As filed with the Securities and Exchange Commission on June 16, 1997
Registration No. [______]
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
------------------
Quad City Holdings, Inc.
(Exact name of registrant as specified in its charter)
Delaware 42-1397595
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification Number)
-----------------
2118 Middle Road
Bettendorf, Iowa 52722
(319) 344-0600
(Address and telephone number of principal executive offices)
------------------
2118 Middle Road
Bettendorf, Iowa 52722
(Address of principal place of business or intended
principal place of business)
Douglas M. Hultquist
President
Quad City Holdings, Inc.
2118 Middle Road, P.O. Box 395
Bettendorf, Iowa 52722
(319) 344-0600
(Name, address and telephone number of agent for service)
With copies to:
John E. Freechack, Esq.
Barack Ferrazzano Kirschbaum Perlman & Nagelberg
333 West Wacker Drive, Suite 2700
Chicago, Illinois 60606
(312) 984-3100
Approximate date of proposed sale to the public: As soon as practicable after
the effective date of this Registration Statement.
If the only 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.
CALCULATION OF REGISTRATION FEE
<TABLE>
Proposed Maximum Proposed Maximum
Title of Each Class Amount to be Offering Price Aggregate Amount of
of Securities to be Registered Registered per Share (1) Offering Price (1) Registration Fee(1)
- -------------------------------- ------------- ----------------- ------------------ -------------------
<S> <C> <C> <C> <C>
Common Stock, $1.00 Par Value 25,000 shares $20.25 $506,250 $154.00
<FN>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) promulgated under the Securities Act of 1933, as
amended (the "Securities Act"), and based on the average of the high and
low sales prices as reported on the Nasdaq SmallCap Market for June 12,
1997.
</FN>
</TABLE>
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 which 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>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
SUBJECT TO COMPLETION, DATED JUNE 16, 1997
25,000 Shares
QUAD CITY HOLDINGS, INC.
Common Stock
This Prospectus relates to 25,000 shares of common stock, $1.00 par value per
share ("Common Stock"), of Quad City Holdings, Inc. (the "Company") issued to
Dain Bosworth Incorporated ("Dain Bosworth") in connection with the exercise by
Dain Bosworth of a certain warrant issued to it in connection with the Company's
initial public offering (the "Offered Securities").
The Offered Securities may be offered from time to time by the "Selling
Stockholders" identified herein or their pledges, donees, transferees or other
successors in interest. See "Selling Stockholders." The Selling Stockholders
have advised the Company that sales of the Offered Securities may be made, if at
all, from time to time after the effective date of the Registration Statement of
which this Prospectus is a part in the over-the-counter market through licensed
broker-dealers or otherwise, at the then prevailing market prices, or otherwise
at prices and on terms then obtainable through privately negotiated
transactions. No period of time has been fixed within which the Offered
Securities covered by this Prospectus may be offered or sold. See "Plan of
Distribution."
The Company will receive no part of the proceeds of any sales of the Offered
Securities except for the exercise price of the warrant. The Company will pay
all expenses with respect to this Offering, except for underwriting discounts,
brokerage fees and commissions and transfer taxes (if any) for the Selling
Stockholders, which will be borne by the Selling Stockholders.
The Company's Common Stock is traded in the over-the-counter market and prices
are quoted by the Nasdaq SmallCap Market under the symbol "QCHI." On June 11,
1997, the last reported sale price of the Common Stock, as reported by the
Nasdaq SmallCap Market, was $20.25.
No person has been authorized to give any information or to make any
representations not contained or incorporated by reference in this Prospectus in
connection with the Offered Securities and, if given or made, such information
and representations must not be relied upon as having been authorized by the
Company or the Selling Stockholders. Neither the delivery of this Prospectus nor
any sale made under this Prospectus shall under any circumstances create any
implication that there has been no change in the affairs of the Company since
the date hereof or since the date of any documents incorporated herein by
reference. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any securities other than the securities to
which it relates, or an offer or solicitation in any state to any person to whom
it is unlawful to make such offer in such state.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMIS- SION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is June 16, 1997.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended ("the "Exchange Act"), and in accordance
therewith files reports, proxy and information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information concerning the Company can be inspected
and copied at the public reference facilities of the Commission at 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549, as well as the Commission's
Regional Offices at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661
and 75 Park Place, Room 1400, New York, New York 10007. Copies of such material
can be obtained at prescribed rates from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition, the
Company is required to file electronic versions of these documents with the
Commission through the Commission's Electronic Data Gathering, Analysis and
Retrieval (EDGAR) system. The Commission maintains a World Wide Web site at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission.
The Company has filed with the Commission a Registration Statement on Form S-3
under the Securities Act and the rules and regulations promulgated thereunder,
with respect to the Common Stock offered pursuant to this Prospectus. This
Prospectus, which is part of the Registration Statement, does not contain all of
the information, exhibits and undertakings set forth in the Registration
Statement, certain portions of which are omitted as permitted by the Rules and
Regulations of the Commission. For further information concerning the Company
and the Common Stock offered hereby, reference is made to the Registration
Statement and the exhibits filed therewith, which may be examined without charge
at, or copies obtained upon payment of prescribed fees from, the Commission and
its regional offices at the locations listed above. Any statements contained
herein concerning the provisions of any document are not necessarily complete,
and, in each instance, reference is made to the copy of such document filed as
an exhibit to the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in its entirety by such reference.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed with the Commission are incorporated by reference
in this Prospectus:
(1) the Company's Annual Report on Form 10-KSB for the year ended June 30,
1996, filed by the Company with the Commission on September 27, 1996 (File
No. 0-22208);
(2) all other reports filed pursuant to Section 13(a) of the Exchange Act since
the end of the fiscal year covered by the Annual Report referred to in (1)
above.
(3) the description of the Company's Common Stock contained in its Registration
Statement on Form 8-A (File No. 0-22208), and all amendments filed for the
purpose of updating such description.
All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of this Offering shall be deemed to be incorporated
by reference in this Prospectus and to be a part hereof from the date of filing
of such documents (such documents, and the documents enumerated above, are
hereinafter referred to as "Incorporated Documents"). Any statement contained in
an Incorporated Document shall be deemed to be modified or superseded for
purposes of this Prospectus and the Registration Statement of which it is a part
to the extent that a statement contained herein or in any other subsequently
filed Incorporated Document or in an accompanying prospectus supplement modifies
or supersedes such statement. Any such statement so modified or superseded
should not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus or the Registration Statement.
<PAGE>
RISK FACTORS
A purchase of the Company's Common Stock involves significant risk. In addition
to the other information in this Prospectus, the following risk factors should
be considered carefully by prospective investors.
Dependence on Management
The Company and its subsidiaries, Quad City Bank & Trust Company (the "Bank")
and Quad City Bancard, Inc. ("Bancard," and collectively with the Bank, the
"Subsidiaries"), are, and for the foreseeable future will be, dependent on the
services of Michael A. Bauer, the Company's Chairman of the Board, and Douglas
M. Hultquist, the Company's President, Chief Financial Officer and Treasurer,
and other senior managers of the Company and the Subsidiaries. The Company has
entered into three-year employment agreements (which include certain
non-competition covenants) with each of Messrs. Bauer and Hultquist in an effort
to assure the continued availability of their services to the Company. Because
Mr. Bauer is primarily responsible for the Bank's operations, the loss of Mr.
Bauer's services could have a material adverse effect on the operations of the
Company and the Bank.
Competition
The Company and the Bank face strong competition for deposits, loans and other
financial services from numerous Iowa and out-of-state banks, thrifts, credit
unions and other financial institutions as well as other entities which provide
financial services. Many of these financial institutions aggressively compete
for business in the Bank's market area. Most of these competitors have been in
business for many years, have established customer bases, are substantially
larger, have substantially higher lending limits than the Bank and are able to
offer certain services, including international banking services, that the Bank
can offer only through correspondents, if at all. In addition, most of these
entities have greater capital resources than the Bank, which, among other
things, allow them to price certain services at levels more favorable to the
customer and to provide larger credit facilities than can the Bank. Government
Regulation
The Company and the Bank are subject to extensive federal and state legislation,
regulation and supervision, including by the Board of Governors of the Federal
Reserve System (the "Federal Reserve Board"), the Federal Deposit Insurance
Corporation (the "FDIC") and the Iowa Superintendent of Banking (the "Iowa
Superintendent"). Changes in legislation and regulations will continue to have a
significant impact on the banking industry. Although some of the legislative and
regulatory changes may benefit the Company and the Bank, others will increase
their costs of doing business and assist competitors of the Company and the
Bank.
Impact of Interest Rates and Economic Conditions
The results of operations for financial institutions, including the Company and
the Bank, may be materially and adversely affected by changes in prevailing
economic conditions, including declines in real estate market values, rapid
changes in interest rates and the monetary and fiscal policies of the federal
government. The Bank has a significant concentration of loans to individuals and
businesses in the Quad Cities metropolitan area and any decline in the economy
of such area would likely have an adverse impact on the Company and the Bank.
Dividends
The Company expects that all earnings of the Company and the Subsidiaries will
be retained to finance growth and that no cash dividends will be paid for the
foreseeable future. If and when dividends are declared, the Company will
probably be largely dependent upon dividends paid by the Subsidiaries for funds
to pay dividends on the Common Stock. The Company does not anticipate paying
dividends on the Common Stock in the foreseeable future.
Lending Risks and Lending Limits
The risk of nonpayment of loans is inherent in commercial banking, and such
nonpayment, if it occurs, may have a material adverse effect on the Company's
earnings and overall financial condition as well as the value of the Common
Stock. Moreover, the Company's focus on small to medium-sized businesses results
in a larger concentration by the Company of loans to such businesses. As a
result, the Company may assume greater lending risks than banks which have a
lesser concentration of such loans and tend to make loans to larger companies.
Management attempts to minimize the Company's credit exposure by carefully
monitoring the concentration of its loans within specific industries and through
prudent loan application and approval procedures, but there can be no assurance
that such monitoring and procedures will reduce such lending risks.
<PAGE>
Anti-Takeover Provisions
The Company's certificate of incorporation (the "Certificate") and bylaws (the
"Bylaws") include provisions which may have the effect of delaying, deferring or
preventing certain types of transactions involving an actual or potential change
in control of the Company, including transactions in which the Company's
stockholders might otherwise receive a premium for their shares over then
current market prices, and may limit the ability of the stockholders to approve
transactions that they may deem to be in their best interests. Section 203 of
the Delaware General Corporation Law ("DGCL") prohibits the Company from
engaging in certain business combinations with interested stockholders, and
federal law also requires the approval of the Federal Reserve Board prior to
acquisition of "control" of a bank holding company. These provisions may have
the effect of delaying or preventing a change in control of the Company without
action by the stockholders, and therefore could adversely affect the price of
the Common Stock. The Company's Certificate and Bylaws provide for the
indemnification of its officers and directors and insulate its officers and
directors from liability for breaches of the duty of care. See "Description of
Capital Stock--Certain Anti-Takeover, Indemnification and Limited Liability
Provisions."
Limited Trading Market
The Common Stock is currently quoted on the Nasdaq SmallCap Market. However,
there generally has been no substantial trading volume in the Common Stock, and
there can be no assurance that a substantial trading market will develop and
continue after this Offering or that the market price of the Common Stock will
not decline below its current price.
THE COMPANY
The Company was formed in February of 1993 under the laws of the state of
Delaware for the purpose of becoming the bank holding company of the Bank.
The Bank was capitalized on October 13, 1993, and commenced operations on
January 7, 1994. The Bank is organized as an Iowa-chartered commercial bank that
is a member of the Federal Reserve System with depository accounts insured by
the FDIC. The Bank provides full-service commercial and consumer banking
services in Bettendorf and Davenport, Iowa and adjacent communities. Bancard was
formed on April 3, 1995, as a Delaware corporation, and provides merchant credit
card processing services. This operation had previously been a division of the
Bank since July 1994. Bancard has contracted with an independent sales
organization which markets credit card services to merchants throughout the
country. Currently, approximately 8,500 merchants process transactions with
Bancard.
The Company is also in the process of forming an Illinois bank subsidiary, to be
known as "Quad City Bank & Trust Company - Illinois" (the "Illinois Bank"),
which will be headquartered in Moline, Illinois. The Company anticipates that
immediately following the issuance of a charter to the Illinois Bank, the
Illinois Bank will be merged into the Bank, and the office of the Illinois Bank
in Moline, Illinois, will become a branch office of the Bank. The organization
of the Illinois Bank and the merger of the Illinois Bank into the Bank are
expected to be completed in June, 1997.
The Company owns 100% of the Bank, Bancard and the Illinois Bank, and in
addition to such ownership invests its capital in stocks of financial
institutions and mutual funds, as well as participates in loans with the Bank.
The Bank competes with other commercial banks, savings banks, savings and loan
institutions, credit unions and other financial service organizations in the
Quad Cities market. The Bank, the Illinois Bank, the Company and Bancard are
regulated by the Federal Reserve Board. In addition, the Bank is regulated by
the Iowa Superintendent and the FDIC and, until merged into the Bank, the
Illinois Bank is regulated by the Illinois Commissioner of the Office of Banks
and Real Estate.
The Company's principal business consists of attracting deposits from the public
and investing those deposits in loans and securities. The Bank's deposits are
insured to the maximum allowable by the FDIC. The Company's results of
operations are dependent primarily on net interest income, which is the
difference between the interest earned on its loans and securities and the
interest paid on deposits. The Company's operating results are affected by
merchant credit card fees, trust fees, deposit service charges and other income.
Operating expenses of the Company include employee compensation and benefits,
occupancy and equipment expense, professional and data processing fees,
advertising and marketing expenses and other administrative expenses. The
Company's operating results are also affected by economic and competitive
conditions, particularly changes in interest rates, government policies and
actions of regulatory authorities. The commercial banking business is a highly
regulated business.
<PAGE>
The Company, the Bank and Bancard have a June 30th fiscal year end and employ
approximately 80 individuals. No one customer accounts for more than 10% of
revenues, loans or deposits.
USE OF PROCEEDS
The Company will receive no part of the proceeds of any sales of the Offered
Securities, except with respect to the exercise price of the warrant.
SELLING STOCKHOLDERS
The Company issued the Offered Securities to Dain Bosworth as a result of the
exercise by Dain Bosworth of a warrant that was issued to it by the Company on
October 13, 1993, as partial consideration for its services as underwriter for
the Company's initial public offering in October, 1993. This warrant had an
exercise price of $12.00 per share, while the offering price to the public of
the Common Stock in the Company's initial public offering was $10.00 per share.
The warrant issued to Dain Bosworth would have expired if not exercised by
October 13, 1998. Dain Bosworth is currently the record owner of only the
Offered Securities.
PLAN OF DISTRIBUTION
Offered Securities may be sold from time to time by the Selling Stockholders or
by pledges, donees, transferees or other successors in interest in one or more
transactions at a fixed offering price, at varying prices determined at the time
of sale or at negotiated prices. Such sales may be made to purchasers directly
by the Selling Stockholders (or their pledgees, donees, transferees or other
successors in interest) or, alternatively, the Selling Stockholders (or their
pledgees, donees, transferees or other successors in interest) may offer the
Offered Securities, pursuant to either this Registration Statement or Rule 144
of the Securities Act, through underwriters, dealers, brokers or agents, who may
receive compensation in the form of underwriting discounts, concessions or
commissions from the Selling Stockholders (or their pledgees, donees,
transferees or other successors in interest) and/or the purchasers of the
Offered Securities for whom they may act as agents. In effecting sales of
Offered Securities, brokers or dealers may arrange for other brokers or dealers
to participate. Such brokers or dealers and any other participating brokers or
dealers may be deemed to be underwriters within the meaning of the Securities
Act in connection with such sales. Sales of Common Stock may be made through the
Nasdaq SmallCap Market or otherwise at prices and at terms then prevailing or in
negotiated transactions.
The Company has agreed to indemnify the Selling Stockholders against certain
liabilities in connection with the distribution of the Offered Securities,
including liabilities under the Securities Act. Under agreements that may be
entered into by the Selling Stockholders, brokers or dealers who participate in
the distribution of the Offered Securities may be entitled to indemnification by
the Selling Stockholders and the Company against certain liabilities, including
liabilities under the Securities Act.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company presently consists of 2,500,000
shares of Common Stock, par value $1.00 per share, and 250,000 shares of
preferred stock, par value $1.00 per share, issuable in series (the "Preferred
Stock"). One series of preferred stock, known as Series A Preferred Stock and
consisting of 100 shares, has been authorized (the "Series A Preferred Stock").
Common Stock
As of the date of this Prospectus, there were 1,437,824 shares of Common Stock
issued and outstanding, which shares are held by approximately 2,000 holders of
record. All outstanding shares of Common Stock are, and the shares offered
hereby will be, fully paid and nonassessable. The holders of Common Stock are
entitled to one vote for each share held of record on all matters voted upon by
the Company's stockholders and may not cumulate votes for the election of
directors. Thus, the owners of a majority of the shares of Common Stock
outstanding may elect all of the directors, if they choose to do so, and the
owners of the balance of such shares would not be able to elect any directors.
Subject to preferences that may be applicable to any outstanding shares of
Preferred Stock, each share of outstanding Common Stock is entitled to
participate equally in any distribution of net assets made to the stockholders
in liquidation, dissolution or winding up the Company and is entitled to
participate equally in dividends as and when declared by the Company's Board of
Directors. There are no redemption, sinking fund, conversion or preemptive
rights with respect to the shares of Common Stock. All shares of Common Stock
have equal rights and preferences. The transfer agent and registrar for the
Common Stock is Harris Trust and Savings Bank, Chicago, Illinois.
<PAGE>
Preferred Stock
As of the date of this Prospectus, there were 10 shares of Series A Preferred
Stock issued and outstanding. The Series A Preferred Stock does not carry any
stated dividend rate. The Series A Preferred Stock is redeemable at the
Company's option at any time after the first anniversary of the issuance of any
shares of Series A Preferred Stock, and is subject to mandatory pro rata
redemption if the Company sells for cash additional shares of Common Stock,
subject to receipt in either case of all required regulatory approvals and
certain additional conditions. The holders of Series A Preferred Stock are not
entitled to vote on any matter except as required by law or to approve the
authorization or issuance of any shares of any class or series of stock which
ranks senior or on a parity with the Series A Preferred Stock in respect of
dividends and distributions upon the dissolution, liquidation or winding up of
the Company. The Company may, but is not currently obligated to, issue
additional shares of Series A Preferred Stock in the future.
The Board of Directors is authorized to fix or alter the rights, preferences,
privileges and restrictions of any wholly unissued series of Preferred Stock,
including the dividend rights, original issue price, conversion rights, voting
rights, terms of redemption, liquidation preferences and sinking fund, and the
number of shares constituting any such series and the designation thereof and to
increase or decrease the number of shares of such series subsequent to the
issuance of shares of such series (but not below the number of shares then
outstanding). Because the terms of the Preferred Stock can be fixed by the Board
of Directors without stockholder action, the Preferred Stock could be issued
with terms calculated to defeat a proposed takeover of the Company or to make
the removal of management more difficult. The Board of Directors, without
stockholder approval, could issue Preferred Stock with dividend, voting and
conversion rights which could adversely affect the rights of the holders of
Common Stock.
Certain Anti-Takeover, Indemnification and Limited Liability Provisions
The Certificate contains certain provisions which may have an effect of
delaying, deferring or preventing a change in control of the Company. Such
provisions could also result in the Company being less attractive to a potential
acquiror. The Certificate provides that the Board of Directors shall consist of
three classes of directors, each serving for a three-year term ending in a
successive year. This provision may make it more difficult to effect a takeover
of the Company because it would generally take two annual meetings of
stockholders for an acquiring party to elect a majority of the Board of
Directors. As a result, a classified Board of Directors may discourage proxy
contests for the election of directors or purchases of a substantial block of
stock because it could operate to prevent obtaining control of the Board of
Directors in a relatively short period of time.
The Certificate also requires the affirmative vote of 75% of the outstanding
shares of voting stock to approve certain fundamental changes such as mergers,
consolidations or dissolutions of the Company or the sale or lease of all or
substantially all of the Company's assets, unless such changes have received
advance approval of 80% of the Company's directors, in which case the required
vote is a majority.
In addition, the Certificate provides that the stockholders may only take action
at a duly called and held meeting and may not take action by written consent,
unless the action has received advance approval of 80% of the Company's
directors. This provision may make it more difficult to effect a takeover of the
Company by means of certain transactions, such as a merger or sale of assets, by
requiring a potential acquiror to hold a stockholders' meeting before such a
transaction could be consummated.
The Certificate also provides that the provisions of the Certificate governing
amendment of the Certificate and the Bylaws, establishing the Company's
classified board of directors, establishing additional voting requirements,
restricting certain business combinations with interested stockholders and
requiring stockholder actions to be taken only at meetings, may be amended only
by the affirmative vote of not less than 75% of the outstanding shares of voting
stock of the Company, unless such changes have received advance approval of at
least 80% of the Company's directors, in which case the required vote is a
majority.
<PAGE>
The Company is subject to the provisions of Section 203 of the DGCL. In general,
this statute prohibits a publicly held Delaware corporation from engaging in a
"business combination" with an "interested stockholder" for a period of three
years after the date the person or entity becomes an interested stockholder,
unless (with certain exceptions) the business combination or the transaction in
which the person becomes an interested stockholder is approved in a prescribed
manner. Generally, a "business combination" includes a merger, asset or stock
sale or other transaction resulting in a financial benefit to the stockholder.
An "interested stockholder" is generally defined as a person who, together with
affiliates and associates, owns (or, within the three prior years, did own) 15%
or more of the corporation's voting stock. This provision may have the effect of
delaying, deferring or preventing a change in control of the Company without
further action by the stockholders.
As permitted by the provisions of the DGCL, the Certificate eliminates in
certain circumstances the monetary liability of directors of the Company for a
breach of their fiduciary duty as directors. These provisions do not eliminate
the liability of a director for: (i) a breach of the director's duty of loyalty
to the Company or its stockholders; (ii) acts or omissions by a director not in
good faith or which involve intentional misconduct or a knowing violation of
law; (iii) liability arising under Section 174 of the DGCL (relating to the
declaration of dividends and purchase or redemption of shares in violation of
the DGCL;) or (iv) any transaction from which the director derived an improper
personal benefit. In addition, these provisions do not limit the rights of the
Company or its stockholders, in appropriate circumstances, to seek equitable
remedies such as injunctive or other forms of non-monetary relief. Such remedies
may not be effective in all cases.
The Certificate and Bylaws provide that the Company shall indemnify all
directors and officers of the Company to the full extent permitted by the DGCL.
Under such provisions, any director or officer, who in his or her capacity as
such, is made or threatened to be made, a party to any suit or proceeding, shall
be indemnified if such director or officer acted in good faith and in a manner
he or she reasonably believed to be in or not opposed to the best interests to
the Company. The Certificate, Bylaws, and the DGCL further provide that such
indemnification is not exclusive of any other rights to which such individuals
may be entitled under the Certificate, the Bylaws, any agreement, insurance
policies, vote of stockholders or disinterested directors or otherwise.
LEGAL OPINIONS
The legality of the shares of Common Stock being offered hereby will be passed
upon for the Company by Barack Ferrazzano Kirschbaum Perlman & Nagelberg, 333
West Wacker Drive, Suite 2700, Chicago, Illinois.
EXPERTS
The audited financial statements of the Company incorporated by reference into
this Prospectus have been audited by McGladrey & Pullen LLP, independent public
accountants, as indicated in their report with respect thereto. Such financial
statements have been included herein and in the Registration Statement in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said report.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth those expenses to be incurred in connection with
the issuance and distribution of the securities being registered.
Registration Fee..................................................$ 154
Legal Fees and Expenses...........................................$5,000
Accounting Fees and Expenses......................................$2,000
Miscellaneous.....................................................$ 500
------
Total.............................................................$7,654
======
All expenses are estimated except the Registration Fee.
Item 17. Indemnification of Directors and Officers.
In accordance with the DGCL (being Chapter 1 of Title 8 of the Delaware Code),
Articles IX and X of the Registrant's certificate of incorporation provide as
follows:
NINTH: Each person who is or was a director or officer of the corporation and
each person who serves or served at the request of the corporation as a
director, officer or partner of another enterprise, shall be indemnified by the
corporation in accordance with, and to the fullest extent authorized by, the
General Corporation Law of the State of Delaware, as the same now exists or may
be hereafter amended. No amendment to or repeal of this Article IX shall apply
to or have any effect on the rights of any individual referred to in this
Article IX for or with respect to acts or omissions of such individual occurring
prior to such amendment or repeal.
TENTH: To the fullest extent permitted by the General Corporation Law of
Delaware, as the same now exists or may be hereafter amended, a director of the
corporation shall not be liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director. No amendment to or
repeal of this Article X shall apply to or have any effect on the liability or
alleged liability of any director of the corporation for or with respect to any
acts or omissions of such director occurring prior to the effective date of such
amendment or repeal.
Article VII of the Registrant's bylaws further provides as follows:
Section 7.1 DIRECTORS AND OFFICERS. (a) The corporation shall indemnify any
person who was or is a party or is threatened to be made party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that he or she is or was a
director or officer of the corporation, or is or was serving at the request of
the corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him or her in connection with such action, suit or proceeding if he
or she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to, the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his or
her conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person did not
act in good faith and in a manner which he or she reasonably believed to be in
or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had reasonable cause to believe that his or
her conduct was unlawful.
<PAGE>
(b) The corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the corporation to procure a judgment
in its favor by reason of the fact that he or she is or was a director or
officer of the corporation, or is or was serving at the request of the
corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in
connection with the defense or settlement of such action or suit if he or
she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the corporation, except that no
indemnification shall be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the
corporation unless, and only to the extent that, the Court of Chancery of
the State of Delaware or the court in which action or suit was brought
shall determine upon application that, despite the adjudication of
liability and in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery of the State of Delaware or such other court shall deem
proper.
(c) To the extent that any person referred to in paragraphs (a) and (b) of this
Section 7.1 has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to therein or in defense of any
claim, issue or matter therein, he or she shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by
him or her in connection therewith.
(d) Any indemnification under paragraphs (a) and (b) of this Section 7.1
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the director or officer is proper in the circumstances because he or she
has met the applicable standard of conduct set forth in paragraphs (a) and
(b) of this Section 7.1. Such determination shall be made (i) by the board
of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding or (ii) if such quorum
is not obtainable, or, even if obtainable a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or
(iii) by the stockholders.
(e) Expenses (including attorneys' fees) incurred in defending any civil,
criminal, administrative or investigative action, suit or proceeding may be
paid by the corporation in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of such
director or officer to repay such amount if it shall ultimately be
determined that he or she is not entitled to be indemnified by the
corporation as provided in this Section 7.1. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon
such terms and conditions, if any, as the board of directors deems
appropriate.
(f) The indemnification and advancement of expenses provided by or granted
pursuant to this Section 7.1 shall not be deemed exclusive of any other
rights to which those seeking indemnification or advancement of expenses
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his or her
official capacity and as to action in another capacity while holding such
office.
(g) The corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against any
liability asserted against him or her and incurred by him or her in any
such capacity, or arising out of his or her status as such, whether or not
the corporation would have the power to indemnify him or her against such
liability under the provisions of this Section 7.1.
(h) For purposes of this Section 7.1, references to "other enterprises" shall
include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to an employee benefit plan;
and references to "serving at the request of the corporation" shall include
any service as a director, officer, employee or agent of the corporation
which imposes duties on, or involves services by, such director, officer,
employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in
a manner he or she reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this Section 7.1.
<PAGE>
(i) The indemnification and advancement of expenses provided by, or granted
pursuant to, this Section 7.1 shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such person.
(j) Unless otherwise determined by the board of directors, references in this
section to "the corporation" shall not include in addition to the resulting
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify
its directors, officers, and employees or agents, so that any person who is
or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall
stand in the same position under this section with respect to the resulting
or surviving corporation as he or she would have with respect to such
constituent corporation if its separate existence had continued.
Section 7.2 EMPLOYEES AND AGENTS. The board of directors may, by resolution,
extend the indemnification provisions of the foregoing Section 7.1 to any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding by reason of the fact that he or
she is or was an employee or agent of the corporation, or is or was serving at
the request of the corporation as an employee or agent of another corporation,
partnership, joint venture, trust or other enterprise.
<PAGE>
Item 16.
(a). Exhibits.
Exhibit No. Description
1.1 Form of Representative's Warrant issued to Dain Bosworth Incorporated*
3.1 Certificate of Incorporation, as amended, of Quad City Holdings, Inc.*
3.2 Bylaws of Quad City Holdings, Inc.*
4.1 Specimen Stock Certificate of Quad City Holdings, Inc. (See also
Articles VIII, XII and XIII of Exhibit 3.1 and Articles II, VI, IX and
XII of Exhibit 3.2)*
5.1 Opinion of Barack, Ferrazzano, Kirschbaum & Perlman regarding legality
of securities being registered
10.1 Quad City Holdings, Inc. Stock Option Plan*
10.2 Form of Stock Option Agreement between Quad City Holdings, Inc. and each
of Michael A. Bauer, Douglas M. Hultquist and Victor J. Quinn, with
attached schedule of options granted*
10.3 Employment Agreement between Quad City Holdings, Inc. and Michael A.
Bauer dated May 4, 1993*
10.4 Employment Agreement between Quad City Holdings, Inc. and Michael A.
Bauer dated July 1, 1993*
10.5 Employment Agreement between Quad City Holdings, Inc. and Douglas M.
Hultquist dated April 30, 1993*
10.6 Employment Agreement between Quad City Holdings, Inc. and Douglas M.
Hultquist dated July 1, 1993*
22.1 Subsidiaries of Quad City Holdings, Inc.*
23.1 Consent of Barack, Ferrazzano, Kirschbaum & Perlman (included in opinion
filed as Exhibit 5.1)
23.2 Consent of McGladrey & Pullen LLP
24.1 Power of Attorney (included on the signature page of this Registration
Statement)
* Incorporated by reference.
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;
(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 to such information in the
Registration Statement;
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, 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 that remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act 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
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 Securities 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 Securities Act and will be governed by
the final adjudication of such issue.
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form S-3 and authorized this Registration
Statement to be signed on its behalf by the undersigned, thereunder duly
authorized, in the City of Bettendorf, State of Iowa, on June 16, 1997.
QUAD CITY HOLDINGS, INC.
By: /s/ Douglas M. Hultquist
------------------------------
Douglas M. Hultquist
President and Chief Executive
Officer
POWER OF ATTORNEY
Know all men by these presents, that each person whose signature appears below
constitutes and appoints Michael C. Bauer and Douglas M. Hultquist, and each of
them, his true and lawful attorney-in-fact and agent, each with full power of
substitution and re-substitution, for him and in his name, place and stead, in
any and all capacities (including in his capacity as a director or officer of
Quad City Holdings, Inc.) to sign any or 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 attorney-in-fact and
agent 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 might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or any of them, or his
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 each of the following persons in the capacities
indicated on the dates indicated below on June 16, 1997.
Signature Title
/s/ Michael A. Bauer
- ----------------------------------------
Michael A. Bauer Chairman of the Board of
Directors
/s/ Douglas M. Hultquist
- ----------------------------------------
Douglas M. Hultquist President, Principal
Executive, Financial and
Accounting Officer and
Director
/s/ James Brownson
- ----------------------------------------
James Brownson Director
- ----------------------------------------
Robert VanVooren Director
/s/ Richard R. Horst
- -----------------------------------------
Richard R. Horst Director and Secretary
- -----------------------------------------
Ronald G. Peterson Director
- ------------------------------------------
John W. Schricker Director
<PAGE>
<TABLE>
<S> <C>
No dealer, salesperson or any other person has been authorized to give 25,000 shares
information or make any representation not contained in this Prospectus in
connection with the offer made in this Prospectus, and if given or made, such
information or representation must not be relied upon as having been authorized
by the Company or the selling stockholders. This Prospectus does not constitute
an offer to sell or a solicitation by anyone 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 anyone to whom it is unlawful to
make such offer or solicitation. Neither the delivery of this Prospectus nor any
sale made hereunder shall under any circumstances create any implication that
the affairs of the Company since the date hereof or the information herein is
correct as of any time subsequent to the date of this Prospectus. QUAD CITY HOLDINGS, INC.
------------------------ Common Stock
TABLE OF CONTENTS
Page
Available Information.............................
Documents Incorporated by Reference...............
Risk Factors......................................
The Company.......................................
Use of Proceeds...................................
Selling Stockholders.............................. ----------
Plan of Distribution.............................. PROSPECTUS
Description of Capital Stock...................... -----------
Legal Opinions....................................
Experts...........................................
- ------------------------
</TABLE>
, 1997
Barack Ferrazzano Kirschbaum Perlman & Nagelberg
333 WEST WACKER DRIVE, SUITE 2700
CHICAGO, ILLINOIS 60606
Telephone (312) 984-3100
Facsimile (312) 984-3193
Quad City Holdings, Inc.
2118 Middle Road
Bettendorf, Iowa 52722
Ladies and Gentlemen:
We have acted as special counsel to Quad City Holdings, Inc., a
Delaware corporation (the "Company"), in connection with the proposed offering
of 25,000 shares of its common stock, $1.00 par value ("Common Shares"),
issuable to Dain Bosworth Incorporated ("Dain Bosworth") pursuant to a warrant
dated October 13, 1993 (the "Warrant") and to be sold by Dain Bosworth in an
offering (the "Offering") pursuant to the Form S-3 Registration Statement to be
filed with the Securities and Exchange Commission (the "SEC") on June 16, 1997
(the "Registration Statement"). Capitalized terms used, but not defined, herein
shall have the meanings given such terms in the Registration Statement. You have
requested our opinion concerning certain matters in connection with the
Offering.
We have made such legal and factual investigation as we deemed
necessary for purposes of this opinion. In our investigation, we have assumed
the genuineness of all signatures, the proper execution of all documents
submitted to us as originals, the conformity to the original documents of all
documents submitted to us as copies and the authenticity of the originals of
such copies.
In arriving at the opinions expressed below, we have reviewed and
examined the following documents:
a. the Certificate of Incorporation of the Company filed with the
Secretary of the State of the State of Delaware on February 4,
1993, as amended and corrected, and the Company's Bylaws;
b. the Registration Statement, including the prospectus constituting
a part thereof (the "Prospectus");
c. Resolutions of the Board of Directors of the Company (the
"Board") relating to the Warrant; and
d. a form of share certificate representing the Common Shares
approved by the Board.
We call your attention to the fact that our firm only requires lawyers
to be qualified to practice law in the State of Illinois and, in rendering the
foregoing opinions, we express no opinion with respect to any laws relevant to
this opinion other than the Securities Act of 1933, as amended, and the rules
and regulations thereunder, the laws and regulations of the State of Illinois,
the General Corporation Law of the State of Delaware and United States federal
law.
Based upon the foregoing, but assuming no responsibility for the
accuracy or the completeness of the data supplied by the Company and subject to
the qualifications, assumptions and limitations set forth herein, it is our
opinion that:
1. The Company has been duly organized and is validly existing in good
standing under the laws of the State of Delaware and has due corporate authority
to carry on its business as it is presently conducted.
2. The Company is authorized to issue up to 2,500,000 Common Shares, of
which 1,437,824 Common Shares have been issued and are presently outstanding
prior to the Offering.
3. When the Registration Statement shall have been declared effective
by order of the SEC and the Common Shares to be sold thereunder shall have been
issued pursuant to the terms and conditions set forth in the Warrant, then such
Common Shares will be legally issued, fully paid and non-assessable.
We express no opinion with respect to any specific legal issues other
than those explicitly addressed herein. We assume no obligation to advise you of
any change in the foregoing subsequent to the date of this opinion (even though
the change may affect the legal conclusion stated in this opinion letter).
<PAGE>
We hereby consent (i) to be named in the Registration Statement, and in
the Prospectus, as attorneys who will pass upon the legality of the Common
Shares to be sold thereunder and (ii) to the filing of this opinion as an
Exhibit to the Registration Statement.
Sincerely,
/s/ BARACK FERRAZZANO KIRSCHBAUM PERLMAN & NAGELBERG
INDEPENDENT AUDITOR'S CONSENT
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-3 of our report dated July 26, 1996, which appears on page
16 of the annual report on Form 10-KSB of Quad City Holdings, Inc. for the year
ended June 30, 1996, and to the reference to our Firm under the caption
"Experts" in the Prospectus.
/s/ McGLADREY & PULLEN, LLP
Davenport, Iowa
June 16, 1997
