SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 14, 2004
CAPITOL BANCORP LTD.
(Exact name of registrant as specified in its charter)
| Michigan | | 001-31708 | | 38-2761672 | |
(State or other jurisdiction
of incorporation) | | (Commission File No.) | | (IRS Employer
Identification No.) | |
Capitol Bancorp Center
200 Washington Square North, Lansing, Michigan 48933
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code:(517) 487-6555
Item 5. Other Events and Regulation FD Disclosure.
On January 14, 2004, Capitol Bancorp Ltd., a Michigan corporation (“Capitol”), entered into an agreement and plan of merger by and among Capitol, CBCL Acquisition Corp., a Washington corporation and wholly-owned subsidiary of Capitol (“CBCL”), and AEA Bancshares, Inc., a Washington corporation (“AEA”), providing for Capitol’s acquisition of AEA pursuant to the merger of AEA with and into CBCL, with CBCL surviving the merger. Upon consummation of the merger, CBCL will continue its corporate existence under the laws of the State of Washington. A copy of Capitol’s press release relating to the execution of such agreement is attached as Exhibit 99.1 to this report.
Consummation of the merger is subject to certain conditions, including approval by the shareholders of AEA and receipt of various regulatory approvals. The merger is expected to close during the second quarter of 2004.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
| Exhibit No. | Description of Exhibit |
| |
| 99.1 | Press Release dated January 14, 2004. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CAPITOL BANCORP LTD | |
| (Registrant) | |
|
| Date: January 14, 2004 | /s/ Joseph D. Reid
|
| Joseph D. Reid, Chief Executive Officer |
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INDEX TO EXHIBITS
| Exhibit No. | Description of Exhibit |
| 99.1 | Press Release dated January 14, 2004. |
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EXHIBIT 99.1
NEWS RELEASE
 | Capitol Bancorp Center
200 Washington Square North
Lansing, MI 48933
2777 East Camelback Road
Suite 375
Phoenix, AZ 85016
www.capitolbancorp.com
Analyst Contact: Michael M. Moran
Chief of Capital Markets
877-884-5662
Media Contact: Joal Redmond
Corporate Communications
602-977-3797 |
CAPITOL BANCORP LIMITED ANNOUNCES PLANS TO ACQUIRE
SEATTLE-BASED AEA BANCSHARES, INC.
LANSING, Mich., and PHOENIX: January 14, 2004: Capitol Bancorp Limited (NYSE:CBC), a $2.7 billion bank development company, today announced the signing of a definitive agreement to acquire AEA Bancshares, Inc., a $148 million bank holding company headquartered in Seattle, Washington.
Asia-Europe-Americas Bank (AEA), the wholly-owned subsidiary of AEA Bancshares, Inc., is a multi-cultural bank, founded in 1995 to provide financial services to small-to-medium size businesses, entrepreneurs, and individuals in the Greater Seattle area. Capitol Bancorp currently operates 30 separately chartered affiliate community banks in eight states and recently announced its intent to purchase First Carolina State Bank, a $60 million community bank in Rocky Mount, North Carolina.
“We believe this transaction with AEA to be an excellent strategic growth opportunity for both companies,” stated Joseph D. Reid, Chairman and CEO of Capitol Bancorp. “The addition of AEA enables us to enter the Pacific Northwest region with a banking operation that understands and reflects the diversity that is so intrinsic to the vibrancy of Seattle and its surrounding communities.”
Subsequent to the acquisition, AEA will continue to operate as a separately chartered bank affiliate within the Capitol Bancorp family, and will represent Capitol Bancorp’s first bank in the Northwestern United States.
“We have been interested in establishing a presence in the Northwest for some time and believe this transaction provides a solid entry point while facilitating continued growth for Capitol and AEA. Both parties share the basic belief that people want access to quality financial services through personalized service, and each organization has been successfully built upon that principle.”
Commenting on the transaction, Per-Odd Keul, Chairman, CEO and President of AEA said, “We are excited that our success as a company that respects and strives to work with our multi-cultural communities has given us this opportunity to partner with Capitol and its myriad of resources. Our customers have benefited from a very special relationship with our staff and board of directors and we do not see that changing. It will be business as usual but with a wider range of products and services through the strength and resources Capitol can offer us.”
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Added Reid, “We will continue to welcome opportunities like this as well as continue with our very successful approach to growth throughde novo banking. The common denominator for any transaction we might pursue is that there is a set of core values shared by the management and boards of both parties.”
The transaction is subject to a final due diligence examination by Capitol Bancorp, approval by regulatory agencies and AEA’s shareholders, and certain other conditions. Pending approvals, the transaction is expected to be completed mid-year 2004.
###
Transaction Terms
The transaction consideration will be comprised of three distinct components. Each share of AEA common stock outstanding will be converted into the right to receive a combination of cash and stock of Capitol, with the stock component based on Capitol’s average trading price at closing determined in accordance with the merger agreement. At closing, AEA shareholders will receive $11 million in Capitol Bancorp common stock. In addition, a cash consideration of $6 million will be immediately used to purchase certain select assets from AEA for potential future distribution to AEA shareholders. A trustee has been appointed to facilitate the collection and subsequent distribution of such assets on behalf of AEA shareholders. The third, and final, component of the merger transaction is a performance-driven earn-out provision. Pending the ability of AEA to achieve certain earnings criteria under the terms of the agreement, AEA shareholders may receive an additional $3 million in Capitol Bancorp common stock at the end of both 2004 and 2005. At December 31, 2003, AEA had outstanding approximately 289,000 shares of common stock. In addition, AEA has outstanding approximately 24,400 options with an average exercise price of approximately $45 per share and 20,800 warrants with an average exercise price of $25 per share, which will be cashed-out based on the initial $11 million common stock component. Consummation of the transaction is not expected to have a material impact on Capitol’s 2004 earnings per share.
About Capitol Bancorp Limited
Capitol Bancorp Limited is a $2.7 billion community bank development company, with 30 individual bank charters operating in eight states. Capitol Bancorp Limited identifies opportunities for the development of new community banks, raises capital and mentors a community bank through its formative stages. Each community bank has full local decision-making authority and is managed by an on-site president under the direction of a local board of directors composed of business leaders from the bank’s community. Capitol Bancorp Limited was founded in 1988 and has headquarters in Lansing, Mich. and Phoenix, Ariz. The company was named toFortunemagazine’s 100 fastest-growing small public companies in the country in July 2003.
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Capitol Bancorp’s operations include the following banks and loan production offices (LPO):
| Great Lakes Region: | | | |
| |
| Indiana: | |
| Elkhart Community Bank | | Elkhart | |
| Goshen Community Bank | | Goshen | |
| |
| Michigan: | |
| Ann Arbor Commerce Bank | | Ann Arbor | |
| Brighton Commerce Bank | | Brighton | |
| Capitol National Bank | | Lansing | |
| Detroit Commerce Bank | | Detroit | |
| Grand Haven Bank | | Grand Haven | |
| Kent Commerce Bank | | Grand Rapids | |
| Macomb Community Bank | | Clinton Township | |
| Muskegon Commerce Bank | | Muskegon | |
| Oakland Commerce Bank | | Farmington Hills | |
| Paragon Bank & Trust | | Holland | |
| Portage Commerce Bank | | Portage | |
| |
| Southwest Region: | |
| |
| Arizona: | |
| Arrowhead Community Bank | | Glendale | |
| Bank of Tucson | | Tucson | |
| Camelback Community Bank | | Phoenix | |
| East Valley Community Bank | �� | Chandler | |
| Mesa Bank | | Mesa | |
| Southern Arizona Community Bank | | Tucson | |
| Sunrise Bank of Arizona | | Phoenix | |
| Valley First Community Bank | | Scottsdale | |
| Yuma Community Bank | | Yuma | |
| |
| Nevada: | |
| Bank of Las Vegas | | Las Vegas | |
| Black Mountain Community Bank | | Henderson | |
| Desert Community Bank | | Las Vegas | |
| Red Rock Community Bank | | Las Vegas | |
| |
| New Mexico: | |
| Sunrise Bank of Albuquerque | | Albuquerque | |
| |
| Texas: | |
| Sunrise Bank - Dallas LPO | | Dallas | |
| Sunrise Bank - Houston LPO | | Houston | |
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| California Region: | | | |
| |
| Bank of Escondido | | Escondido | |
| Napa Community Bank | | Napa | |
| Sunrise Bank of San Diego | | San Diego | |
| Sunrise Bank - Orange County LPO | | Irvine | |
| |
| Southeast Region: | |
| |
| Georgia: | |
| Sunrise Bank - Atlanta LPO | | Atlanta | |
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