SEMI-ANNUAL REPORT
FOR REGISTERED INVESTMENT COMPANIES
Report for six month period ending: // (a)
or fiscal year ending: 6/30/99(b)
Is this a transition report? (Y/N) N
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Is this an amendment to a previous filing? (Y/N) N
---
Those items or sub-items with a box "[ ]" after the item number should be
completed only if the answer has changed from the previous filing on this form.
1. A. Registrant Name: Waterside Capital Corporation
B. File Number: 811-8387
C. Telephone Number: 757-626-1111
2. A. Street: 300 East Main Street, Suite 1380
B. City: Norfolk C. State: VA.
D. Zip Code: 23510 Zip Ext:
E. Foreign Country: Foreign Postal Code:
3. Is this the first filing on this form by Registrant? (Y/N) N
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4. Is this the last filing on this form by Registrant? (Y/N) N
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5. Is Registrant a small business investment company (SBIC)? (Y/N) Y
[If answer is "Y" (Yes), complete only items 89 through 110.] -----
6. Is Registrant a unit investment trust (UIT)? (Y/N) -----
[If answer is "Y" (Yes) complete only items 111 through 132.]
7. A. Is Registrant a series or multiple portfolio company? (Y/N)
[If answer is "N" (No), go to item 8.] -----
B. How many separate series or portfolios did Registrant have
at the end of the period? -----
01
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If filing more than one
Page 37, "X" box: [ ]
For period ending 6/30/99
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File number 811- 8387
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SMALL BUSINESS INVESTMENT COMPANIES
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INVESTMENT ADVISER
89. A. [ ] Adviser Name (If any):
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B. [ ] File Number: 801-
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C. [ ] City: State: Zip Code: Zip Ext.:
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[ ] Foreign Country: Foreign Postal Code:
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89. A. [ ] Adviser Name (If any):
------------------------------------------
B. [ ] File Number: 801-
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C. [ ] City: State: Zip Code: Zip Ext.:
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[ ] Foreign Country: Foreign Postal Code:
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TRANSFER AGENT
90. A. [ ] Transfer Agent Name (If any): Reliance Trust Company
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B. [ ] File Number: 08-845482
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C. [ ] City: Atlanta State: GA Zip Code: 30326 Zip Ext.: 1106
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[ ] Foreign Country: Foreign Postal Code:
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90. A. [ ] Transfer Agent Name (If any):
-----------------------------------
B. [ ] File Number -
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C. [ ] City: State: Zip Code: Zip Ext.:
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[ ] Foreign Country: Foreign Postal Code:
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INDEPENDENT PUBLIC ACCOUNTANT
91. A. [ ] Accountant Name: KPMG LLP
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B. [ ] City: Norfolk State: VA Zip Code: 23510 Zip Ext.:
----------- ----- --------- --------
C. [ ] Foreign Country: Foreign Postal Code:
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91. A. [ ] Accountant Name:
------------------------------------------------
B. [ ] City: State: Zip Code: Zip Ext.:
----------- ---------- ----- ------
C. [ ] Foreign Country: Foreign Postal Code:
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37
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If filing more than one
Page 38, "X" box: [ ]
For period ending 6/30/99
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File number 811- 8387
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CUSTODIAN
92. A. [ ] Custodian: Cenit Bank
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B. [ ] City: Norfolk State: VA Zip Code: 23510 Zip Ext.:
-------- --- ----- ------
C. [ ] Foreign Country: Foreign Postal Code:
---------------- -------
D. [ ] Mark one of the following with an "X":
TYPE OF CUSTODY
Member Nat'l Foreign Insurance Co.
Bank Sec. Exchg. Self Custodian Sponsor
Sec. 17(f)(l) Rule 17f-l Rule 17f-2 Rule 17f-5 Rule 26a-2 Other
- ------------- ------------ ---------- ---------- ------------- -----
X
NOTE: If self-custody, give name of safekeeping depository and location of
assets in sub-items 92A and 92B.
E. [ ] Does Registrant's custodian maintain some or all of registrant's
securities in a central depository or book-entry system
pursuant to Rule 17f-4? (Y/N) Y
---------------------------------
Y/N
93. [ ] Does Registrant's adviser(s) have advisory clients other than
investment companies? (Y/N)
---------------------------------
Y/N
94. Family of investment companies information:
A. [ ] Is Registrant part of a family of investment
companies? (Y/N) N
--------------------------------
Y/N
B. [ ] If "Y" (Yes) state the number of registered management investment
companies in the family:
-------------------------------------------
(NOTE: count as a separate company each series of a series company
and each portfolio of a multiple portfolio company; exclude all
series of unit investment trusts from this number.)
C. [ ] Identify the family using 10 letters:
-- -- -- -- -- -- -- -- -- --
(NOTE: In filing this form, use this identification consistently for
all investment companies in the family including any unit investment
trusts. This designation is for purposes of this form only.)
D. [ ] Is Registrant a wholly-owned subsidiary of a business development
company ("BDC")? (Y/N) N
---------------------------------------------
Y/N
E. [ ] If "Y" (Yes), identify the BDC as follows:
BDC name:
File Number: 2- or 33-
38
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If filing more than one
Page 39, "X" box: [ ]
For period ending 6/30/99
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File number 811 - 8387
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95. Sales, repurchases, and redemptions of Registrant's securities
during the period:
Number of Shares Net
or Principal Consideration
Amount of Debt Received or Paid
Class of Security ($000's omitted) ($000's omitted)
- --------------------------------- ----------------- ----------------
Common Stock:
A. [ ] Sales $
---------------- -----------
B. [ ] Repurchases $
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Preferred Stock:
C. [ ] Sales $
---------------- -----------
D. [ ] Repurchases and redemptions $
---------------- -----------
Debt Securities:
E. [ ] Sales $ $
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F. [ ] Repurchases and redemptions $ $
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96. Securities of Registrant registered on a National Securities Exchange
or listed on NASDAQ:
CUSIP or Ticker
Title of each class of securities NASDAQ No. Symbol
--------------------------------- ---------- ------
A. [ ] Common Stock 941872 10 3 WSCC
-------------------------- ----------- ------
B. [ ]
-------------------------- ----------- ------
C. [ ]
-------------------------- ----------- ------
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For period ending 6/30/99 If filing more than one
------------- Page 40, "X" box: [ ]
File number 811- 8387
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FINANCIAL INFORMATION
97. A. How many months do the answers to items 97 and 98
cover? 12 Months
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<TABLE>
<CAPTION>
For Period covered by this form
($000's omitted)
INCOME
<S> <C>
B. Net interest income $878
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C. Net dividend income $1,072
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D. Account maintenance fees $
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E. Net other income $947
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EXPENSES
F. Gross advisory fees $
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G. Gross administrator(s) fees $
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(Negative answers allowed for 97H through 97S)
H. Salaries and other compensation $914
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I. Shareholder servicing agent fees $ 11
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J. Custodian fees $
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K. Postage $ 3
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L. Printing expenses $19
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M. Directors' fees $
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N. Registration fees $
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O. Taxes $51
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P. Interest $418
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Q. Bookkeeping fees paid to anyone performing this service $
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R. Auditing fees $63
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S. Legal fees $59
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</TABLE>
40
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For period ending 6/30/99 If filing more than one
------------- Page 41, "X" box: [ ]
File number 811- 8387
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<TABLE>
<CAPTION>
Expenses (Negative answers allowed on this screen for For period by this form
97T through 97W and 97Z only) ($000's omitted)
<S> <C>
T. Marketing/distribution payments including payments pursuant to a
Rule 12b-1 plan $
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U. Amortization or organization expenses $
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V. Shareholder meeting expenses $ 9
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W. Other expenses $ 309
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X. Total expenses $ 1,856
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Y. Expense reimbursements $
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Z. Net investment income $ 1,041
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AA. Realized capital gains $ 234
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BB. Realized capital losses $
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CC. 1. Net unrealized appreciation during the period $
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2. Net unrealized depreciation during the period $ 238
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DD. Total income dividends for which record date passed during the period $
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EE. Total capital gains distributions for which record date passed
during the period $
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98. Payments per share outstanding during the entire current period:
A. Dividends from net investment income $ **
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NOTE: Show in fractions of a cent is so declared.
B. Distributions of capital gains $ **
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C. Other distributions $
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NOTE: Show in fractions of a cent if so declared.
* Negative answer permitted in this field.
** Items 98A and 98B should be of the form mn.nnnn (where n = integer)
</TABLE>
41
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If filing more than one
Page 42, "X" box: [ ]
For period ending 6/30/99
File number 811-8387
<TABLE>
<CAPTION>
As of the end of
current reporting
period (000's
99. Assets, liabilities, shareholders' equity: omitted)
--------
<S> <C>
A. Cash $ 269
B. Repurchase agreements $ 1,000
C. Short-term debt securities other than repurchase agreements $
D. Long-term debt securities including convertible debt $ 6,894
E. Preferred, convertible preferred and adjustable rate preferred stock $16,146
F. Common stock $ 925
G. Options on equities $ 377
H. Options on all futures $
I. Other investments $
J. Receivables from portfolio instruments sold $
K. Receivables from affiliated persons $
L. Other receivables $ 690
M. All other assets $ 809
N. Total assets $27,110
</TABLE>
42
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If filing more than one
Page 43, "X" box: [ ]
For period ending 6/30/99
File number 811-8387
As of the end of
current reporting
period (000's
omitted except for
per share
amounts and
number of
accounts)
---------
O. Payables for portfolio instruments purchased $
P. Amounts owned to affiliated persons $
Q. Senior long-term debt $12,300
R. All other liabilities $ 739
S. Senior equity $
T. Net assets of common shareholders $14,071
U. Number of shares outstanding $ 1,492
V. Net asset value per share (to nearest cent) $ 9.43*
W. Mark-to-market net asset value per share for money market
funds only (to 4 decimals) $ **
X. Total number of shareholder accounts $ 646
Y. Total value of assets in segregated accounts $
100. Monthly average net assets during current reporting period
($000's omitted) $13,410
101. Market price per share at end of period $ 6.75
* Net asset value per share must be of the form nnn.nn (where n = integer).
** Value must be of the form nnn.nnnn (where n = integer).
43
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If filing more than one
Page 44, "X" box: [ ]
For period ending 6/30/99
File number 811-8387
102. A. Is the Registrant filing any of the following attachments
with the current filing of Form N-SAR? Y
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Y/N
NOTE: If answer is "Y" (Yes), mark those items below being
filed as an attachment to this form or incorporated --------
by reference. Y/N
B. Matters submitted to a vote of security holders Y
--------
C. Policies with respect to security investments --------
D. Legal proceedings --------
E. Changes in security for debt --------
F. Defaults and arrears on senior securities --------
G. Changes in control of Registrant --------
H. Terms of new or amended securities --------
I. Revaluation of assets or restatement of
capital share account --------
J. Changes in Registrant's certifying accountant
--------
K. Changes in accounting principles and practices --------
L. Mergers --------
M. Actions required to be reported pursuant to Rule 2a-7 --------
N. Transactions effected pursuant to Rule 10f-3 --------
O. Information required to be filed pursuant to existing
exemptive orders --------
Attachment Information (Cont. on Screen 53)
44
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If filing more than one
Page 45, "X" box: [ ]
For period ending 6/30/99
File number 811-
Attachment Information (Cont. from Screen 52)
102. P. 1. Exhibits Y
--------
Y/N
2. Any information called for by instructions to
sub-item 102 P2 --------
Y/N
3. Any information called for by instructions to
sub-item 102 P3
--------
Y/N
103. [ ] Does the Registrant have any wholly-owned investment
company subsidiaries whose operating & financial
data are consolidated with that of Registrant in
this report? (Y/N) N
-------
Y/N
[If answer is "N" (No), go to item 105]
104. [ ] List the "811" numbers and names of Registrant's
wholly-owned investment company subsidiaries
consolidated in this report.
811 Numbers Subsidiary Name
----------- --------------------------------------------------
45
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For period ending 6/30/99 If filing more than one
------------- Page 46, "X" box: [ ]
File number 811- 8387
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ANNUAL SUPPLEMENT
- -----------------
Page 53 is to be filed only once each year at the end of Registrant's
fiscal year.
<TABLE>
<CAPTION>
105. Fidelity bond(s) in effect at the end of the period:
<S> <C>
A. [ ] Insurer Name: American Dynasty Surplus Lines Insurance Company
B. [ ] Second Insurer:
C. [ ] Aggregate face amount of coverage for Resident on all bonds on
which it is named as an insured ($000's omitted) $5,000
-------------------------- ------
106. A. [ ] Is the bond part of a joint fidelity bond(s) shared with other
investment companies or other entities? N
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Y/N
B. [ ] If the answer to 106A is "Y" (Yes), how many other investment companies or
other entities are covered by bond?
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NOTE: Count each series as a separate investment company.
107. A. [ ] Does the mandatory coverage of the fidelity bond have a deductible? Y
------- ------
Y/N
B. [ ] If the answer to 107A is "Y" (Yes), what is the amount of the
deductible? $50
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108. A. [ ] Were any claims with respect to this Registrant filed under the bond
during the period? N
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Y/N
B. [ ] If the answer to 108A is "Y" (Yes), what was the total amount of such
claim(s)?
------------------------- ------
109. A. [ ] Were any losses incurred with respect to this Registrant that could
have been filed as a claim under the fidelity bond but were not?
N
------------------------- ------
Y/N
B. [ ] If the answer to sub-item 109A is "Y" (Yes), what was the total amount
of such losses? ($000's omitted) $
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110. A. [ ] Are Registrant's officers and directors covered as officers and directors of
Registrant under any errors and omissions insurance policy owned by
the Registrant or anyone else? Y
----------------------------------------- ------
Y/N
B. [ ] Were any claims filed under such policy during the period with respect
to Registrant? N
------------------------------------------------------------ ------
Y/N
</TABLE>
46
<PAGE>
Item 132: "811" number of series included in filing
This item is to be used by any series of a UIT that had an "811" number
assigned to it prior to September 1972. For more information regarding this
item, see the instruction to sub-item 1B.
Signature Page
The following form of signature shall follow items 79, 85, 88, 104, 110 or
132 as appropriate.
This report is signed on behalf of the registrant (or depositor or trustee).
City of: Norfolk State of: Virginia Date: 8/26/99
------------- ------------- ----------------
Name of Registrant, Depositor, or Trustee:
Waterside Capital Corporation /s/ J. Alan Lindauer
- -------------------------------- -------------------------------
By (Name and Title): Witness (Name and Title): President
Gerald T. McDonald
- -------------------
Secretary and Chief Financial Officer
SEC's Collection of Information
An agency may not conduct or sponsor, and a person is not required to respond
to, a collection of information unless it displays a currently valid control
number. Filing of this Form is mandatory. Section 30 of the Investment
Company Act of 1940 ("1940 Act") and the rules thereunder, and Sections 13
and 15(d) of the Securities Exchange Act of 1934 require investment companies
to file annual and periodic reports with the Commission. The Commission has
specified Form N-SAR for report for investment companies. The Commission
staff uses the information in performing inspections of investment companies,
selectively reviewing registration documents filed under the 1940 Act and
the Securities Act of 1933 and conducting studies and other types of analyses
necessary to keep the Commission's regulatory program for investment companies
current in relation to changing industry conditions. The information collected
on Form N-SAR is publicly available. Any member of the public may direct to
the Commission any comments concerning the accuracy of the burden estimate
of this Form and any suggestions for reducing the burden of the Form. This
collection of information has been reviewed by the Office of Management
and Budget in accordance with the clearance requirements of 44 U.S.C.
(Section)3507.
Exhibit
Item 102 B Matters submitted to a vote of securities holders
a) Annual Meeting of Shareholders held on October 22, 1998
b) Directors elected:
James E. Andrews
Donna C. Bennett
J.W. Whiting Chisman, Jr.
Jeffrey R. Ellis
Eric L. Fox
Roger L. Frost
Ernest F. Hardee
Henry U. Harris, III
J. Alan Lindauer
Robert I. Low
Harold J. Marioneaux, Jr.
Peter M. Meredith, Jr.
Charles H. Merriman
Augustus C. Miller
Paul F. Miller
Juan M. Montero, II
R. Scott Morgan, Sr.
James W. Noel, Jr.
Richard G. Ornstein
Richard A. Schreiber
Jordan E. Slone
Additional director:
Marvin S. Friedberg, appointed in May 1999
<PAGE>
c) Matters voted upon at the meeting
Votes Votes Broker
For Against Abstain Non Vote*
-----------------------------------------
item 1 To amend the Company's
Articles of Incorporation 1,011,191 1,000 110,390 298,319
attached as Exhibit A
item 2 To approve the Company's
1998 Employee Stock
Option Plan allocating 989,791 16,400 116,390 298,319
100,000 shares for which
awards may be granted
*Broker non votes occur where a broker holding stock in street name
does not vote those shares.
<PAGE>
EXHIBIT A TO PROXY STATEMENT
ARTICLES OF AMENDMENT
OF
WATERSIDE CAPITAL CORPORATION
Pursuant to Section 13.1-710 of the Code of Virginia of 1950, as amended,
the following information is provided:
1. The name of the Corporation is Waterside Capital Corporation.
2. Article VIII, Section 8.1 is hereby deleted from the Articles of
Incorporation and replaced with the following section:
8.1 Upon the occurrence of any of the events specified in 13 C.F.R.
107.1810(d)(I)-(6), 107.1810(f)(I)-(3), 107.1820(b) or 107.1820(c) as
determined by the SBA, SBA shall have the right, and the corporation
consents to, SBA's exercise of such right:
(i) upon written notice, to require the corporation to replace, with
individuals approved by SBA, one or more of the Corporation's officers
and/or such number of members of the Corporation's Executive Committee
as is sufficient to constitute a majority of such Executive Committee; or
(ii) to obtain the appointment of SBA or its designee as receiver of
the corporation pursuant to 311(c) of the SBIC Act for the purpose of
continuing to operate the Corporation.
3. Pursuant to Section 13.1-710 of the Code of Virginia of 1950, as
amended, the Board of Directors of the Corporation submitted this amendment to
the shareholders at the Annual Meeting of the shareholders on October 22, 1998.
4. Pursuant to Section 13.1-654 of the Code of Virginia of 1950, as
amended, the Shareholders of the Corporation adopted this amendment at the
Annual Meeting of the Shareholders. Holders of shares of common stock were
eligible to vote on the adoption of the amendment. At the close of business on
August 14, 1998, the date fixed by the Board of Directors as the record date for
the meeting of the shareholders, 1,420,900 shares of common stock were
outstanding. Of those shares, were voted for the amendment, were
voted against the amendment and abstained. The number of shares of common
stock voted for the amendment was sufficient to approve the amendment.
Dated the day of , 1998.
WATERSIDE CAPITAL CORPORATION
By _________________________________
J. Alan Lindauer, President
