As filed with the Securities and Exchange Commission on March 27, 2003
Registration No. 333-102843
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
AMENDMENT NO. 3
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------------------
ALLEGIANT BANCORP, INC.
(Exact name of registrant as specified in its charter)
----------------------
MISSOURI 10401 CLAYTON ROAD 43-1262037
(State or other ST. LOUIS, MISSOURI 63131 (I.R.S. Employer
jurisdiction of (314) 692-8200 Identification No.)
incorporation
or organization)
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
----------------------
JEFFREY S. SCHATZ
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
ALLEGIANT BANCORP, INC.
10401 CLAYTON ROAD
ST. LOUIS, MISSOURI 63131
(314) 692-8200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------------
THOMAS A. LITZ, ESQ. Copies to: EDWIN S. DEL HIERRO, ESQ.
THOMAS E. PROOST, ESQ. WILLIAM E. TURNER II, ESQ.
THOMPSON COBURN LLP BARACK FERRAZZANO KIRSCHBAUM
SUITE 3400 PERLMAN & NAGELBERG LLC
ONE US BANK PLAZA 333 WEST WACKER DRIVE, SUITE 2700
ST. LOUIS, MISSOURI 63101 CHICAGO, ILLINOIS 60606
(314) 552-6000 (TELEPHONE) (312) 984-3100 (TELEPHONE)
(314) 552-7000 (FAX) (312) 984-3150 (FAX)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO 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. / /
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration number of the 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, please 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. / /
----------------------
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 SECURITIES AND EXCHANGE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
============================================================================
Subject to completion, dated March 27, 2003
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
* The information in this prospectus is not complete and may be changed. We *
* may not sell these securities until the registration statement filed with *
* the Securities and Exchange Commission is effective. This prospectus is not *
* an offer to sell these securities and it is not soliciting an offer to buy *
* these securities in any state where the offer or sale is not permitted. *
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
PROSPECTUS
1,700,000 SHARES
[Allegiant Bancorp logo]
COMMON STOCK
We are selling 1,700,000 shares of our common stock. Our common
stock is listed on the Nasdaq National Market under the symbol "ALLE." On
March 26, 2003, the last sale price of our common stock as reported by
the Nasdaq National Market was $16.60 per share.
INVESTING IN OUR COMMON STOCK INVOLVES SIGNIFICANT RISKS. YOU
SHOULD READ THE "RISK FACTORS" SECTION BEGINNING ON PAGE 8 BEFORE INVESTING.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION OR REGULATORY BODY HAS APPROVED OR DISAPPROVED OF
THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE NOT DEPOSITS OR ACCOUNTS OR OBLIGATIONS OF ANY
BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY.
PER SHARE TOTAL
----------- ---------
Public offering price............................ $ $
Underwriting discount............................ $ $
Proceeds, before expenses, to Allegiant.......... $ $
This is a firm commitment offering. We have granted to the
underwriters a 30-day option to purchase up to 255,000 additional shares to
cover over-allotments, if any.
The underwriters expect to deliver the shares on or about ,
2003, subject to customary closing conditions.
LEGG MASON WOOD WALKER
INCORPORATED
RBC CAPITAL MARKETS
STIFEL, NICOLAUS & COMPANY
INCORPORATED
HOWE BARNES INVESTMENTS, INC.
The date of this Prospectus is , 2003
ALLEGIANT BANCORP, INC.
ST. LOUIS METROPOLITAN AREA BANKING FACILITIES
[MAP]
[The inside front cover of the prospectus depicts
a map of the metropolitan St. Louis service territory of
Allegiant Bank showing its branch locations.]
TABLE OF CONTENTS
PAGE
----
ABOUT THIS PROSPECTUS.....................................................i
PROSPECTUS SUMMARY........................................................1
RISK FACTORS..............................................................8
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS................13
USE OF PROCEEDS..........................................................14
MARKET FOR COMMON STOCK AND DIVIDENDS....................................14
CAPITALIZATION...........................................................16
MANAGEMENT...............................................................18
STOCK OWNERSHIP OF MANAGEMENT AND PRINCIPAL SHAREHOLDERS.................21
DESCRIPTION OF CAPITAL STOCK.............................................23
UNDERWRITING.............................................................25
LEGAL MATTERS............................................................27
EXPERTS..................................................................27
WHERE YOU CAN FIND ADDITIONAL INFORMATION................................27
INCORPORATION BY REFERENCE...............................................28
ABOUT THIS PROSPECTUS
You should rely only on the information contained in this
prospectus or incorporated by reference into this prospectus. We have not,
and the underwriters have not, authorized any other person to provide you
with different information. The information contained in this prospectus is
accurate only as of the date of this prospectus, regardless of the time of
delivery of this prospectus or of any sale of common stock. Unless otherwise
indicated, all information in this prospectus assumes that the underwriters
will not exercise their option to purchase additional shares of common stock
to cover over-allotments.
We sometimes refer to Allegiant Bank as the "bank." When we refer
to our branches in the St. Louis metropolitan area, we are excluding two
branches to be sold in connection with the anticipated sale of one of our
two subsidiary banks, Bank of Ste. Genevieve, to First Banks, Inc.
To understand this offering fully, you should read this entire
document carefully, including particularly the "Risk Factors" section, as
well as the documents identified in the section titled "Where You Can Find
Additional Information."
i
(This page has been left blank intentionally.)
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in, or
incorporated by reference into, this prospectus. Because this is a summary,
it may not contain all information that may be important to you. Therefore,
you should read the entire prospectus, our financial statements, including
the related notes, and the other information that is incorporated by
reference into this prospectus before making a decision to invest in our
common stock.
ALLEGIANT BANCORP, INC.
We are the largest publicly-held bank holding company headquartered
in the St. Louis metropolitan area. Our principal subsidiary, Allegiant
Bank, offers full-service banking and personal trust services to
individuals, businesses and municipalities in our market area. These
services include commercial real estate, commercial business and consumer
loans, checking, savings and time deposit accounts, wealth management and
other fiduciary services, as well as other financial services, including
mortgage banking, securities brokerage and insurance products. As of
December 31, 2002, we reported, on a consolidated basis, total assets of
$2.4 billion, loans of $1.7 billion and shareholders' equity of $167.2
million. This represents growth of 10.8%, 19.9% and 21.1%, respectively, when
compared to our total assets, loans and shareholders' equity as of December
31, 2001.
THE ST. LOUIS MARKET
The St. Louis metropolitan area is the 18th largest metropolitan
market in the United States with a population of approximately 2.5 million.
The St. Louis area is home to 15 Fortune 1000 companies, including
Anheuser-Busch Companies, Inc., Emerson Electric Co. and The May Department
Stores Company. Over the past several years, a number of financial
institutions in our market area have been acquired by larger regional or
national out-of-town financial institutions. These acquisitions have
included: Marshall & Ilsley Corporation's 2002 acquisition of Mississippi
Valley Bancshares, Inc., Firstar Corporation's (now operating as U.S.
Bancorp) 1999 acquisition of Mercantile Bancorporation Inc., Union Planters
Corporation's 1998 acquisition of Magna Group, Inc. and NationsBank
Corporation's (now operating as Bank of America Corporation) 1997
acquisition of Boatmen's Bancshares, Inc. We believe we have capitalized on
opportunities created by this market consolidation and have built a strong,
customer-friendly, community-focused banking franchise.
KEY OPERATING STRENGTHS
We believe the following operating strengths distinguish us from
our competition and position us for further growth and enhanced
profitability:
o Growth in our market. Our primary goal has been to expand our
branch network in the St. Louis market while increasing our earnings per
share. Since our inception in 1989, we have grown through a combination of
internal growth and acquisitions. We have sought to maximize our internal
growth opportunities by positioning Allegiant as one of the leading St.
Louis community banks. From the beginning of 2000 to the end of 2002,
we estimate that our deposits and loans, excluding those added through
acquisitions, have grown at a compound annual rate of approximately
16.4% and 19.9%, respectively. From the beginning of 1998 to the end
of 2002, our diluted earnings per share have increased at a compound
annual rate of 22.1%. We cannot assure you that we will continue to
grow at historical rates or, to the extent we continue to grow,
that we will be able to adequately and profitably manage our growth. We
discuss factors that may negatively affect our future results under "Risk
Factors--Difficulties in managing operating risks resulting from our growth
may adversely affect our earnings and financial condition," "--Future growth
through acquisitions may subject us to special risks which may negatively
affect our earnings per share and our financial condition," and "--It may
1
be difficult for us to maintain our historical growth rate, which may
adversely impact our results of operations."
We have supplemented our internal growth with several acquisitions
within our market area. Since 2000, we have completed a number of
significant acquisitions, including: Equality Bancorp, Inc., a
community-based thrift holding company with total assets of approximately
$300.4 million, in November 2000; Southside Bancshares Corp., a
community-based bank holding company with total assets of approximately
$804.9 million, in September 2001; and five branches from Guardian Savings
Bank with total deposits of $109.3 million, in December 2001. Additionally,
in order to diversify our operations and sources of income, in October 2002,
we acquired Investment Counselors, Incorporated, an investment advisory firm
with approximately $331.9 million of assets under management.
Consistent with our focus on establishing and maintaining a strong
presence in the most attractive areas in the St. Louis market, in September
2002, we entered into an exchange agreement to sell Bank of Ste. Genevieve,
one of our two subsidiary banks, to First Banks, Inc. Bank of Ste. Genevieve
operates two branches located outside of the St. Louis metropolitan area and
has total assets of approximately $110.0 million. Under the exchange
agreement, First Banks will acquire Bank of Ste. Genevieve in exchange for
approximately 974,150 shares of our common stock held by First Banks. The
terms of the exchange agreement include representations, warranties,
covenants and closing conditions typical for transactions of this size and
type. The net assets of Bank of Ste. Genevieve are approximately $17.9
million which approximates the value of consideration we expect to receive.
As a result, we do not expect to recognize any gain or loss as a result of
the transaction. First Banks currently holds approximately 7.4% of our
outstanding common stock and will hold approximately 1.5% of our common
stock upon completion of the exchange. In March 2003, First Banks received
final bank regulatory approvals necessary to complete the exchange. We
expect to complete the sale of Bank of Ste. Genevieve during the first half
of 2003.
o Strong commercial lending franchise. In order to improve the
profitability of our banking operations, over the past several years we have
reduced the number of residential mortgages that we hold in our portfolio
and have increased the amount of higher yielding commercial loans. Since the
beginning of 1998, and in part as a result of opportunities that resulted
from the consolidation of the St. Louis banking market, we have hired 23
commercial lending professionals, including a senior credit officer, who
average more than 15 years of commercial lending experience in the St. Louis
metropolitan area. As these local loan officers have joined our banking
team, we have benefited from their existing customer relationships, as well
as their local banking expertise. Our target lending customers are small to
mid-sized businesses requiring credit ranging in size from $1.0 million to
$3.0 million. As a result of our relationship lending focus, we may make
larger loans based upon the needs of our business customers and consistent
with our loan policy and applicable laws and regulations. During the year
ended December 31, 2002, our commercial business loans grew 23.3%, from
$255.2 million to $314.7 million, and our demand deposit accounts grew 7.1%,
from $201.2 million to $215.5 million. Commercial business loans generally
involve a higher degree of risk than our other types of loans. These risks
are discussed under "Risk Factors--Our exposure to credit risk and loan
losses is increased because we focus on commercial real estate, commercial
business and construction lending, which could adversely affect our earnings
and financial condition."
o Full-service, community banking focus. We focus on serving
customers with banking needs that no longer can be adequately served by
smaller local institutions but who still desire the personalized service
that larger, out-of-state institutions do not effectively provide. Our
community banking focus and streamlined management and decision-making
procedures allow us to respond quickly to the needs of our individual and
business customers and to tailor products and services to meet their needs.
2
We seek to effectively meet the convenience and needs of customers
through our extensive branch network that provides our customers at least
one branch located within a 20-minute drive from all principal sectors of
the St. Louis metropolitan area. Our 37 branches and 59 ATMs throughout the
St. Louis metropolitan area also serve to increase recognition of the
Allegiant name. In addition, we have sought to further enhance our name
recognition by serving as the official bank of the St. Louis Rams football
team since July 2000.
STRATEGY
We believe that our operating strengths and the following
strategies position us for further asset and earnings per share growth:
o Maintain strong asset quality while growing our commercial loan
portfolio. While commercial loan growth is a priority, we remain focused on
asset quality. Although our asset quality has been negatively impacted to
some degree by our recent acquisitions, our ratio of non-performing assets
to total assets improved from 0.93% at December 31, 2001 to 0.68% at
December 31, 2002.
o Continue to build our relationship-based sales culture. We foster
an internal sales culture focused on increasing the number of products that
we provide to our customers. Over the past several years, we have
significantly improved our internal measures of how many banking products or
services we sell to new customers in the first six months of our
relationship with those customers. This improvement has resulted from
various initiatives, including the recent implementation of an enhanced
customer relationship management system to monitor results.
o Expand our core deposit base. Expansion of our core deposit base
will provide us with a cost-effective and stable source of funding for our
loan portfolio. We have improved our non-interest bearing deposits to total
deposits ratio from 10.0% at December 31, 2000 to 12.2% at December 31,
2002, which we attribute, to a significant extent, to our efforts to
cross-sell deposit services to our commercial customers. We will continue to
pursue strategies to increase our non-interest bearing deposits.
o Increase our non-interest income. In order to diversify our
sources of income and to reduce our dependence on net interest income, we
are focused on increasing our non-interest income. Non-interest income as a
percentage of our combined net interest income and non-interest income has
increased from 17.0% in 2000 to 26.4% in 2002. Although our wealth management
division has not historically contributed a significant portion of our total
revenues, we believe that our acquisition of Investment Counselors,
Incorporated, in conjunction with the trust operation we acquired in the
Southside transaction, has positioned this division to contribute
meaningful revenues to our franchise in the future. These acquired operations
enable us to offer a more comprehensive selection of wealth management
products and services to our customers.
o Maintain strong expense controls. We have implemented a company-
wide cost control initiative intended to enhance efficiencies throughout our
organization that we refer to as "Project 2004." In addition, we
consolidated our banking operations into one primary subsidiary, Allegiant
Bank, during 2002. Our increased concentration on cost control efforts is
reflected in the improvement of our efficiency ratio from 59.6% for the year
ended December 31, 2000 to 54.0% for the year ended December 31, 2002.
We believe growth of our average branch size and the resulting
economies of scale contribute significantly to improving our efficiencies.
We have 14 branches that we have owned since December 31, 1999 and which
have not been combined with acquired branches. Average deposits per branch
at these locations increased from $37.5 million at December 31, 1999
to $56.3 million at December 31, 2002, which we believe reflects
the success of our strategy for achieving organic growth.
3
PROJECT 2004
In August 2002, we announced the launch of Project 2004. The
mission of Project 2004 is to improve our operating platform by leveraging
our acquisition expertise internally. We are approaching this project as if
we had acquired our own operations and have evaluated our systems and
strategies in order to enhance our delivery of products and services to
customers, to improve operating efficiencies and to provide increased revenue.
Based on our evaluations, we have undertaken improvement initiatives, several
of which have been completed.
Of our major initiatives, we expect to realize increases in
incremental revenue, beginning in the second half of 2003, at a rate of more
than $750,000 annually from improvements in our retail banking sales
training, measurement and tracking, and of up to $1.0 million annually from
the implementation of a specialized marketing plan for our 11 smallest
branches by deposit size. Our new sales measurement and tracking systems
will improve management's ability to identify products and practices that
are most profitable to us and focus our sales efforts on those products and
practices. Our new training will improve our employees' ability to offer
products to new and existing customers and to implement our most profitable
practices. Our specialized marketing plan includes mail programs and special
promotions directed to current and prospective customers in an effort to
increase deposits at our smaller branches.
In addition, in the first half of 2003 we will implement a new fee
structure, operating procedures and electronic processing systems from which we
expect to realize improvements in operating efficiencies and incremental revenue
at a rate of up to $1.0 million annually. Operating efficiencies we expect to
achieve include more efficient branch staffing, implementation of an automated
credit scoring system for consumer lending and streamlining a variety of
backroom functions such as loan document imaging. We expect to achieve increases
in incremental revenue through fees on new customer services, including an
overdraft protection program for electronic transactions. However, we cannot
assure you that we will be able to realize all of the estimated revenues or
efficiencies from our Project 2004 initiatives.
MANAGEMENT TEAM
Our management team is comprised of experienced individuals who
average more than 15 years in the banking or financial services industries.
Currently, our directors and executive officers own approximately 24% of our
outstanding common stock. Upon the completion of this offering and the
consummation of the proposed sale of Bank of Ste. Genevieve to First Banks,
Inc., our directors and officers would own approximately 23% of our
outstanding common stock.
* * *
Our principal executive offices are located at 10401 Clayton Road,
St. Louis, Missouri 63131, and our telephone number is (314) 692-8200.
4
THE OFFERING
Common Stock Offered........................................ 1,700,000 shares
Common Stock Outstanding After
the Offering....................................... 17,905,277 shares
Use of Proceeds............................................. We will contribute substantially all of the net proceeds of
this offering to the bank to strengthen its capital position,
to support its anticipated loan growth and for other general
corporate purposes. The bank will use a portion of the capital
contributed to temporarily reduce short-term indebtedness,
which may be reborrowed, if necessary, to fund loan growth.
We will use the remaining proceeds that are not contributed to
the bank for general corporate and working capital purposes.
Dividends................................................... Our quarterly dividends for the year ended 2002 totaled $0.26
per share.
Nasdaq National Market symbol............................... ALLE
The number of shares of common stock offered assumes the
underwriters' over-allotment option is not exercised. If the over-allotment
option is exercised in full, we will offer, issue and sell an additional
255,000 shares, and the common stock outstanding after this offering will be
18,160,277 shares.
The number of shares outstanding after this offering set forth
above does not give effect to: (1) 4,873,360 shares reserved for issuance
under our stock option plans, of which options to purchase 1,091,534
shares at a weighted average price of $13.62 were outstanding at March 21,
2003; and (2) approximately 974,150 shares that we will acquire in
connection with the sale of Bank of Ste. Genevieve to First Banks, Inc. if
the proposed disposition is consummated.
5
FINANCIAL SUMMARY
The following table sets forth certain historical financial data of
Allegiant and its subsidiaries on a consolidated basis. This table should be
read in conjunction with our historical consolidated financial statements
and related notes incorporated by reference in this prospectus.
AS OF OR FOR THE YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
2002 2001 2000 1999 1998
---- ---- ---- ---- ----
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
CONDENSED STATEMENT OF INCOME
Interest income ......................... $ 123,205 $ 96,423 $ 71,973 $ 52,112 $ 49,218
Interest expense ........................ 58,307 55,481 40,521 26,601 27,267
----------- ----------- ---------- ---------- ----------
Net interest income .................. 64,898 40,942 31,452 25,511 21,951
Provision for loan losses ............... 8,599 5,000 3,500 2,546 2,420
Other non-interest income ............... 23,321 14,803 6,462 4,843 9,324
Other non-interest expense .............. 47,671 30,070 22,582 18,762 21,295
----------- ----------- ---------- ---------- ----------
Income before income taxes ........... 31,949 20,675 11,832 9,046 7,560
Provision for income taxes .............. 10,552 7,553 4,797 3,644 3,026
----------- ----------- ---------- ---------- ----------
Net income ........................... $ 21,397 $ 13,122 $ 7,035 $ 5,402 $ 4,534
=========== =========== ========== ========== ==========
PER SHARE DATA
Basic earnings per share (1) ............ $ 1.36 $ 1.26 $ 1.09 $ 0.84 $ 0.72
Diluted earnings per share (1) .......... 1.33 1.24 1.08 0.83 0.68
Dividends declared ...................... 0.26 0.24 0.22 0.20 0.12
Book value at period end ................ 10.36 9.08 8.75 7.73 7.36
Weighted average basic shares
outstanding .......................... 15,767,619 10,447,845 6,460,250 6,450,639 6,250,910
BALANCE SHEET
Total assets ............................ $ 2,404,316 $ 2,170,479 $1,135,724 $ 728,492 $ 596,274
Investment securities ................... 455,082 463,637 134,296 60,797 54,780
Loans ................................... 1,702,909 1,419,796 813,971 615,191 495,669
Deposits ................................ 1,768,032 1,687,615 858,084 548,466 450,766
Borrowed funds .......................... 399,735 269,218 174,951 112,221 93,817
Guaranteed preferred beneficial
interest in subordinated
debentures ........................... 57,250 57,250 17,250 17,250 --
Shareholders' equity .................... 167,242 138,068 77,806 47,991 48,104
Allowance for loan losses ............... 19,567 18,905 11,433 8,315 6,442
SELECTED RATIOS
Performance Ratios:
Return on average assets ............. 0.96% 0.94% 0.83% 0.83% 0.73%
Return on average equity ............. 13.88 13.59 13.21 10.60 10.14
Net interest rate margin ............. 3.19 3.17 3.99 4.17 3.82
Efficiency ratio ..................... 54.04 53.94 59.56 61.81 68.07
Total loans to total assets .......... 70.83 65.41 71.67 84.45 83.13
Asset Quality Ratios:
Nonperforming loans to total loans ... 0.92% 1.39% 0.38% 0.10% 0.36%
Nonperforming assets to total assets.. 0.68 0.93 0.29 0.14 0.30
Allowance for loan losses to total
loans .............................. 1.15 1.33 1.40 1.35 1.30
Allowance for loan losses to
nonperforming assets ............... 120.41 94.15 344.99 807.28 362.32
Allowance for loan losses to
nonperforming loans ................ 125.12 95.92 366.09 1,324.20 362.32
Net charge-offs to average loans ..... 0.51 0.48 0.19 0.12 0.25
Allegiant Bancorp Capital Ratios:
Total risk-based capital ............. 9.97 10.01 10.79 10.23 8.68
Tier 1 risk-based capital ............ 8.75 8.11 9.53 8.80 7.42
Tier 1 leverage capital .............. 7.07 6.32 8.71 7.47 5.83
Equity to assets ratio ............... 6.96 6.36 6.85 6.59 8.07
Tangible equity to tangible assets ... 4.66 3.86 5.95 5.06 6.07
-----------
(1) Based on weighted-average common shares outstanding.
6
AS OF OR FOR THE YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
2002 2001 2000 1999 1998
---- ---- ---- ---- ----
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
Allegiant Bank Capital Ratios:
Total risk-based capital.............. 10.63 10.48 11.65 11.52 10.93
Tier 1 risk-based capital............. 9.56 9.26 10.40 10.27 9.68
Tier 1 leverage capital............... 7.78 7.62 9.50 8.89 7.61
OTHER DATA
Number of St. Louis metropolitan area
branches at period period end (1)..... 37 37 23 15 13
-----------
(1) Excludes two branches which we acquired in September 2001, that are to
be sold in connection with the anticipated sale of Bank of Ste.
Genevieve to First Banks, Inc.
All share and per share amounts included above have been restated
to reflect (1) a five-for-four stock split effected in January 1998 and
(2) a six-for-five stock split effected in January 1999.
Our efficiency ratio is the quotient of our other non-interest
expense over the sum of our net interest income and other non-interest
income.
7
RISK FACTORS
You should carefully consider the following risk factors before
purchasing the shares offered by this prospectus. There could be other
factors not listed below that may affect us.
OUR ALLOWANCE FOR LOAN LOSSES MAY NOT BE ADEQUATE TO COVER ACTUAL LOAN
LOSSES, WHICH MAY REDUCE OUR NET INCOME.
Our loan customers may not repay their loans according to their
terms, and the customers' collateral securing the payment of their loans may
be insufficient to assure repayment. Credit losses are inherent in the
lending business and could harm our operating results.
We make various assumptions and judgments about the collectibility
of our loan portfolio and provide an allowance for potential losses based on
a number of factors. If our assumptions are wrong, our allowance for loan
losses may not be sufficient to cover our loan losses. We may have to
increase the allowance in the future. Additions to our allowance for loan
losses would decrease our net income.
OUR EXPOSURE TO CREDIT RISK AND LOAN LOSSES IS INCREASED BECAUSE WE FOCUS ON
COMMERCIAL REAL ESTATE, COMMERCIAL BUSINESS AND CONSTRUCTION LENDING, WHICH
COULD ADVERSELY AFFECT OUR EARNINGS AND FINANCIAL CONDITION.
Commercial real estate, commercial business and construction
lending generally involve a higher degree of credit risk than single-family
residential lending. These loans involve larger loan balances to a single
borrower or groups of related borrowers. These loans are also more
susceptible to a risk of loss during a downturn in the business cycle. The
underwriting, review and monitoring performed by our officers and directors
cannot eliminate all of the risks related to these loans.
Commercial real estate loans are dependent, in large part, on
sufficient income from the property securing the loan to cover operating
expenses and loan payments. In addition, many commercial real estate loans
are not fully amortized over the loan period, but have balloon payments due
at maturity. A borrower's ability to make a balloon payment typically will
depend on being able to either refinance the loan or timely sell the
underlying property.
Our commercial business loans are typically based on the borrower's
ability to repay the loan from the cash flow of the business. A business's
cash flow depends substantially on the success of the business itself. In
addition, the collateral securing the loans may depreciate over time, be
difficult to appraise and fluctuate in value based on the success of the
business.
Risk of loss on a construction loan depends largely upon whether we
properly estimate construction costs and a property's value at completion of
construction. If the estimate of value is inaccurate, the value of the
property securing our loans may be insufficient to ensure full repayment
when completed through sale, a permanent loan or seizure of collateral.
ADVERSE CHANGES IN THE ECONOMIC CONDITIONS OF THE ST. LOUIS MARKET COULD
RESULT IN GREATER LOAN DEFAULTS AND DEVALUATION OF OUR COLLATERAL.
Our success depends to a great extent upon the general economic
conditions of the St. Louis metropolitan area. Unlike larger banks that are
more geographically diversified, we primarily provide banking and financial
services to customers in the St. Louis metropolitan area. In particular, the
ability of the borrowers to repay and the value of collateral securing our
commercial real estate, commercial business and construction loans, may be
impacted by local economic conditions. Favorable economic conditions may not
always exist in our market.
DIFFICULTIES IN MANAGING OPERATING RISKS RESULTING FROM OUR GROWTH MAY
ADVERSELY AFFECT OUR EARNINGS AND FINANCIAL CONDITION.
We have developed risk management policies and procedures to
monitor and manage operating risks in connection with our growth. Our risk
management methods may not be effective because we
8
may have failed to properly identify our operating risks and because certain
of the risks that we will face in the future may be different in nature or
magnitude than those we have faced in the past.
FUTURE GROWTH THROUGH ACQUISITIONS MAY SUBJECT US TO SPECIAL RISKS WHICH MAY
NEGATIVELY IMPACT OUR EARNINGS AND OUR FINANCIAL CONDITION.
Integrating acquired businesses poses operating risks such as:
o diversion of our management's time and attention;
o impairment of relationships with, and the loss of, key
employees and customers; and
o incurrence of unexpected expenses from integrating previously
disparate operations and personnel.
In addition to operating risks, acquiring other financial
institutions or other businesses involves risks commonly associated with
acquisitions, including:
o exposure to unknown or contingent liabilities of an acquired
financial institution or business;
o potential asset quality issues of an acquired financial
institution or business;
o increases in leverage and decreases in liquidity if we borrow
to finance an acquisition or to maintain an appropriate level
of regulatory capital; and
o dilution to our shareholders if we use our common stock as
consideration for the acquisition.
IT MAY BE DIFFICULT FOR US TO MAINTAIN OUR HISTORICAL GROWTH RATE, WHICH MAY
ADVERSELY IMPACT OUR RESULTS OF OPERATIONS.
We have completed various acquisitions and opened additional
branches in the past few years that have significantly enhanced our rate of
growth. We may not continue to sustain this rate of growth or grow at all.
Competition for suitable acquisition candidates is intense. We may target
acquisition candidates that a variety of larger financial institutions with
substantially greater resources than us also may be interested in acquiring,
which may make it more difficult or expensive for us to acquire potential
candidates.
THE LOSS OF CERTAIN KEY PERSONNEL COULD ADVERSELY AFFECT OUR OPERATIONS.
Our success depends in large part on retaining the services of a
limited number of our key management, lending and other banking personnel.
We will likely undergo a difficult transition period if we lose the services
of any of these individuals.
Our success also depends on the experience of the managers of our
branches and our lending officers and on their relationships with the the
communities and the customers they serve. The loss of these key persons
could negatively impact the affected banking operations. We may not be able
to retain our current key personnel or attract additional qualified key
persons as needed.
CHANGES IN INTEREST RATES COULD ADVERSELY AFFECT OUR EARNINGS; AT PRESENT,
WE EXPECT THAT OUR ASSETS WOULD REPRICE FASTER THAN OUR LIABILITIES IN A
DECLINING INTEREST RATE ENVIRONMENT, RESULTING IN A DECREASE IN OUR NET
INTEREST INCOME IF MARKET INTEREST RATES DECLINE.
Like other financial institutions, net interest income will affect
our results of operations. Net interest income is the difference between
interest earned on loans and investments and interest expense incurred on
deposits and other borrowings. Our net interest income will be impacted by
changes in market rates of interest, the interest rate sensitivity of our
assets and liabilities, prepayments on our loans and investments and limits
on increases in the rates of interest charged on our residential real estate
loans.
Certain of our assets and liabilities may react in different
degrees to changes in market interest rates. In addition, interest rates on
some types of assets and liabilities may fluctuate prior to changes in
9
broader market interest rates, while rates on other types may lag behind. We
continually take measures intended to manage the risks from changes in market
interest rates, including using derivatives and other interest-sensitive
instruments to manage our interest rate risk. These investments may not
perform as we anticipate and may not reduce interest rate exposure in the
manner or with the precision we intended. In addition, our position is
slightly asset-sensitive and, therefore, in a declining interest rate
environment, our net interest income will decrease because our assets will
reprice faster than our liabilities.
CHANGES IN INTEREST RATES ARE NOT PREDICTABLE AND MAY ADVERSELY AFFECT OUR
EARNINGS.
We will not be able to predict or control changes in interest
rates. Market interest rates are affected by regional and local economic
conditions, as well as monetary policies of the Board of Governors of the
Federal Reserve. The following factors also may affect market interest
rates:
o inflation or deflation;
o slow or stagnant economic growth or recession;
o unemployment;
o money supply;
o international disorders;
o instability in domestic and foreign financial markets; and
o other factors beyond our control.
Market interest rates will impact the amounts earned on our assets such as
loans and securities and the amounts paid on our liabilities such as
deposits and borrowings.
OWNERSHIP OF OUR COMMON STOCK BY INSIDERS LIMITS THE ABILITY OF OTHER
SHAREHOLDERS TO EXERT CONTROL OVER OUR ORGANIZATION.
Currently, our directors and executive officers own approximately
24% of our outstanding common stock. Upon the completion of this offering
and the consummation of the proposed sale of Bank of Ste. Genevieve to
First Banks, Inc., our directors and officers would own approximately 23%
of our outstanding common stock. As a result, these insiders will effectively
control the election of our Board of Directors and thus our direction and
future operations. Our other shareholders may therefore lack an effective
vote with respect to these matters.
WE CONTINUALLY ENCOUNTER TECHNOLOGICAL CHANGE, AND WE MAY HAVE FEWER
RESOURCES THAN MANY OF OUR COMPETITORS TO CONTINUE TO INVEST IN
TECHNOLOGICAL IMPROVEMENTS, WHICH COULD REDUCE OUR ABILITY TO EFFECTIVELY
COMPETE.
The financial services industry is undergoing rapid technological
changes with frequent introduction of new technology-driven products and
services. In addition to better serving customers, the effective use of
technology increases efficiency and enables financial institutions to reduce
costs. Our future success will depend, in part, upon our ability to address
the needs of our customers by using technology to provide products and
services to enhance customer convenience, as well as to create additional
efficiencies in our operations. Many of our competitors have substantially
greater resources to invest in technological improvements. We cannot assure
you that we will be able to effectively implement new technology-driven
products and services, which could reduce our ability to effectively
compete.
COMPETITION FROM OTHER FINANCIAL INSTITUTIONS WHICH HAVE GREATER RESOURCES
OR WHICH ARE SUBJECT TO LESS REGULATION THAN US MAY ADVERSELY AFFECT OUR
PROFITABILITY.
We operate in a competitive environment. In the St. Louis
metropolitan area, other commercial banks, savings and loan associations,
credit unions, finance companies, mutual funds, insurance
10
companies, brokerage and investment banking firms, investment advisers,
financial planners and other financial intermediaries offer similar services.
Many of these competitors have substantially greater resources and lending
limits and may offer certain services that we do not currently provide. In
addition, the extensive regulations that govern us and our banks may not apply
to some of our non-bank competitors. Our profitability depends upon the
ability of Allegiant Bank to compete in our market area.
WE ARE SUBJECT TO EXTENSIVE AND CONSTANTLY CHANGING REGULATION WHICH
SIGNIFICANTLY AFFECTS OUR BUSINESS.
The banking industry is heavily regulated under both federal and
state law. These regulations are primarily intended to protect depositors
and the Federal Deposit Insurance Corporation, not creditors or
shareholders. We and our non-bank subsidiaries also are subject to the
supervision of the Federal Reserve Board, in addition to other regulatory
organizations. Regulations affecting banks and financial services companies
undergo continuous change, and the ultimate effect of such changes cannot be
predicted. Federal and state governments may modify regulations and laws at
any time, and may enact new legislation. In addition to laws and regulations
affecting our banking business, compliance with other laws, including the
corporate governance standards set forth in the recently enacted
Sarbanes-Oxley Act of 2002, regulatory requirements and Nasdaq National
Market standards impose administrative costs and burdens on us.
TERRORIST ATTACKS AND THREATS, ESCALATION OF MILITARY ACTIVITY IN RESPONSE
TO SUCH ATTACKS OR ACTS OF WAR MAY NEGATIVELY AFFECT OUR EARNINGS AND
FINANCIAL CONDITION.
Our business is affected by general economic conditions,
fluctuations in consumer confidence and spending, and market liquidity,
which can decline as a result of numerous factors outside of our control,
such as terrorist attacks and acts of war. The deterioration of the domestic
economy could cause an increase in delinquencies in our loan portfolio and
loan losses. Future terrorist attacks, like the 2001 attacks in the United
States, as well as events occurring in response to, or in connection with,
the attacks, including rumors or threats of war, actual conflicts involving
the United States or its allies, or military disruptions could materially
adversely affect our business, financial condition and results of operations.
MANAGEMENT HAS DISCRETIONARY USE OF THE PROCEEDS OF THIS OFFERING.
We will contribute substantially all of the net proceeds of this
offering to the bank to strengthen its capital position, to support its
anticipated loan growth and for other general corporate purposes. The bank
will use a portion of the capital contributed to temporarily reduce
short-term indebtedness, which may be reborrowed, if necessary, to fund loan
growth. We will use the remaining proceeds that are not contributed to the
bank for general corporate and working capital purposes. Accordingly, our
management will have broad discretion over how to utilize the majority of
the net proceeds of this offering. You will be relying on the judgment of
our management regarding application of these proceeds.
THERE IS A LIMITED TRADING MARKET FOR OUR COMMON STOCK AND YOU MAY NOT BE
ABLE TO RESELL YOUR SHARES AT OR ABOVE THE PRICE YOU PAY FOR THEM.
The price of our common stock that you purchase in this offering
may decrease significantly. Our common stock is quoted on the Nasdaq
National Market under the symbol "ALLE." A public trading market having the
desired characteristics of liquidity and order depends on the presence in
the market of willing buyers and sellers at any given time. While each of
the underwriters is currently a market maker in our common stock on the
Nasdaq National Market, none of them is obligated to remain a market maker.
The presence of willing buyers and sellers depends on the individual
decisions of investors and general economic conditions, all of which are
beyond our control.
11
FUTURE SALES OF SHARES OF OUR COMMON STOCK IN THE PUBLIC MARKET, OR THE
PERCEPTION THAT SUCH SALES MAY OCCUR, MAY DEPRESS OUR STOCK PRICE.
If our existing shareholders sell our common stock in the public
market following this offering, or if there is a perception that these sales
may occur, the market price of our common stock could decline. Following
completion of this offering, our directors and executive officers will own
approximately 3.8 million shares of common stock (not including shares
issuable upon the exercise of options or restricted securities) that are
tradable in the public market, subject to limited restrictions imposed by
federal securities laws, beginning 180 days after this offering. In addition,
our Board of Directors has the authority to issue up to 20% more shares of our
authorized but unissued common stock without the vote of our shareholders.
Additional issuances of our common stock would dilute the percentage ownership
of existing shareholders and may dilute the per share book value of our common
stock.
ANTI-TAKEOVER PROVISIONS MAY DELAY OR PREVENT AN ACQUISITION BY A THIRD
PARTY.
Provisions in our Restated Articles of Incorporation and Bylaws and
the corporate laws of the State of Missouri may discourage potential
acquisition proposals and could delay or prevent a change in control. These
provisions include a staggered board, a supermajority voting requirement for
certain mergers and asset sales and the right of our Board of Directors to
consider the interests of non-shareholder constituencies in connection with
acquisition proposals. Furthermore, federal banking laws and regulations
require the Federal Reserve Board's approval prior to acquisition of
"control" of a bank holding company. These provisions, laws and regulations
could delay or prevent a transaction that might otherwise result in a
premium over then-current market prices for holders of our shares, and may
limit the ability of our shareholders to approve transactions that they may
deem to be in their best interests.
OUR ABILITY TO PAY DIVIDENDS ON OUR COMMON STOCK IS LIMITED.
Our ability to pay dividends on our common stock largely depends on
our receipt of dividends from our bank. The amount of dividends that our
bank may pay to us is limited by federal and state banking laws and
regulations which require the bank to satisfy certain capitalization
requirements. Moreover, we may decide to limit the payment of dividends even
when we have the legal ability to pay dividends in order to retain earnings
for use in our business. In addition, if interest payments required in
connection with trust preferred securities issued by two of our subsidiaries
are not made or suspended or if we fail to comply with certain covenants
under our term loan agreement, we are contractually prohibited from paying
dividends on our common stock.
12
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements. We have based
these forward-looking statements on our current expectations and projections
about future events. These forward-looking statements are subject to risks,
uncertainties and assumptions, including, among other things:
o the results of our efforts to implement our business strategy,
including Project 2004;
o adverse changes in the bank's loan portfolio and the resulting
credit risk-related losses and expenses;
o our ability to manage our growth, including the successful
expansion of the customer support, administrative
infrastructure and internal management systems necessary to
manage that growth;
o our ability to attract core deposits;
o adverse changes in the economy of our market area that could
increase credit-related losses and expenses;
o adverse changes in real estate market conditions that could
negatively affect credit risk;
o the consequences of continued bank acquisitions and mergers in
our market area, resulting in fewer but much larger and
financially stronger competitors, which could increase
competition for financial services to our detriment;
o fluctuations in interest rates and market prices, which could
negatively affect net interest margins, asset valuations and
expense expectations;
o changes in regulatory requirements of federal and state
agencies applicable to bank holding companies and our present
and future bank subsidiaries;
o changes in accounting principles;
o general economic conditions;
o our ability to complete the disposition of Bank of Ste. Genevieve
to First Banks, Inc. on the terms that we expect, including
without limitation, any adjustment to purchase price based on
the net equity of Bank of Ste. Genevieve on the date of
disposition;
o other factors discussed in the "Risk Factors" section of this
prospectus; and
o other risks and uncertainties detailed from time to time in our
filings with the Securities and Exchange Commission.
We undertake no obligation to publicly update or otherwise revise
any forward-looking statements, whether as a result of new information,
future events or otherwise. In light of these risks, uncertainties and
assumptions, the events discussed in any forward-looking statements in this
prospectus might not occur.
13
USE OF PROCEEDS
We estimate that the net proceeds to us from the sale of the
1,700,000 shares of our common stock will be approximately $26.2 million
($30.2 million if the underwriters' over-allotment option is exercised in
full). Our estimate is based upon an assumed offering price of $16.60 per
share (the closing sale price of our common stock on March 26, 2003),
after deducting the underwriting discounts and estimated offering expenses
of $325,000.
We will contribute substantially all of the net proceeds of this
offering to the bank to strengthen its capital position, to support its
anticipated loan growth and for other general corporate purposes. The bank
will use a portion of the contributed capital to temporarily reduce
short-term indebtedness, including the borrowings currently outstanding
under a credit facility with the Federal Home Loan Bank, which may be
reborrowed, if necessary, to fund loan growth. The borrowings to be repaid
accrue interest at a weighted average rate of 6.1% per annum and have a
weighted average maturity of approximately seven months. The bank also may use
a portion of the net proceeds to open new branches or acquire businesses or
branch locations in the future. However, we have no present understandings
or agreements or definitive plans relating to any specific acquisitions. We
intend to use any remaining proceeds not contributed to the bank for general
and working capital purposes.
We have not yet determined the amount of net proceeds to be used
specifically for each of the foregoing purposes. Accordingly, our management
will have significant flexibility in applying the net proceeds from this
offering. Pending their use as described above, we may invest the net
proceeds from this offering in bank-qualified investments.
MARKET FOR COMMON STOCK AND DIVIDENDS
Our common stock is listed for quotation on the Nasdaq National
Market under the symbol "ALLE." As of March 21, 2003, there were 1,697
shareholders of record of our common stock.
Set forth below are the high and low last sale prices for our
common stock (as reported by the Nasdaq National Market) for each quarter of
2001, 2002 and 2003 (through March 26, 2003) as well as the amount of
cash dividends per share we declared in each quarter.
HIGH LOW DIVIDEND
---- --- --------
YEAR ENDED DECEMBER 31, 2001
First Quarter.............................................. $11.31 $ 8.88 $0.060
Second Quarter............................................. 12.73 9.60 0.060
Third Quarter.............................................. 14.99 10.53 0.060
Fourth Quarter............................................. 13.81 11.40 0.060
YEAR ENDED DECEMBER 31, 2002
First Quarter.............................................. $17.50 $13.45 $0.065
Second Quarter............................................. 19.00 15.72 0.065
Third Quarter.............................................. 18.80 15.02 0.065
Fourth Quarter............................................. 18.24 15.99 0.065
YEAR ENDING DECEMBER 31, 2003
First Quarter (through March 26, 2003) .................... $18.34 $16.59 $0.070
14
On March 26, 2003, the closing sale price for our common stock,
as reported on the Nasdaq National Market, was $16.60 per share.
In 2001, we declared four quarterly cash dividends on our common
stock of $0.060 per share, for an aggregate amount of approximately $2.1
million. In 2002, we declared four quarterly cash dividends on our common
stock of $0.065 per share, for an aggregate amount of approximately $4.0
million. We have declared a dividend of $0.070 per share for the first
quarter of 2003 that is payable on April 15, 2003 to our shareholders of
record as of April 1, 2003. We generally declare and pay cash dividends
quarterly. Because substantially all of the funds available for the payment
of cash dividends are derived from the bank, future cash dividends will
depend primarily upon the bank's earnings, financial condition and need for
funds, as well as government policies and regulations applicable to the bank
and us. As of December 31, 2002, the net profits of the bank available for
distribution to us as dividends without regulatory approval were
approximately $70.6 million. If required payments on outstanding trust
preferred securities issued by two of our subsidiaries are not made or
suspended or if we fail to comply with certain covenants under our term
loan agreement, we will be prohibited from paying dividends on our common
stock.
15
CAPITALIZATION
The following tables set forth our unaudited consolidated
capitalization and regulatory capital ratios (1) at December 31, 2002, (2)
on a pro forma basis to reflect the sale of our wholly-owned banking
subsidiary, Bank of Ste. Genevieve, to First Banks, Inc. in exchange for
974,150 shares of our common stock currently held by First Banks, Inc. as if
the proposed transaction was completed as of December 31, 2002, and (3) on
a pro forma basis to reflect the sale of Bank of Ste. Genevieve to First
Banks, Inc. as if the proposed transaction was completed as of December 31,
2002 and on an as adjusted basis to reflect the sale of 1,700,000 shares of
common stock offered by us pursuant to this prospectus at an assumed public
offering price of $16.60 per share and the application of the estimated net
proceeds from the sale. This information should be read in conjunction with
our consolidated financial statements and notes thereto incorporated by
reference in this prospectus.
DECEMBER 31, 2002
------------------------------------------------
PRO FORMA
ACTUAL PRO FORMA(1) AS ADJUSTED
-------- ------------ -----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
INDEBTEDNESS
Bank borrowings................................................ $ 35,000 $ 35,000 $ 35,000
Other short-term borrowings.................................... 59,882 59,882 59,882
Federal Home Loan Bank advances................................ 304,853 303,239 303,239
Guaranteed preferred beneficial interest in
subordinated debentures..................................... 57,250 57,250 57,250
-------- -------- --------
Total indebtedness.......................................... $456,985 $455,371 $455,371
======== ======== ========
SHAREHOLDERS' EQUITY
Common stock, $0.01 par value; 30,000,000 shares authorized;
16,146,804 shares outstanding actual; 15,172,654 shares
pro forma; 16,872,654 shares pro forma as adjusted (2)...... $ 161 $ 152 $ 169
Capital surplus................................................ 119,933 119,640 145,824
Retained earnings.............................................. 44,614 45,132 45,132
Treasury stock, at cost; no shares outstanding actual; 974,150
shares pro forma and pro forma as adjusted.................. -- (17,749) (17,749)
Accumulated other comprehensive income......................... 2,534 2,167 2,167
-------- -------- --------
Total shareholders' equity.................................. 167,242 149,342 175,544
-------- -------- --------
Total capitalization........................................... $224,492 $206,592 $232,794
======== ======== ========
Book value per share........................................... $ 10.36 $ 10.01 $ 10.57
Tangible book value per share (3).............................. $ 6.76 $ 6.37 $ 7.30
DECEMBER 31, 2002
"WELL- -----------------------------------------------------------------
CAPITALIZED" PRO FORMA
STANDARD(4) ACTUAL PRO FORMA AS ADJUSTED
--------------------- -------------------- -------------------- --------------------
ALLEGIANT ALLEGIANT ALLEGIANT ALLEGIANT ALLEGIANT ALLEGIANT ALLEGIANT ALLEGIANT
BANK BANCORP BANK BANCORP BANK BANCORP BANK BANCORP
--------- --------- --------- --------- --------- --------- --------- ---------
CAPITAL RATIOS
Total risk-based capital ratio 10.00% N/A 10.63% 9.97% 10.63% 9.47% 11.85% 10.83%
Tier 1 risk-based capital ratio 6.00 N/A 9.56 8.75 9.56 8.26 10.79 9.62
Tier 1 leverage capital ratio 5.00 N/A 7.78 7.07 7.78 6.76 8.81 7.87
(1) Pro forma information reflects the following adjustments in respect of
the assumed sale of Bank of Ste. Genevieve:
o Federal Home Loan Bank advances have been reduced by $1,614 to
reflect elimination of the advances drawn by Bank of Ste. Genevieve;
o Common stock has been reduced by $9 to adjust the par value of
remaining shares outstanding;
o Capital surplus has been: increased by $9 to offset the reduction in
the par value of remaining shares
16
outstanding; increased by $367 to offset the adjustment in
accumulated other comprehensive income due to the elimination of
Bank of Ste. Genevieve; increased by $17,749 to reflect the market
value of the Allegiant shares received in the sale; and decreased by
$18,418 to reflect the elimination of Bank of Ste. Genevieve's
shareholders' equity arising from the sale;
o Retained earnings have been increased by $518 to reflect the closing
cash dividend to Allegiant provided under the sale agreement;
o Treasury stock has been increased $17,749 to reflect the market
value of the Allegiant shares acquired in the sale; and
o Accumulated other comprehensive income has been decreased by $367 to
reflect the elimination of Bank of Ste. Genevieve's accumulated
other comprehensive income arising from the sale.
As a result of the above adjustments, on a pro forma basis Allegiant's
total indebtedness is reduced by $1,614 and its total shareholders'
equity and capitalization are reduced by $17,900.
(2) The number of shares outstanding does not give effect to 4,873,360
shares reserved for issuance under our stock option plans (of which
options to purchase 1,091,536 shares at a weighted average price of
$13.62 were outstanding).
(3) Tangible book value per share equals total assets, less intangible
assets, including goodwill, divided by the number of shares outstanding
or assumed to be outstanding.
(4) Reflects the minimum amount of capital necessary to meet the
"well-capitalized" regulatory standard for banks. As of December 31,
2002, we exceeded the minimum "well-capitalized" standard for all Tier 1
leverage, Tier 1 risk-based capital and total risk-based capital ratios.
Upon completion of this offering, we will meet the "well-capitalized"
standard for all three risk capital measures.
17
MANAGEMENT
The following table sets forth certain information regarding our
directors and executive officers:
NAME AGE POSITION
---- --- --------
Marvin S. Wool.........................74 Chairman of the Board
Shaun R. Hayes.........................43 Director, President and Chief Executive Officer
Robert L. Chambers.....................41 Director
Leland B. Curtis.......................59 Director
Kevin R. Farrell.......................51 Director and Secretary
Richard C. Fellhauer...................61 Director
Leon A. Felman.........................68 Director
Douglas P. Helein......................51 Director
Michael R. Hogan.......................49 Director
C. Virginia Kirkpatrick................69 Director
Nancy C. Pechloff......................50 Director
Thomas M. Teschner.....................46 Director
Robert E. Wallace, Jr..................46 Director
John L. Weiss..........................47 Director
Lee S. Wielansky.......................51 Director
Jeffrey S. Schatz......................45 Executive Vice President and Chief Financial Officer
Paul F. Glarner........................54 Executive Vice President and Chief Lending Officer
Arthur E. Weiss........................43 Senior Vice President, Wealth Management
Thomas A. Daiber.......................45 Executive Vice President
Marvin S. Wool has served as a director since March 1990 and as our
Chairman and Chairman of our bank since March 1992. From March 1992 through
1998, Mr. Wool served as our Chief Executive Officer. For more than the past
five years, Mr. Wool has served as the President and Chief Executive Officer
of Dash Multi-Corp, Inc., the holding company for subsidiary companies
that are in the chemical, cloth coating, carpet and rubber products
industries.
Shaun R. Hayes has served as a director and our President since
1989 and became our Chief Executive Officer in January 1999. Additionally,
Mr. Hayes has served as a director of our bank since 1990, and as President
and Chief Executive Officer of our bank since May 1992.
Robert L. Chambers has served as a director since December 2000.
Mr. Chambers has been President of Huntleigh Securities Corp., a securities
brokerage company, since September 2000. Prior to that time, he was Chief
Executive Officer of K.W. Chambers & Co., a regional, full-service
broker/dealer, for more than five years.
Leland B. Curtis has served as a director since April 1996 and was
a director of our bank from May 2000 to November 2001. Mr. Curtis has been a
partner at Curtis, Oetting, Heinz, Garrett & O'Keefe, P.C., a law firm
located in St. Louis, Missouri, for more than five years.
Kevin R. Farrell has served as a director since June 1989, as our
Secretary since 1994 and as a director of our bank since 1990. Mr. Farrell
has been President of Great Ledge Development, Inc., formerly St. Louis
Steel Products, Inc., a metal forming company, since its founding in 1990.
Richard C. Fellhauer has served as a director since December 2000.
Mr. Fellhauer has been one of the bank's Senior Vice Presidents since
November 2000. Prior to that time, Mr. Fellhauer was the President, Chief
Executive Officer and Chairman of the Board of Equality Bancorp, the holding
company for Equality Savings Bank, from 1982 to November 2000.
Leon A. Felman has served as a director since 1992 and as a
director of our bank since May 2000. Mr. Felman's business activities have
been private investment in financial institutions since 1999. For
18
more than 30 years before that time, he was associated with Sage Systems,
Inc., a franchisee of Arby's restaurants in the St. Louis area, and served
as its President and Chief Executive Officer. Mr. Felman serves on the board
of directors of Dynex, Inc., a Richmond, Virginia-based mortgage real estate
investment trust listed on the New York Stock Exchange.
Douglas P. Helein has served as a director since October 2001. Mr.
Helein has been an insurance broker for Welsch, Flatness & Lutz, Inc., an
insurance agency, for more than the past five years.
Michael R. Hogan has served as a director since October 2000. Mr.
Hogan has been Chief Administrative Officer, Chief Financial Officer and
Vice President of Sigma-Aldrich Corporation, a life science company, since
April 1999. Prior to that time, he served three years as Corporate Vice
President and Controller for Monsanto Company, a St. Louis based
manufacturer of agriculture and biotechnology products and other consumer
products.
C. Virginia Kirkpatrick has served as a director and as a director
of our bank since March 1990. Ms. Kirkpatrick has been President of CVK
Personal Management & Training Specialists, a business consulting and human
resource management firm, since 1982.
Nancy C. Pechloff has served as a director since November 2002. Ms.
Pechloff has been an Adjunct Professor of Accounting at the Olin School of
Business at Washington University in St. Louis since September 2002. Prior
to that time, she was a Senior Audit Partner for 29 years at Arthur
Andersen LLP.
Thomas M. Teschner has served as a director and as a director of
our bank since October 2001. Mr. Teschner has been a private investor since
October 2001. Prior to that time, he was the President and Chief Executive
Officer of Southside Bancshares Corp., the holding company for South Side
National Bank, from 1992 through September 2001.
Robert E. Wallace, Jr. has served as a director since October 2000.
Mr. Wallace has been the Senior Vice President of Administration/General
Counsel of the St. Louis Rams, a professional football team, since 1995.
John L. Weiss has served as a director since March 1999 and as a
director of our bank since May 1997. Mr. Weiss has been President of
Brentwood Volvo, an automobile dealership in St. Louis, Missouri, for more
than 15 years and has been the General Manager of Feld Toyota, an automobile
dealership located in St. Louis, since February 2000.
Lee S. Wielansky has served as a director since 1990, was a
director of our bank from January 1999 to November 2001 and served as Vice
Chairman of our bank from February 1999 to November 2001. Mr. Wielansky has
been the President and Chief Executive Officer of JDN Development Company
since November 2000 and a member of its board of directors since February
2001. He has been a member of the board of directors of Acadia Realty, a New
York Stock Exchange-listed real estate investment trust, since June 2000.
Prior to that time, he was Managing Director of Investments and a
member of the board of directors of Regency Realty Corporation, a
publicly-held real estate investment trust, for more than three years.
Jeffrey S. Schatz has served as one of our Executive Vice
Presidents and our Chief Financial Officer since February 2003. Prior to
becoming our Chief Financial Officer, Mr. Schatz served as our Chief
Operations Officer since January 2000. Prior to joining us, Mr. Schatz
served as Senior Vice President - Funds Management of Sky Financial Group,
Inc., a Bowling Green, Ohio bank holding company, for more than nine years.
Paul F. Glarner has served as one of our Executive Vice Presidents
and our Chief Lending Officer since 1997. Prior to joining us, Mr. Glarner
served as an officer of Mercantile Bank, now U.S. Bank, for more than five
years.
19
Arthur E. Weiss has served as our Senior Vice President of Wealth
Management since 2000. Prior to joining us, Mr. Weiss served as the
President of The Weiss Group, Inc., an accounting and consulting firm. He
founded the firm in 1991 and sold it to a publicly-traded company in 1998.
From 1982 to 1991 Mr. Weiss was a tax manager with a Big 5 public accounting
firm.
Thomas A. Daiber has served as one of our Executive Vice Presidents
since May 1999. Mr. Daiber served as our Chief Financial Officer from May
1999 until February 2003. Mr. Daiber has announced that, within the next few
months, he intends to resign from his Executive Vice President position and
become Chairman, President and Chief Executive Officer for the State Bank of
Aviston in southwestern Illinois on a full-time basis. Mr. Daiber has been
employed by us since March 1997 and served as our Director of Internal
Auditing prior to becoming our Chief Financial Officer.
20
STOCK OWNERSHIP OF MANAGEMENT AND PRINCIPAL SHAREHOLDERS
The table below sets forth the beneficial ownership of our common
stock as of March 21, 2003, of each person we know to beneficially own 5% or
more of the common stock, each of our directors, the executive officers
named individually in our most recent proxy statement and all of our
directors and executive officers as a group. The number of beneficially
owned shares includes shares over which the named person, directly or
indirectly through any contract, arrangement, understanding, relationship or
otherwise, has or shares (1) voting power, which includes the power to vote,
or direct the voting of, such security; or (2) investment power, which
includes the power to dispose of, or to direct the disposition of, such
security. All shares of a named person are deemed to be subject to that
person's sole voting and investment power unless otherwise indicated. Shares
subject to stock options are included as outstanding shares of common stock,
except if these options are not exercisable within 60 days after March 21,
2003.
NUMBER OF SHARES PERCENT OF
NAME OF BENEFICIAL OWNER BENEFICIALLY OWNED (1) COMMON STOCK
------------------------ ---------------------- ------------
First Banks, Inc. (2).................................................... 1,205,929 7.4%
Robert L. Chambers (3)................................................... 32,945 *
Leland B. Curtis (4)..................................................... 58,860 *
Kevin R. Farrell (5)..................................................... 362,688 2.2
Richard C. Fellhauer (6)................................................. 155,663 1.0
Leon A. Felman (7)....................................................... 1,297,511 7.7
Shaun R. Hayes (8)....................................................... 555,185 3.4
Douglas P. Helein (9).................................................... 310,722 1.9
Michael R. Hogan (10).................................................... 22,500 *
C. Virginia Kirkpatrick (11)............................................. 155,804 1.0
Nancy C. Pechloff (12)................................................... 2,679 *
Thomas M. Teschner (13).................................................. 203,827 1.3
Robert E. Wallace, Jr. (14).............................................. 18,242 *
John L. Weiss (15)....................................................... 38,954 *
Lee S. Wielansky (16).................................................... 153,628 1.0
Marvin S. Wool (17)...................................................... 791,573 4.9
Jeffrey S. Schatz (18)................................................... 38,362 *
Paul F. Glarner (19)..................................................... 60,351 *
Arthur E. Weiss (20)..................................................... 22,935 *
Thomas A. Daiber (21).................................................... 49,504 *
All directors and executive officers as a group (19 persons) (22)........ 4,331,932 25.9%
--------------
* Less than 1%
(1) Except as otherwise indicated, each individual has sole voting and
investment power over the shares listed beside his or her name and is
deemed to own shares issuable upon the exercise of stock options which
were exercisable at March 21, 2003 or which were to become exercisable
within 60 days thereafter. The percentage calculations for beneficial
ownership are based upon 16,205,277 shares of our common stock that
were issued and outstanding as of March 21, 2003, plus, with respect to
each individual and for all directors and executive officers as a
group, the number of shares subject to options that may be acquired
upon exercise within 60 days after March 21, 2003.
(2) First Banks, Inc.'s address is 135 North Meramec, Clayton, Missouri
63105. The number of shares reported beneficially owned by First
Banks, Inc. is based upon information furnished by our transfer agent,
UMB Bank, n.a. In September 2002, we entered into an exchange
agreement that provides for First Banks, Inc. to acquire our
wholly-owned banking subsidiary, Bank of Ste. Genevieve, in exchange
for approximately 974,150 shares of Allegiant common stock that is
currently held by First Banks, Inc. The transaction, which is subject
to regulatory approvals, is expected to be completed in the first half
of 2003. After the transaction is completed, First Banks, Inc. will
own approximately 231,779 shares, or 1.5%, of our outstanding common
stock.
(3) Total includes 17,734 shares subject to stock options exercisable
within 60 days.
(4) Total includes 14,533 shares held jointly with Mr. Curtis's spouse,
13,464 shares held in Mr. Curtis's IRA plan, 5,971 shares held in the
Curtis, Oetting, et. al profit sharing plan, and 24,850 shares subject
to stock options exercisable within 60 days.
(footnotes continued on following page)
21
(5) Total includes 196,509 shares held of record by Pentastar Family
Holdings, Inc., 96,052 shares held of record by Cuttyhunk Investments,
LLC, 1,771 shares held by Fidelity Investments as Trustee for the IRA
of Mr. Farrell's spouse, 1,512 shares held by NFSC/FMTC as Trustee for
the IRA of Mr. Farrell's spouse, 54,011 shares held by Fidelity
Investments in Mr. Farrell's IRA plans, and 9,950 shares subject to
stock options exercisable within 60 days.
(6) Total includes 23,229 shares held jointly with Mr. Fellhauer's spouse,
1,839 shares held by Mr. Fellhauer as custodian for his two children,
3,661 shares held in the IRA account of Mr. Fellhauer's spouse, 77,171
shares held subject to our section 401(k) plan, 23,035 shares held in
Mr. Fellhauer's IRA plan, 383 shares held jointly with Michael Walsh,
and 25,734 shares subject to stock options exercisable within 60 days.
(7) Total includes 62,400 shares held in the Leon A. Felman Family Trust
of which Mr. Felman is the voting trustee, 1,123,600 shares held in
the Felman Family Partnership, LP of which Mr. Felman is the voting
partner, and 5,000 shares subject to stock options exercisable within
60 days. Mr. Felman's address is 2122 Kratky Road, St. Louis, Missouri
63114.
(8) Total includes 5,140 shares held for the benefit of Mr. Hayes's
children as to which he has voting rights, 2 shares held of record by
Mr. Hayes's spouse; 4,425 shares held subject to our section 401(k)
plan, 21,000 shares of restricted stock, and 118,074 shares subject to
stock options exercisable within 60 days.
(9) Total includes 5,000 shares subject to stock options exercisable
within 60 days.
(10) Total includes 12,500 shares subject to stock options exercisable
within 60 days.
(11) Total includes 16,033 shares held jointly with Ms. Kirkpatrick's
spouse, 3,015 shares held of record by Ms. Kirkpatrick's spouse,
25,927 shares held in the IRA of Ms. Kirkpatrick's spouse, 7,118
shares held jointly with Ms. Kirkpatrick's children, 9,950 shares held
in Ms. Kirkpatrick's SEP account, and 14,950 shares subject to stock
options exercisable within 60 days.
(12) All shares are held as tenants by the entirety with Ms. Pechloff's spouse.
(13) Total includes 23,958 shares held jointly with Mr. Teschner's spouse,
and 5,000 shares subject to stock options exercisable within 60 days.
(14) Total includes 5,741 shares held jointly with Mr. Wallace's spouse,
and 12,500 shares subject to stock options exercisable within 60 days.
(15) Total includes 3,256 shares held in the IRA account of Mr. Weiss's
spouse, 723 shares held jointly with Mr. Weiss's spouse, 750 shares
held jointly with Mr. Weiss's mother, 5,967 shares held in Mr. Weiss's
IRA plan, and 18,094 shares subject to stock options exercisable
within 60 days.
(16) Total includes 24,850 shares subject to stock options exercisable
within 60 days.
(17) Total includes 76,005 shares held by the Dash Multi-Corp. Pension
Plan, 63,636 shares held in trusts for the benefit of Mr. Wool's
children, 11,216 shares held jointly with Mr. Wool's spouse, and
47,845 shares subject to stock options exercisable within 60 days.
(18) Total includes 1,162 shares held subject to our section 401(k) plan,
3,000 shares held jointly with Mr. Schatz's spouse, 12,000 shares of
restricted stock, and 22,200 shares subject to stock options
exercisable within 60 days.
(19) Total includes 4,522 shares held subject to our section 401(k) plan,
111 shares held by Mr. Glarner as custodian for his daughter, 1,074
shares held jointly with Mr. Glarner's spouse, 12,000 shares of
restricted stock, and 39,000 shares subject to stock options
exercisable within 60 days.
(20) Total includes 4,000 shares held jointly with Mr. Weiss's spouse, 1,411
shares held subject to our section 401(k) plan, 524 shares held in Mr.
Weiss's IRA plan, 7,000 shares of restricted stock, and 10,000 shares
subject to stock options exercisable within 60 days.
(21) Total includes 1,299 shares held subject to our section 401(k) plan,
5,250 shares of restricted stock, and 30,500 shares subject to stock
options exercisable within 60 days.
(22) Total includes 62,500 shares of restricted stock, and 444,381 shares
subject to stock options exercisable within 60 days.
22
DESCRIPTION OF CAPITAL STOCK
The following summary description of our capital stock is qualified
in its entirety by reference to our Restated Articles of Incorporation and
Bylaws.
We are authorized to issue 30,000,000 shares of common stock, $0.01
par value per share. As of March 21, 2003, there were 16,205,277 shares of
common stock outstanding and 4,873,360 shares reserved for issuance upon
exercise of outstanding stock options with a weighted average price of
$13.62.
DIVIDEND RIGHTS
The holders of our common stock are entitled to receive dividends
when, as and if declared by our Board of Directors, subject to the rights of
holders of then outstanding shares, if any, having preferences with respect
to dividends. Under Missouri law, we may not authorize and make
distributions if, after giving effect to the distribution,
o we would be unable to meet our debts as they become due in the
usual course of business; or
o our total assets would be less than the sum of (1) our total
liabilities plus, (2) the amount that would be needed, if we
were to be dissolved at the time of distribution, to satisfy
any preferential rights of shareholders upon dissolution
superior to the rights of those shareholders receiving the
distribution.
If we do not make required payments on outstanding trust preferred
securities, or are in violation of certain covenants under our term loan
agreement, we are prohibited from paying dividends on our common stock.
As a bank holding company, our ability to pay distributions will be
affected by the ability of our bank to pay dividends. Our ability, as well
as the ability of the bank, to pay dividends in the future currently is, and
could be further, influenced by bank regulatory requirements and capital
guidelines.
VOTING RIGHTS
Except as described below regarding the election of directors, each
holder of common stock is entitled to one vote per share. The quorum for
shareholders' meetings is a majority of the outstanding shares entitled to
vote represented in person or by proxy.
PROVISIONS REGARDING CERTAIN BUSINESS COMBINATIONS
Our Restated Articles of Incorporation require the affirmative vote
of the holders of at least 80% of the outstanding shares of our capital
stock to approve a merger and certain other business combinations involving
any holder of 5% or more of our common stock and us. However, if 75% or more
of the members of our Board of Directors approve the transaction, the
supermajority shareholder vote is not required.
As of March 21, 2003, our directors and executive officers own
approximately 24% of our outstanding common stock. Upon the completion of
this offering and the consummation of the proposed sale of Bank of Ste.
Genevieve to First Banks, Inc., our directors and officers would own
approximately 23% of our outstanding common stock. As a result, these
insiders will effectively control the election of our Board of Directors and
thus our direction and future operations, and our other shareholders may
lack an effective vote with respect to these matters. Consequently, the
directors and executive officers possess sufficient voting power to
significantly affect the vote on, and perhaps prevent, certain mergers and
other business combinations.
ELECTION, CLASSIFICATION AND REMOVAL OF DIRECTORS
Our Restated Articles of Incorporation provide for a classified
Board of Directors, with approximately one-third of the entire Board of
Directors being elected each year and with directors
23
serving for terms of three years. Directors are elected by a plurality of
votes cast. Holders of common stock have the right to cumulate their votes
in the election of directors. Our Restated Articles of Incorporation provide
that any director, or the entire Board of Directors, may be removed at any
time by our shareholders, without cause, by the affirmative vote of the
holders of at least 80% of the shares entitled to vote for the election of
directors, and may be removed for cause by an affirmative vote of a majority
of the shares entitled to vote.
SHAREHOLDER APPROVAL OF TRANSACTIONS
An affirmative vote of at least 80% of the shares of our common
stock is required to amend the provisions of our Restated Articles of
Incorporation relating to the removal of a director or the approval
requirement for a merger or business combination with a holder of 5% or more
of our common stock. In addition, under Missouri law an affirmative vote of
at least two-thirds of the shares of our common stock is required to approve
a merger or sale of substantially all of our assets. Except for the
foregoing, any other proposal voted on by the shareholders will be approved
if the majority of the votes cast at the shareholders' meeting (at which a
quorum is present) called for the purpose of considering any such action are
cast in favor of the proposal.
LIQUIDATION RIGHTS
In the event of our liquidation, dissolution or winding up, holders
of our common stock are entitled to receive equally and pro-rata per share
any assets distributable to shareholders, after payment of debts and
liabilities.
OTHER MATTERS
Holders of our common stock do not have preemptive rights or
conversion rights with respect to our common stock. Except in connection
with certain business combinations and except as noted below, we can issue
new shares of authorized but unissued common stock without shareholder
approval. The bylaws of The Nasdaq Stock Market, Inc. governing the Nasdaq
National Market, on which our common stock is quoted, require issuers to
obtain shareholder approval for the issuance of securities in connection
with the acquisition of a business, company, assets, property or securities
representing such interests where the present or potential issuance of
common stock or securities convertible into common stock in connection with
such acquisition could result in an increase of 20% or more in the
outstanding shares of common stock. Accordingly, the future issuance of
common stock may require shareholder approval under those rules.
CERTAIN STATUTORY PROVISIONS
We are subject to the business combination provisions under
Missouri law, which allow our Board of Directors to retain discretion over
the approval of certain business combinations. We are also subject to the
control shares acquisition provision under Missouri law, which places
restrictions on the voting rights of an acquiror with respect to any shares
of voting stock which increase its equity ownership to more than specified
thresholds unless certain conditions are satisfied. Missouri law also
permits our Board of Directors to consider the interests of non-shareholder
constituencies in connection with acquisition proposals. These provisions
may make it more difficult for there to be a change in control of us or
for us to enter into certain business combinations than if we were not
subject to these provisions.
TRANSFER AGENT
UMB Bank, n.a., Kansas City, Missouri serves as the transfer agent
of our issued and outstanding common stock.
24
UNDERWRITING
Subject to the terms and conditions of an underwriting agreement,
the underwriters named below, for whom Legg Mason Wood Walker, Incorporated
is acting as representative, have severally agreed to purchase from us, and
we have agreed to sell to them, an aggregate of 1,700,000 shares of common
stock in the amounts set forth opposite each underwriter's name below:
NUMBER OF
UNDERWRITERS SHARES
------------ ---------
Legg Mason Wood Walker, Incorporated...................
RBC Dain Rauscher Inc..................................
Stifel, Nicolaus & Company, Incorporated...............
Howe Barnes Investments, Inc...........................
---------
Total......................................... 1,700,000
=========
The underwriting agreement provides that the obligations of the
underwriters are subject to various conditions contained in the underwriting
agreement. If an underwriter defaults, the underwriting agreement provides
that the purchase commitments of the non-defaulting underwriters may be
increased or, in certain cases, that the underwriting agreement may be
terminated. The nature of the underwriters' obligation is such that they are
committed to purchase and pay for all of the shares of common stock (other
than those covered by the over-allotment option discussed below) if any are
purchased.
We have granted the underwriters an option to purchase up to
255,000 additional shares of common stock at the same price per share to be
paid by the underwriters for the other shares of common stock being offered.
This option is exercisable from time to time for 30 days after the date of
this prospectus, but may be exercised by the underwriters only to cover any
over-allotments. If the underwriters elect to purchase any of the shares of
common stock under this option, each underwriter will be committed to
purchase the additional shares of common stock in approximately the same
proportion allocated to them in the table above.
At our request, the underwriters have reserved up to 100,000 shares
of our common stock offered by this prospectus for sale to our directors and
officers at the public offering price set forth on the cover page of this
prospectus. These persons must commit to purchase no later than the close of
business on the day following the date of this prospectus. The number of
shares available for sale to the general public will be reduced to the
extent these persons purchase the reserved shares. We are not making loans
to these executive officers or directors to purchase such shares.
We have agreed that, without the prior consent of the underwriters,
we will not directly or indirectly offer, sell or otherwise dispose of any
shares of common stock or any securities which may be converted into or
exchanged for common stock for a period of 180 days after the effective date
of the registration statement of which this prospectus is a part, subject to
certain exceptions. All of our executive officers and directors have agreed
that, without the prior written consent of the underwriters, they will not
directly or indirectly offer, sell or otherwise dispose of any shares of
common stock or any securities which may be converted into or exchanged for
common stock for a period ending 180 days after the effective date of the
registration statement of which this prospectus is a part, subject to
certain exceptions.
The following table shows the public offering price, underwriting
discount and proceeds to us before expenses. Certain expenses of the
underwriters that are reimbursable by us are not included in
25
the table. The information assumes either no exercise or full exercise by the
underwriters of their over-allotment option.
PER SHARE WITHOUT OPTION WITH OPTION
--------- -------------- -----------
Public offering price..................... $ $ $
Underwriting discount.....................
Proceeds, before expenses.................
The underwriters will initially offer the shares of common stock to
the public at the price stated on the cover page. The underwriters may offer
shares of common stock to selected dealers at the public offering price less
a concession of up to $ per share. Those dealers may reallow a discount not
in excess of $ per share to other brokers and dealers. After the initial
offering of the shares, the underwriters may change the offering price,
concession, discount and other selling terms.
We estimate that we will spend approximately $325,000 for printing,
depository fees, legal and accounting fees and other expenses of the
offering in addition to the underwriting compensation.
In connection with the offering, the underwriters and their
affiliates may engage in transactions, effected in accordance with the
Securities and Exchange Commission's Regulation M, that are intended to
stabilize, maintain or otherwise affect the market price of the common
stock. These transactions may include over-allotment or other mechanisms
through which the underwriters create a selling syndicate short position by
selling more shares of common stock than the underwriters are committed to
purchase. The underwriters may elect to cover any short position by
purchasing common stock in the open market or by exercising the
over-allotment option. The underwriters also may bid for, and purchase, the
common stock, including at a price above that which might otherwise prevail
in the open market for the purpose of preventing or retarding a decline in
the market price of the common stock. The underwriters may impose penalty
bids under which selling concessions allowed to syndicate members or other
dealers participating in the offering are reclaimed if shares of common
stock previously distributed in the offering are repurchased by the
underwriters. Any of these transactions may maintain or stabilize the price
for the common stock at a level above that which might otherwise prevail in
the open market. None of the underwriters or we make any representation or
prediction as to the direction or magnitude of any effect that the
transactions described above may have on the market price of the common
stock. The underwriters are not required to engage in any of these
transactions and may discontinue them at any time without notice if they
commence them. The underwriters may effect these transactions on the Nasdaq
National Market or elsewhere.
The underwriters and selling group members may also engage in
passive market making transactions in the common stock in accordance with
Rule 103 of Regulation M. In general, a passive market maker may not bid for
or purchase shares of common stock at a price that exceeds the highest
independent bid. In addition, the net daily purchases made by any passive
market maker generally may not exceed 30% of its average daily trading
volume in the common stock or 200 shares, whichever is greater. A passive
market maker's bid size may not exceed the minimum quotation size for the
common stock or the market maker's remaining purchase capacity, whichever is
less. A passive market maker must identify passive market making bids as
such on the Nasdaq electronic inter-dealer reporting system. Passive market
making may stabilize or maintain the market price of the common stock above
independent market levels. Underwriters and dealers are not required to
engage in passive market making and may end passive market making activities
at any time.
We have agreed to indemnify the underwriters against liabilities
arising from the offering of the shares of common stock, including civil
liabilities under the Securities Act of 1933, or to contribute to payments
that the underwriters may be required to make in connection with those
liabilities.
Legg Mason assisted us in evaluating and rendered an opinion to our
Board of Directors as to the fairness, from a financial point of view, to us
of the approximately 974,150 shares of our common stock
26
to be received by us in connection with our proposed disposition of the
shares of Bank of Ste. Genevieve to First Banks, Inc. We have compensated
Legg Mason for advising us and rendering this opinion. Under the rules of
the NASD, Legg Mason's compensation for such services may be considered
by the NASD to be compensation for the sale of common stock offered in this
prospectus even though such compensation is not intended for or contingent
upon the sale of the common stock. In addition, certain of the underwriters
and their affiliates have provided in the past and may provide in the future
investment banking services for us or our affiliates for which they would
expect to receive customary fees and commissions. The underwriters are
currently market makers in our common stock on the Nasdaq National Market.
LEGAL MATTERS
Our attorneys, Thompson Coburn LLP, St. Louis, Missouri, will opine
as to the validity of the common stock offered by us, as well as certain
other legal matters related to the sale of the shares. Certain legal matters
relating to the offering will be passed upon for the underwriters by Barack
Ferrazzano Kirschbaum Perlman & Nagelberg LLC, Chicago, Illinois.
EXPERTS
Our consolidated financial statements as of December 31, 2002 and
2001 and for each of the three years in the period ended December 31, 2002,
incorporated by reference in this prospectus and in the registration
statement, have been audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon incorporated by reference herein and in
the registration statement in reliance upon such report given on the
authority of that firm as experts in accounting and auditing.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934. Accordingly, we file annual, quarterly and special
reports, proxy statements and other information with the Securities and
Exchange Commission. You may read and copy any document we file with the
Securities and Exchange Commission at the public reference facilities
maintained by the Securities and Exchange Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Our filings with the Securities and Exchange
Commission also are available to the public from the Securities and Exchange
Commission's website at http://www.sec.gov. Please call the Securities and
Exchange Commission at 1-800-SEC-0330 for further information. Our common
stock is listed on the Nasdaq National Market. In addition, we maintain a
website at www.allegiantbank.com.
This prospectus is part of a registration statement we filed with
the Securities and Exchange Commission and does not contain all of the
information set forth in the registration statement. You should consult the
registration statement for further information with respect to our company
and these securities.
27
INCORPORATION BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can
disclose important information to you by referring you to those documents.
The information incorporated by reference is considered to be part of this
prospectus, and later information that we file with the Securities and
Exchange Commission will automatically update and supersede this information
and information in this prospectus. We incorporate by reference the
documents listed below and any future filings made with the Securities and
Exchange Commission under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until all of the securities are sold.
o Annual Report on Form 10-K for the year ended December 31, 2002
(Commission File No. 000-10849);
o Portions of our Proxy Statement for our 2003 Annual Meeting of
Shareholders (Commission File No. 000-10849) responsive to
Items 5, 10, 11, 12 and 13 of Form 10-K;
o Portions of Allegiant Bancorp, Inc.'s 2002 Annual Report for
Meeting of Shareholders filed as Exhibit 13 to our Annual
Report on Form 10-K for the year ended December 31, 2002
(Commission File No. 000-10849); and
o The description of our common stock set forth in Item 11 of our
Registration Statement on Form 10-SB (Reg. No. 0-26350), filed
June 30, 1995.
We will provide to each person, including any beneficial owner, to
whom a prospectus is delivered, a copy of any or all of the information that
has been incorporated by reference into the prospectus but not delivered
with the prospectus. You may request a copy of any of these filings, at no
cost, by writing or calling us at the following address: Secretary,
Allegiant Bancorp, Inc., 10401 Clayton Road, St. Louis, Missouri 63131,
telephone (314) 692-8200.
28
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(This page has been left blank intentionally.)
============================================================================
1,700,000 SHARES
[Allegiant Bancorp logo]
COMMON STOCK
---------------
PROSPECTUS
---------------
LEGG MASON WOOD WALKER
INCORPORATED
RBC CAPITAL MARKETS
STIFEL, NICOLAUS & COMPANY
INCORPORATED
HOWE BARNES INVESTMENTS, INC.
, 2003
============================================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the expenses in connection with the
issuance and distribution of the shares offered hereby, all of which will be
paid by the Company (all amounts other than the Securities and Exchange
Commission, NASD and Nasdaq fees are estimated):
SEC registration fee ......................................... $ 3,173
NASD review fee............................................... 3,612
Nasdaq National Market listing fee............................ 17,250
Transfer agent's fees and expenses............................ 10,000
Legal fees and expenses
(other than Blue Sky fees and expenses).................... 125,000
Accounting fees and expenses.................................. 75,000
Printing and engraving expenses............................... 75,000
Blue Sky fees and expenses.................................... 5,000
Miscellaneous................................................. 10,965
--------
Total................................................ $325,000
========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 351.355(1) and (2) of The General and Business Corporation
Law of the State of Missouri provide that a corporation may indemnify 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 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 expenses, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in good faith
and in a manner he 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 conduct was unlawful,
except that, in the case of an action or suit by or in the right of the
corporation, the corporation may not indemnify such persons against
judgments and fines and no person shall be indemnified as to any claim,
issue or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of his duty to the
corporation, unless and only to the extent that the court in which the
action or suit was brought determines upon application that such person is
fairly and reasonably entitled to indemnity for proper expenses. Section
351.355(3) provides that, to the extent that a director, officer, employee
or agent of the corporation has been successful in the defense of any such
action, suit or proceeding or any claim, issue or matter therein, he shall
be indemnified against expenses, including attorneys' fees, actually and
reasonably incurred in connection with such action, suit or proceeding.
Section 351.355(7) provides that a corporation may provide additional
indemnification to any person indemnifiable under subsection (1) or (2),
provided such additional indemnification is authorized by the corporation's
articles of incorporation or an amendment thereto or by a
shareholder-approved bylaw or agreement, and provided further that no person
shall thereby be indemnified against conduct which was finally adjudged to
have been knowingly fraudulent, deliberately dishonest or willful
misconduct.
Article XII of our Bylaws provides that we extend to our directors
and officers the indemnification specified in Sections 351.355(1) and (2)
and the additional indemnification authorized in Section 351.355(7) of The
General and Business Corporation Law.
Pursuant to directors' and officers' liability insurance policies,
with total annual limits of $2.0 million, our directors and officers are
insured, subject to the limits, retention, exceptions and other
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terms and conditions of the policies, against liability for any actual or
alleged error, misstatement, misleading statement, act or omission, or neglect
or breach of duty by our directors or officers, individually or collectively,
or any matter claimed against them solely by reason of their being our
directors or officers.
The underwriting agreement also provides for indemnification by the
underwriters of our officers and directors for certain liabilities under the
Securities Act of 1933.
ITEM 16. EXHIBITS
See Exhibit Index.
ITEM 17. UNDERTAKINGS
(a) 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
Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an Employee Benefit Plan's Annual Report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and this
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(b) The undersigned registrant hereby undertakes that:
(1) For purposes of determining liability under the
Securities Act of 1933 the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act of 1933 shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability
under the Securities Act of 1933, each post-effective amendment
that contains a form of prospectus shall be deemed to be a new
registration statement relating to the securities offered therein,
and this 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 Securities Act of 1933 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 of 1933
and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to 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 for filing on Form S-3 and has duly caused this
Amendment No. 3 to this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the County of St. Louis and
State of Missouri on the 27th day of March, 2003.
ALLEGIANT BANCORP, INC.
By /s/ Jeffrey S. Schatz
----------------------------------------
Jeffrey S. Schatz, Executive Vice
President and Chief Financial Officer
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 3 to this Registration Statement has been signed below by the
following persons and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
* Chairman of the Board March 27, 2003
------------------------------------
Marvin S. Wool
* Director, President and Chief March 27, 2003
------------------------------------ Executive Officer
Shaun R. Hayes
* Director March 27, 2003
------------------------------------
Robert L. Chambers
* Director March 27, 2003
------------------------------------
Leland B. Curtis
* Director and Secretary March 27, 2003
------------------------------------
Kevin R. Farrell
* Director March 27, 2003
------------------------------------
Richard C. Fellhauer
* Director March 27, 2003
------------------------------------
Leon A. Felman
* Director March 27, 2003
------------------------------------
Douglas P. Helein
* Director March 27, 2003
------------------------------------
Michael R. Hogan
* Director March 27, 2003
------------------------------------
C. Virginia Kirkpatrick
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SIGNATURE TITLE DATE
--------- ----- ----
* Director March 27, 2003
------------------------------------
Nancy C. Pechloff
* Director March 27, 2003
------------------------------------
Thomas M. Teschner
* Director March 27, 2003
------------------------------------
Robert E. Wallace, Jr.
* Director March 27, 2003
------------------------------------
John L. Weiss
* Director March 27, 2003
------------------------------------
Lee S. Wielansky
/s/ Jeffrey S. Schatz Executive Vice President and March 27, 2003
------------------------------------ Chief Financial Officer
Jeffrey S. Schatz (Principal Financial and
Accounting Officer)
*By /s/ Jeffrey S. Schatz
------------------------------
Jeffrey S. Schatz
Attorney-in-Fact
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
------- -----------
1 Underwriting Agreement.
4.1 Restated Articles of Incorporation of the Company, filed as Annex
E to the Company's Registration Statement on Form S-4 (Reg. No.
333-63212) is hereby incorporated by reference.
4.2 Bylaws of the Company, as currently in effect, filed as Annex F
to the Company's Registration Statement on Form S-4 (Reg. No.
333-63212) is hereby incorporated by reference.
5 Opinion of Thompson Coburn LLP.
23.1 Consent of Ernst & Young LLP.
23.3 Consent of Thompson Coburn LLP (included in Exhibit 5).
24 Power of Attorney (set forth on signature page).*
----------
* Previously filed.
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