, THE COMPANY MAY NOT
UPDATE OR REVISE THE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR
CIRCUMSTANCES AFTER THE DATE HEREOF OR TO REFLECT THE OCCURRENCE OF
UNANTICIPATED EVENTS. PROSPECTIVE PURCHASERS ARE CAUTIONED NOT TO PLACE UNDUE
RELIANCE ON ANY OF THE FORWARD-LOOKING STATEMENTS INCLUDED HEREIN. ALL
FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY OR PERSONS ACTING ON ITS
BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY STATEMENTS
SET FORTH ABOVE.
USE OF PROCEEDS
Carolina First Corporation will receive no proceeds from the sale of
the Shares.
PLAN OF DISTRIBUTION
The Shares may be sold from time to time directly by the Selling
Shareholders. Alternatively, the Selling Shareholders may from time to time
offer and sell the Shares through underwriters, brokers, dealers or agents.
Sales of the Shares by the Selling Shareholders may be effected from
time to time in one or more transactions on the Nasdaq National Market,
including ordinary broker's transactions, in privately-negotiated transactions
or through sales to one or more broker/dealers for resale of such Shares as
principals or a combination of any such methods of sale, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. Usual and customary or specifically negotiated
brokerage or underwriting fees, commissions or discounts may be paid by the
Selling Shareholders in connection with such sales.
The Company will not incur any brokerage, underwriting or similar
fees in connection with the sale of the Shares by the Selling Shareholders.
17
<PAGE>
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Wyche, Burgess, Freeman & Parham, P.A., Greenville, South Carolina.
As of December 31, 1997, members and attorneys of Wyche, Burgess, Freeman &
Parham, P.A. beneficially owned a total of approximately 18,500 shares of the
Common Stock.
EXPERTS
The consolidated financial statements of the Company as of December
31, 1996 and 1995, and for each of the years in the two-year period ended
December 31, 1996, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG Peat Marwick, LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
The consolidated financial statements of Carolina First
Corporation as of and for the year ended December 31, 1994, have been
incorporated by reference herein and in the registration statement in
reliance upon the report of Elliott, Davis & Company, L.L.P.,
independent certified public accountants, and upon the authority of said
firm as experts in accounting and auditing.
18
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14: OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
All fees incurred in connection with the sale of Shares offered hereby will
be borne by the Selling Shareholders. The expenses in connection with the sale
of the Shares, other than brokerage discounts and commissions, are estimated as
follows:
Securities and Exchange Commission registration fee..............$ 13,788
Legal fees and expenses.......................................... 5,000
Accounting fees and expenses..................................... 5,000
----------
TOTAL.......................................................$ 23,788
ITEM 15: INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Reference is made to Chapter 8, Article 5 of Title 33 of the 1976
Code of Laws of South Carolina, as amended, which provides for indemnification
of officers and directors of South Carolina corporations in certain instances in
connection with legal proceedings involving any such persons because of being or
having been an officer or director. Carolina First Corporation's Bylaws provide
that Carolina First Corporation shall indemnify any individual made a party to a
proceeding because he is or was a Director of Carolina First Corporation against
liability incurred in the proceeding to the fullest extent permitted by law, and
that the Corporation shall pay for or reimburse the reasonable expenses incurred
by a Director who is a party to a proceeding in advance of final disposition of
the proceeding to the fullest extent permitted by law. Carolina First
Corporation has entered into indemnification agreements with each of its
Directors, which make the above-referenced Bylaws provisions the basis of a
contract between Carolina First Corporation and each director.
Chapter 8, Article 5 of Title 33 of the 1976 Code of Laws of South
Carolina, as amended, also permits a corporation to purchase and maintain
insurance on behalf of a person who is or was an officer or director. Carolina
First Corporation maintains directors' and officers' liability insurance.
Reference is made to Chapter 2 of Title 33 of the 1976 Code of Laws
of South Carolina, as amended, respecting the limitation in a corporation's
articles of incorporation of the personal liability of a director for breach of
the director's fiduciary duty. Reference is made to Carolina First Corporation's
Articles of Amendment filed with the South Carolina Secretary of State on April
18, 1989 which state: "A director of the corporation shall not be personally
liable to the corporation or any of its shareholders for monetary damages for
breach of fiduciary duty as a director, provided that this provision shall not
be deemed to eliminate or limit the liability of a director (i) for any breach
of the director's duty of loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve gross negligence,
intentional misconduct, or a knowing violation of laws, (iii) imposed under
Section 33-8-330 of the South Carolina Business Corporation Act of 1988
(improper distribution to shareholder), or (iv) for any transaction from which
the director derived an improper personal benefit."
II-1
<PAGE>
ITEM 16: EXHIBITS
3.1 -- Articles of Incorporation: Incorporated by reference to Exhibit
3.1 of Carolina First Corporation's Registration Statement on Form
S-4, Commission File No. 33-57389.
3.2 -- Articles of Amendment dated June 1, 1997: Incorporated by
reference to Exhibit 3.2 of Carolina First Corporation's Registration
Statement on Form S-4, Commission File No. 333-32459.
3.3 -- Amended and Restated Bylaws of Carolina First Corporation, as
amended and restated as of December 18, 1996: Incorporated by
reference to Exhibit 3.1 of Carolina First Corporation's Current
Report on Form 8-K dated December 18, 1996, Commission File No.
0-15083.
4.1 -- Specimen Carolina First Corporation Common Stock certificate:
Incorporated by reference to Exhibit 4.1 of Carolina First
Corporation's Registration Statement on Form S-1, Commission
File No. 33-7470.
4.2 -- Articles of Incorporation: Included as Exhibits 3.1 and 3.2.
4.2 -- Bylaws: Included as Exhibit 3.3.
4.3 -- Carolina First Corporation Amended and Restated Common Stock
Dividend Reinvestment Plan: Incorporated by reference to the
Prospectus in Carolina First Corporation's Registration
Statement on Form S-3, Commission File No. 333-06975.
4.6 -- Amended and Restated Shareholder Rights Agreement: Incorporated by
reference to Exhibit 4.1 of Carolina First Corporation's Current
Report on Form 8-K dated December 18, 1996, Commission File No.
0-15083.
4.7 -- Indenture between Carolina First Corporation and First American
Trust Company, N.A., as Trustee: Incorporated by reference to Exhibit
4.11 of Carolina First Corporation's Registration Statement on Form
S-3, Commission File No. 22-58879.
5.1 -- Opinion of Wyche, Burgess, Freeman & Parham, P.A. regarding legality
of shares of Carolina First Corporation.
23.1 -- Consent of KPMG Peat Marwick LLP.
23.2 -- Consent of Wyche, Burgess, Freeman & Parham, P.A.: Contained in
Exhibit 5.1.
23.3 -- Consent of Elliott, Davis & Company, L.L.P.*
24.1 -- The Power of Attorney: Contained on the signature page of this
Registration Statement.
27.1 -- Financial Data Schedule
* To be filed with Amendment No. 1 to this Registration Statement.
ITEM 17: UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the
registration statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously
disclosed in the registration statement or any
material change in such information in the
registration statement.
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference
in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Greenville, State of South Carolina, on February 23,
1998.
CAROLINA FIRST CORPORATION
By: /s/ William S. Hummers III
--------------------------
William S. Hummers III
Executive Vice President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints William S. Hummers III and Mack I.
Whittle, Jr., and each of them, as true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution for him or her and in his or
her name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises, as fully to all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming all which said
attorneys-in-fact and agents or any of them, or their or his or her substitute
or substitutes, may lawfully do, or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and as of the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ William R. Timmons, Jr. Chairman of the Board February 23, 1998
- --- ------- -- -------- ---
William R. Timmons, Jr.
/s/ Mack I. Whittle, Jr. President, Chief Executive Officer February 23, 1998
- --- ---- -- -------- --- and Director (Principal Executive Officer)
Mack I. Whittle, Jr.
/s/ William S. Hummers III Executive Vice President, Director February 23, 1998
- --- ------- -- ------- --- (Principal Accounting and Financial Officer)
William S. Hummers III
/s/ M. Dexter Hagy Director February 23, 1998
- --- -- ------ ----
M. Dexter Hagy
/s/ Eugene E. Stone IV Director February 23, 1998
- --- ------ -- ----- --
Eugene E. Stone IV
/s/ H. Earle Russell, Jr. Director February 23, 1998
- --- -- ----- -------- ---
H. Earle Russell, Jr.
/s/ Judd B. Farr Director February 23, 1998
- --- ---- -- ----
Judd B. Farr
/s/ Charles B. Schooler Director February 23, 1998
- --- ------- -- --------
II-4
<PAGE>
Charles B. Schooler
/s/ Elizabeth P. Stall Director February 23, 1998
- --- --------- -- -----
Elizabeth P. Stall
/s/ David C. Wakefield III Director February 23, 1998
- --- ----- -- --------- ---
David C. Wakefield III
/s/ William R. Phillips Director February 23, 1998
- --- ------- -- --------
William R. Phillips
/s/ Vernon E. Merchant, Jr. Director February 23, 1998
- --- ------ -- --------- ---
Vernon E. Merchant, Jr.
/s/ C. Claymon Grimes Director February 23, 1998
- --- -- ------- ------
C. Claymon Grimes
II-5
</TABLE>
<PAGE>
EXHIBITS
3.1 -- Articles of Incorporation: Incorporated by reference to Exhibit 3.1
of Carolina First Corporation's Registration Statement on Form S-4,
Commission File No. 33-57389.
3.2 -- Articles of Amendment dated June 1, 1997: Incorporated by reference
to Exhibit 3.2 of Carolina First Corporation's Registration Statement
on Form S-4, Commission File No. 333-32459.
3.3 -- Amended and Restated Bylaws of Carolina First Corporation, as
amended and restated as of December 18, 1996: Incorporated by reference
to Exhibit 3.1 of Carolina First Corporation's Current Report on Form
8-K dated December 18, 1996, Commission File No. 0-15083.
4.1 -- Specimen Carolina First Corporation Common Stock certificate:
Incorporated by reference to Exhibit 4.1 of Carolina First
Corporation's Registration Statement on Form S-1, Commission File
No. 33-7470.
4.2 -- Articles of Incorporation: Included as Exhibits 3.1 and 3.2.
4.2 -- Bylaws: Included as Exhibit 3.3.
4.3 -- Carolina First Corporation Amended and Restated Common Stock Dividend
Reinvestment Plan: Incorporated by reference to the Prospectus
in Carolina First Corporation's Registration Statement on Form
S-3, Commission File No. 333-06975.
4.6 -- Amended and Restated Shareholder Rights Agreement: Incorporated by
reference to Exhibit 4.1 of Carolina First Corporation's Current Report
on Form 8-K dated December 18, 1996, Commission File No. 0-15083.
4.7 -- Indenture between Carolina First Corporation and First American
Trust Company, N.A., as Trustee: Incorporated by reference to Exhibit
4.11 of Carolina First Corporation's Registration Statement on Form
S-3, Commission File No. 22-58879.
5.1 -- Opinion of Wyche, Burgess, Freeman & Parham, P.A. regarding legality
of shares of Carolina First Corporation.
23.1 -- Consent of KPMG Peat Marwick LLP.
23.2 -- Consent of Wyche, Burgess, Freeman & Parham, P.A.: Contained in
Exhibit 5.1.
23.3 -- Consent of Elliott, Davis & Company, L.L.P.*
24.1 -- The Power of Attorney: Contained on the signature page of this
Registration Statement.
27.1 -- Financial Data Schedule
* To be filed with Amendment No. 1 to this Registration Statement.
II-6
<PAGE>
EXHIBIT 5.1
[Wyche, Burgess, Freeman & Parham Letterhead]
OPINION REGARDING LEGALITY
February 23, 1998
Carolina First Corporation
102 South Main Street
Greenville, South Carolina 29601
RE: Registration Statement on Form S-3 with respect to 2,000,000
Shares of Carolina First Corporation Common Stock
Gentlemen/Ladies:
The opinions set forth herein are rendered with respect to the
2,000,000 shares (the "Shares"), $1 par value per share, of the Common Stock
(the "Common Stock") of Carolina First Corporation, a South Carolina corporation
(the "Company"), which are expected to be sold by the selling shareholders (the
"Selling Shareholders") set forth in the Regisration Statement referenced below.
The sale of the Shares is being registered with the Securities and Exchange
Commission by the Company's Registration Statement on Form S-3 (the
"Registration Statement") filed on or about February 23, 1998, pursuant to the
Securities Act of 1933, as amended.
We have examined the Company's Articles of Incorporation, as amended,
and the Company's Bylaws, as amended, and reviewed the records of the Company's
corporate proceedings. We have made such investigation of law as we have deemed
necessary in order to enable us to render this opinion. With respect to matters
of fact, we have relied upon information provided to us by the Company and no
further investigation. With respect to all examined documents, we have assumed
the genuineness of all signatures, the authenticity of all documents submitted
to us as originals, the conformity to authentic originals of all documents
submitted to us as certified, conformed or photostatic copies and the accuracy
and completeness of the information contained therein.
Based on and subject to the foregoing and subject to the comments,
limitations and qualifications set forth below, we are of the opinion that the
Shares to be sold pursuant to the Registration Statement will, when sold by the
Selling Shareholders, be legally and validly issued and fully paid and
non-assessable.
The foregoing opinion is limited to matters governed by the laws of the
State of South Carolina in force on the date of this letter. We express no
opinion with regard to any matter which may be (or purports to be) governed by
the laws of any other state or jurisdiction. In addition, we express no opinion
with respect to any matter arising under or governed by the South Carolina
Uniform Securities Act, as amended, any law respecting disclosure, or any law
respecting any environmental matter.
II-7
<PAGE>
This opinion is rendered as of the date of this letter and applies only
to the matters specifically covered by this opinion, and we disclaim any
continuing responsibility for matters occurring after the date of this letter.
Except as noted below, this opinion is rendered solely for your benefit
in connection with the Registration Statement and may not be relied upon, quoted
or used by any other person or entity or for any other purpose without our prior
written consent.
We consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the heading "Legal Matters" in
the Registration Statement.
/s/ WYCHE, BURGESS, FREEMAN & PARHAM, P.A.
WYCHE, BURGESS, FREEMAN & PARHAM, P.A.
II-8
EXHIBIT 23.1
[Firm Letterhead]
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Carolina First Corporation
We consent to the use of our report dated January 21, 1997 included in Carolina
First Corporation's Form 10-K for the year ended December 31, 1996, incorporated
herein by reference and to the reference to our firm under the heading "Experts"
in the prospectus contained in such Registration Statement.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Greenville, South Carolina
February 23, 1998
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C> <C>
<PERIOD-TYPE> 3-MOS YEAR
<FISCAL-YEAR-END> OCT-01-1997 DEC-31-1997
<PERIOD-END> DEC-31-1997 DEC-31-1997
<CASH> 73,326 73,326
<INT-BEARING-DEPOSITS> 34,703 34,703
<FED-FUNDS-SOLD> 0 0
<TRADING-ASSETS> 2,349 2,349
<INVESTMENTS-HELD-FOR-SALE> 262,329 262,329
<INVESTMENTS-CARRYING> 33,855 33,855
<INVESTMENTS-MARKET> 34,494 34,494
<LOANS> 1,602,415 1,602,415
<ALLOWANCE> 16,211 16,211
<TOTAL-ASSETS> 2,156,346 2,156,346
<DEPOSITS> 1,746,542 1,746,542
<SHORT-TERM> 139,739 139,739
<LIABILITIES-OTHER> 29,287 29,287
<LONG-TERM> 39,119 39,119
0 0
0 0
<COMMON> 15,659 15,659
<OTHER-SE> 186,000 186,000
<TOTAL-LIABILITIES-AND-EQUITY> 2,156,346 2,156,346
<INTEREST-LOAN> 34,060 120,385
<INTEREST-INVEST> 4,046 14,270
<INTEREST-OTHER> 339 1,051
<INTEREST-TOTAL> 38,445 135,706
<INTEREST-DEPOSIT> 16,844 56,920
<INTEREST-EXPENSE> 20,004 69,000
<INTEREST-INCOME-NET> 18,441 66,706
<LOAN-LOSSES> 2,043 11,646
<SECURITIES-GAINS> 558 3,011
<EXPENSE-OTHER> 13,965 52,243
<INCOME-PRETAX> 6,826 22,432
<INCOME-PRE-EXTRAORDINARY> 4,324 14,340
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 4,324 14,340
<EPS-PRIMARY> 0.32 1.19<F1>
<EPS-DILUTED> 0.32 1.18
<YIELD-ACTUAL> 9.34 9.36
<LOANS-NON> 1,165 1,165
<LOANS-PAST> 4,125 4,125
<LOANS-TROUBLED> 1,283 1,283
<LOANS-PROBLEM> 0 0
<ALLOWANCE-OPEN> 13,925 11,290
<CHARGE-OFFS> 2,913 12,119
<RECOVERIES> 191 1,186
<ALLOWANCE-CLOSE> 16,211 16,211
<ALLOWANCE-DOMESTIC> 16,211 16,211
<ALLOWANCE-FOREIGN> 0 0
<ALLOWANCE-UNALLOCATED> 0 0
<FN>
<F1>EPS-BASIC
</FN>
</TABLE>
