As filed with the Securities and Exchange Commission on June 19, 1997
Registration No. 333-27975
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------------------------
AMENDMENT NO. 1 TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------------------------
BANK PLUS CORPORATION
(Exact name of registrant as specified in its charter)
---------------------------------------------
DELAWARE 6712 95-1782887
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
---------------------------------------------
4565 Colorado Boulevard
Los Angeles, California 90039
(818) 241-6215
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
---------------------------------------------
Godfrey B. Evans, Esq.
General Counsel
BANK PLUS CORPORATION
4565 Colorado Boulevard
Los Angeles, California 90039
(818) 549-3330
(Name, address, including zip code and telephone number, including area code, of
agent for service)
---------------------------------------------
COPY TO:
Dhiya El-Saden, Esq.
GIBSON, DUNN & CRUTCHER LLP
333 South Grand Avenue
Los Angeles, California 90071
(213) 229-7000
---------------------------------------------
Approximate date of commencement of offers to the holders of securities:
From time to time after the Registration Statement becomes effective.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
---------------------------------------------
THE REGISTRATION HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY IT 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, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
================================================================================
BANK PLUS CORPORATION
CROSS REFERENCE SHEET
Registration Statement Item Caption in Prospectus
- ------------------------------------------- -------------------------------------------------
1. Forepart of the Registration
Statement and Outside Front Cover
Page of Prospectus............................... Facing Page of Registration Statement;
Cross-Reference Sheet; Outside Front Cover Page
of Prospectus
2. Inside Front and Outside Back Cover
Pages of Prospectus.............................. Available Information; Incorporation of Certain
Information by Reference; Table of Contents
3. Risk Factors, Ratio of Earnings to
Fixed Charges, and Other
Information...................................... Cover Page of Prospectus;
Summary; Securities Covered by this Prospectus;
Table of Contents
4. Terms of the Transaction......................... Not Applicable
5. Pro Forma Financial Information.................. Not Applicable
6. Material Contracts with the Company
Being Acquired................................... Not Applicable
7. Additional Information Required for
Reoffering by Persons and Parties
Deemed to be Underwriters........................ Not Applicable
8. Interests of Named Experts and
Counsel.......................................... Legal Opinion; Experts
9. Disclosure of Commission Position
on Indemnification for Securities
Act Liabilities.................................. Not Applicable
10. Information with Respect to S-3
Registrants...................................... Available Information; Summary; Incorporation of
Certain Information by Reference
11. Incorporation of Certain Information
by Reference..................................... Incorporation of Certain Information by Reference
12. Information with Respect to S-2 or
S-3 Registrants.................................. Not Applicable
13. Incorporation of Certain Information
by Reference..................................... Not Applicable
14. Information with Respect to
Registrants Other than S-3 or S-2
Registrants...................................... Not Applicable
15. Information with Respect to S-3
Companies........................................ Not Applicable
16. Information with Respect to S-2 or
S-3 Companies.................................... Not Applicable
17. Information with Respect to
Companies other than S-3 or S-2
Companies........................................ Not Applicable
18. Information if Proxies, Consents or
Authorizations are to be Solicited............... Not Applicable
19. Information if Proxies, Consents or
Authorizations are not to be
Solicited or in an Exchange Offer................ Not Applicable
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JUNE 19, 1997
PROSPECTUS
BANK PLUS CORPORATION
7,594,937 SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE
This Prospectus relates to 7,594,937 shares (the "Shares") of the common
stock, par value $.01 per share (the "Common Stock"), of Bank Plus Corporation
("BPC" or, together with its subsidiaries, the "Company"), that may be issued
from time to time in connection with future business combinations, acquisitions
and mergers. In general, the terms of such combinations, acquisitions and
mergers will be determined by direct negotiations between representatives of the
Company and the owners or principal executives of the companies or other
entities to be so combined, acquired or merged or the assets of which are to be
acquired, and the factors taken into account will include, among other things,
the established quality of management, earning power, cash flow, growth
potential, facilities and locations of the companies or other entities to be
acquired or merged, and the market value of the Common Stock.
The Common Stock is listed on the Nasdaq National Market under the symbol
"BPLS." The last reported sales price per share of the Common Stock, as quoted
on the Nasdaq National Market on May 27, 1997 was $10.625 per share.
_____________________________
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. POTENTIAL
INVESTORS ARE URGED TO READ AND CAREFULLY CONSIDER THE MATTERS SET FORTH UNDER
"RISK FACTORS" BEGINNING ON PAGE 10 HEREOF.
_____________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE. THESE SECURITIES ARE NOT SAVINGS
OR DEPOSIT ACCOUNTS AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, BANK
INSURANCE FUND, SAVINGS ASSOCIATION INSURANCE
FUND OR ANY OTHER GOVERNMENT AGENCY.
__________________________
The date of this Prospectus is _________, 1997.
1
TABLE OF CONTENTS
Page
----
AVAILABLE INFORMATION............................. 3
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE... 3
SUMMARY........................................... 5
SELECTED FINANCIAL DATA OF THE COMPANY............ 7
RISK FACTORS...................................... 10
MARKET PRICES AND DIVIDENDS....................... 16
SECURITIES COVERED BY THIS PROSPECTUS............. 17
LEGAL OPINION..................................... 17
EXPERTS........................................... 17
2
AVAILABLE INFORMATION
Bank Plus is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act"), and the rules and regulations
thereunder, and in accordance therewith file reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information filed by Bank Plus should be
available for inspection and copying at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W. Washington, D.C. 20549
and at the regional offices of the Commission located at Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and at Seven World
Trade Center, New York, New York 10048. Copies of such material can be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 upon payment of prescribed fees. In addition, such
reports, proxy statements and other information should be available for
inspection at the Commission's Web site, available at http://www.sec.gov.
Bank Plus became the holding company of Fidelity pursuant to a
reorganization effected in May of 1996; until that time, such reports, proxy
statements and other information were filed by Fidelity with the Office of
Thrift Supervision (the "OTS"). Reports, proxy statements and other information
filed by Fidelity should be available for inspection and copying at the public
reference facilities maintained by the OTS at the Office of Public Information,
Office of Thrift Supervision, 1700 G Street, N.W., Washington, D.C. 20552, and
also can be obtained by written request from such office at prescribed rates. In
addition, Bank Plus' common stock is listed on The Nasdaq National Market, and
accordingly such reports, proxy statements and other information concerning Bank
Plus and Fidelity also should be available for inspection and copying at the
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006.
Bank Plus has filed with the Commission under the Securities Act of 1933,
as amended (the "Securities Act"), and the rules and regulations thereunder, a
Registration Statement on Form S-4 (as it may be amended, the "Registration
Statement"), with respect to the Shares covered by this Prospectus. This
Prospectus does not contain all of the information contained in the Registration
Statement, certain portions of which have been omitted pursuant to the rules and
regulations of the Commission and to which reference is hereby made. Any
statements contained herein or in any document incorporated by reference herein
concerning the provisions of any contract or other document are not necessarily
complete, and in each instance reference is made to the copy of such contract or
other document filed as an exhibit to the Registration Statement or other
document, each such statement being qualified in its entirety by such reference.
The Registration Statement (and exhibits thereto) should be available for
inspection at the office of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and copies thereof may be obtained from the Commission
at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore or hereafter filed with the Commission
under the Exchange Act are incorporated by reference in this Prospectus:
(1) Bank Plus' Annual Report on Form 10-K for the year ended December 31,
1996;
(2) Bank Plus' Annual Report on Form 10-K/A for the year ended December 31,
1996;
(3) Bank Plus' Quarterly Report on Form 10-Q for the quarter ended March
31, 1997; and
(4) the Registration Statement on Form 8-B/A filed May 10, 1996.
3
All documents filed by Bank Plus pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
filing of a post-effective amendment which indicates that all Shares offered
hereby have been sold or which deregisters all such shares then remaining unsold
shall be deemed to be incorporated by reference into this Prospectus and to be a
part hereof from the date of filing of such documents. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein, or in any subsequently filed
document which also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON REQUEST FROM
NEIL OSBORNE, BANK PLUS CORPORATION, 4565 COLORADO BOULEVARD, LOS ANGELES,
CALIFORNIA 90039, (818) 549-3116. BANK PLUS WILL PROVIDE WITHOUT CHARGE TO ANY
PERSON TO WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF
SUCH PERSON TO THE ADDRESS OR TELEPHONE NUMBER LISTED ABOVE, A COPY OF ANY OR
ALL OF THE FOREGOING DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN
EXHIBITS TO SUCH DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED THEREIN BY
REFERENCE).
________________________
4
SUMMARY
The following information is not intended to constitute a complete
description of the Company and is qualified in its entirety by, and should be
read in conjunction with, the detailed information, consolidated financial
statements and notes thereto included or incorporated by reference in this
Prospectus. Certain capitalized terms used in this Prospectus Summary are
defined elsewhere herein. Unless the context otherwise requires, all references
to the "Company" refer to Bank Plus Corporation, a Delaware corporation ("Bank
Plus"), and its consolidated subsidiaries, which include Fidelity and Gateway
Investment Services, Inc. ("Gateway"), and all references to "Fidelity" or the
"Bank" refer to Fidelity Federal Bank, A Federal Savings Bank, and its
subsidiaries, and, with respect to the period between August 3, 1994 and May 16,
1996, include Gateway, which was a wholly-owned subsidiary of Citadel Holding
Corporation ("Citadel") from November 1, 1992 through August 3, 1994, a direct
wholly-owned subsidiary of Fidelity from August 4, 1994 to May 16, 1996 and a
direct wholly-owned subsidiary of Bank Plus since May 16, 1996.
FORWARD-LOOKING STATEMENTS
Certain statements included or incorporated by reference in this
Prospectus, including without limitation statements containing the words
"believes," "anticipates," "intends," "expects" and words of similar import,
constitute forward-looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
the following: the continuing impact of California's economic recession on
collateral values and the ability of certain borrowers to repay their
obligations to Fidelity; the potential risk of loss associated with the Bank's
high level of nonperforming assets and other assets with increased risk; changes
in or amendments to regulatory authorities' capital requirements or other
regulations applicable to Fidelity; fluctuations in interest rates; increased
levels of competition for loans and deposits; and other factors referred to
under "Risk Factors" and elsewhere in this Prospectus and the documents
incorporated by reference herein. GIVEN THESE UNCERTAINTIES, POTENTIAL
INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON SUCH FORWARD-LOOKING
STATEMENTS. The Company disclaims any obligation to update any such factors or
to publicly announce the result of any revisions to any of the forward-looking
statements included or incorporated by reference herein to reflect future events
or developments.
THE COMPANY
Bank Plus was formed on March 14, 1996 to be the holding company of
Fidelity and Gateway. In May 1996, Fidelity completed a reorganization pursuant
to which all of the outstanding common stock of Fidelity was converted on a one-
for-one basis into all of the outstanding common stock of Bank Plus (the
"Reorganization"). Bank Plus' principal operating subsidiaries are Fidelity and
Gateway, which prior to the reorganization was a subsidiary of the Bank. Bank
Plus currently has no significant business or operations other than serving as
the holding company for Fidelity and Gateway. The principal executive offices of
Bank Plus, Fidelity and Gateway are located at 4565 Colorado Boulevard, Los
Angeles, California 90039, (818) 241-6215.
THE BANK
Fidelity offers a broad range of consumer financial services, including
demand and term deposits and loans to consumers, through 33 full-service
branches, all of which are located in Southern California, principally in Los
Angeles and Orange counties. At this time, the Bank primarily provides
residential
5
mortgages and consumer loans, which the Bank does not underwrite or fund, by
referral to certain established providers of mortgage and consumer loan products
with which the Bank has negotiated strategic alliances.
6
SELECTED FINANCIAL DATA OF THE COMPANY
The table below sets forth certain historical financial data regarding the
Company.
AT OR FOR THE THREE
MONTHS ENDED MARCH 31, At or for the year ended December 31,
------------------------- ------------------------------------------
1997 1996 1996 1995 1994
---------- ---------- ----------- ----------- ------------
(Dollars in thousands, except per share amounts)
BALANCE SHEET DATA:
Total assets............................ $ 3,294,647 $ 3,279,564 $ 3,330,290 $ 3,299,444 $3,709,838
Total loans, net........................ 2,642,217 2,878,311 2,691,931 2,935,116 3,288,303
Deposits................................ 2,516,991 2,579,062 2,495,933 2,600,869 2,697,272
FHLB advances........................... 387,151 232,700 449,851 292,700 332,700
Other borrowings........................ 140,000 209,900 140,000 150,000 500,000
Preferred stock issued by consolidated
subsidiary............................. 51,750 -- 51,750 -- --
Subordinated notes...................... -- -- -- -- --
Stockholders' equity.................... 161,993 227,539 161,657 229,043 156,547
Stockholders' equity per common
share(1)(2)............................ 8.88 12.47 8.86 9.72(3) 24.11
Common shares outstanding(1)(2)......... 18,245,265 18,242,465 18,245,265 18,242,465 6,492,465
OPERATING DATA:
Interest income......................... $ 58,707 $ 60,052 $ 237,913 $ 246,477 $ 241,465
Interest expense........................ 38,350 38,214 152,623 174,836 155,828
----------- ----------- ----------- ----------- ----------
Net interest income..................... 20,357 21,838 85,290 71,641 85,637
Provision for estimated loan losses..... 4,251 3,905 15,610 69,724(4) 65,559
----------- ----------- ----------- ----------- ----------
Net interest income after provision for
estimated loan losses.................. 16,106 17,933 69,680 1,917 20,078
Gains (losses) on loan sales, net....... 7 -- 22 522 (3,963)
Gains on securities and trading
activities, net........................ 1,221 (83) 1,336 4,098 1,130
Gains on sales of servicing............. -- -- -- 4,604 --
Fee income from sale of uninsured
investment products(5)................. 1,513 1,199 4,456 4,117 3,419
Loans, retail banking and other fees.... 1,258 1,604 5,339 6,866 9,040
Real estate operations, net............. (2,301) (2,455) (8,907) (9,145) (17,419)
SAIF special assessment................. -- -- (18,000) -- --
1994 Restructuring and Recapitalization
charges, net........................... -- -- -- -- (65,394)
Operating expense other than SAIF
special assessment and 1994
Restructuring and Recapitalization
charges................................ (14,336) (16,627) (64,451) (81,954) (91,859)
----------- ----------- ----------- ----------- ----------
(Loss) before income taxes and minority
interest in subsidiary................. 3,468 1,571 (10,525) (68,975) (144,968)
Income tax (benefit) expense............ (2,300) 40 (1,093) 4 (16,524)
----------- ----------- ----------- ----------- ----------
Net (loss) earnings before minority
interest in subsidiary................. 5,768 1,531 (9,432) (68,979) (128,444)
Minority interest in subsidiary
(dividends on subsidiary preferred
stock)................................. (1,553) -- (4,657) -- --
----------- ----------- ----------- ----------- ----------
Net (loss) earnings..................... 4,215 1,531 (14,089) (68,979) (128,444)
Preferred stock dividends............... -- 1,553 (1,553) -- --
---------- ------------ ----------- ----------- ----------
Net (loss) earnings available for
common stockholders.................... $ 4,215 $ (22) $ (15,642) $ (68,979) $ (128,444)
=========== =========== =========== =========== ==========
Net (loss) earnings per common
share(1)(2)............................ $ 0.23 $ -- $ (0.86) $ (8.84) $ (39.08)
=========== =========== =========== =========== ==========
Weighted average common shares
outstanding(1)(2)...................... 18,245,265 18,242,465 18,242,887 7,807,201 3,286,960
=========== =========== =========== =========== ==========
At or for the year ended December 31,
--------------------------------------------
1993 1992
----------- -----------
(Dollars in thousands, except per share amounts)
BALANCE SHEET DATA:
Total assets............................ $4,389,781 $4,695,518
Total loans, net........................ 3,712,051 3,990,449
Deposits................................ 3,368,664 3,459,648
FHLB advances........................... 326,400 581,400
Other borrowings........................ 407,830 327,000
Preferred stock issued by consolidated
subsidiary............................. -- --
Subordinated notes...................... 60,000 60,000
Stockholders' equity.................... 182,284 220,171
Stockholders' equity per common
share(1)(2)............................ 173.51 209.57
Common shares outstanding(1)(2)......... 1,050,561 1,050,561
OPERATING DATA:
Interest income......................... $ 289,331 $ 370,715
Interest expense........................ 188,494 240,124
---------- ----------
Net interest income..................... 100,837 130,591
Provision for estimated loan losses..... 65,100 51,180
---------- ----------
Net interest income after provision for
estimated loan losses.................. 35,737 79,411
Gains (losses) on loan sales, net....... 194 1,117
Gains on securities and trading
activities, net........................ 1,304 --
Gains on sales of servicing............. -- --
Fee income from sale of uninsured
investment products(5)................. -- 2,606
Loans, retail banking and other fees.... 8,660 12,291
Real estate operations, net............. (48,843) (22,261)
SAIF special assessment................. -- --
1994 Restructuring and Recapitalization
charges, net........................... -- --
Operating expense other than SAIF
special assessment and 1994
Restructuring and Recapitalization
charges................................ (98,732) (75,044)
---------- ----------
(Loss) before income taxes and minority
interest in subsidiary................. (101,680) (1,880)
Income tax (benefit) expense............ (35,793) (2,167)
---------- ----------
Net (loss) earnings before minority
interest in subsidiary................. (65,887) 287
Minority interest in subsidiary
(dividends on subsidiary preferred
stock)................................. -- --
---------- ----------
Net (loss) earnings..................... (65,887) 287
Preferred stock dividends............... -- --
---------- ----------
Net (loss) earnings available for
common stockholders.................... $ (65,887) $ 287
========== ==========
Net (loss) earnings per common
share(1)(2)............................ $ (62.72) $ 0.27
========== ==========
Weighted average common shares
outstanding(1)(2)...................... 1,050,561 1,050,561
========== ==========
7
AT OR FOR THE
THREE MONTHS
ENDED MARCH 31, At or for the year ended December 31,
---------------------- -----------------------------------------
1997 1996 1996 1995 1994
-------- -------- --------- ---------- ----------
(Dollars in thousands, except per share amounts)
SELECTED OPERATING RATIOS:
(Loss) return on average assets......... 0.51% 0.19% (0.42)% (1.92)% (3.17)%
(Loss) return on average equity......... 10.40% 2.69%(6) (7.01)%(6) (42.31)% (83.00)%
Average equity divided by average assets 4.87% 6.96% 6.71% 4.54% 3.82%
Ending equity divided by ending assets.. 4.92% 6.94% 4.85% 6.94% 4.22%
Operating expense to average assets(7).. 1.72% 2.04% 1.94% 2.28% 2.27%
Efficiency ratio(8)..................... 61.97% 67.71% 67.77% 89.81% 97.58%
Interest rate spread for the period..... 2.13% 2.35% 2.31% 1.89% 2.24%
Net yield on interest-earning assets.... 2.44% 2.68% 2.63% 2.05% 2.22%
ASSET QUALITY DATA:
NPAs(9)................................. $ 63,353 $ 63,644 $ 60,788 $ 71,431 $ 85,729
NPAs to total assets.................... 1.92% 1.94% 1.83% 2.16% 2.31%
Nonaccruing loans....................... $ 39,713 $ 40,111 $ 36,125 $ 51,910 $ 71,614
Nonaccruing loans to total loans, net... 1.50% 1.39% 1.34% 1.77% 2.18%
Classified assets....................... $144,863 $288,902 $174,096 $219,077 $141,536
Classified assets to total assets....... 4.40% 8.81% 5.23% 6.64% 3.82%
REGULATORY CAPITAL RATIOS:
Tangible capital ratio.................. 6.46% 6.95% 6.28% 6.91% 4.28%
Core capital ratio...................... 6.47% 6.96% 6.29% 6.92% 4.29%
Risk-based capital ratio................ 12.29% 12.49% 11.85% 12.43% 8.28%
OTHER DATA:
Sales of investment products(5)......... $ 38,405 $ 30,359 $118,061 $ 89,824 $112,430
Real estate loans funded................ $ 6,488 $ 250 $ 13,859 $ 19,396 $521,580
Average interest rate on new loans...... 8.00% 10.00% 8.41% 9.61% 5.85%
Loans sold, net(10)..................... $ (3,044) $ (1,753) $ (2,069) $ 390 $273,272
Number of:
Real estate loan accounts (in
thousands.......................... 10 11 11 12 14
Deposit accounts (in thousands)....... 192 205 194 207 216
Retail branch offices(11)............. 33 33 33 33 33
At or for the year ended December 31,
------------------------------------------
1993 1992
------------ ----------
(Dollars in thousands, except per share amounts)
SELECTED OPERATING RATIOS:
(Loss) return on average assets......... (1.43)% 0.01%
(Loss) return on average equity......... (29.99)% 0.13%
Average equity divided by average assets 4.77% 4.57%
Ending equity divided by ending assets.. 4.15% 4.69%
Operating expense to average assets(7).. 2.14% 1.52%
Efficiency ratio(8)..................... 79.66% 45.38%
Interest rate spread for the period..... 2.31% 2.66%
Net yield on interest-earning assets.... 2.31% 2.80%
ASSET QUALITY DATA:
NPAs(9)................................. $235,621 $234,405
NPAs to total assets.................... 5.37% 4.99%
Nonaccruing loans....................... $ 93,475 $112,041
Nonaccruing loans to total loans, net... 2.52% 2.83%
Classified assets....................... $372,502 $353,738
Classified assets to total assets....... 8.49% 7.53%
REGULATORY CAPITAL RATIOS:
Tangible capital ratio.................. 4.10% 4.27%
Core capital ratio...................... 4.15% 4.35%
Risk-based capital ratio................ 9.32% 9.76%
OTHER DATA:
Sales of investment products(5)......... $ 96,253 $ 77,078
Real estate loans funded................ $422,355 $435,690
Average interest rate on new loans...... 6.75% 7.77%
Loans sold, net(10)..................... $115,003 $204,435
Number of:
Real estate loan accounts (in
thousands.......................... 16 18
Deposit accounts (in thousands)....... 241 233
Retail branch offices(11)............. 42 43
- ------------------
(1) For the periods prior to August 4, 1994, Fidelity's one share owned by
Citadel, its former holding company and sole stockholder, has been
retroactively reclassified into 1,050,561 shares of Class A Common Stock.
(2) On February 9, 1996, the Bank's stockholders approved a one-for-four reverse
stock split (the "Reverse Stock Split"). All per share data and weighted
average common shares outstanding have been retroactively adjusted to
reflect this change.
(3) Calculation excludes $51.8 million of preferred stock issued by consolidated
subsidiary.
(4) In 1995, the Bank recorded a $45 million loan portfolio charge in connection
with its adoption of an accelerated asset resolution plan (the "Accelerated
Asset Resolution Plan").
(5) Includes 100% of Gateway investment product sales.
(6) Net of dividends on preferred stock of subsidiary of $1.6 million.
(7) Excludes the impact of the Savings Association Insurance Fund ("SAIF")
special assessment and the net 1994 restructuring and recapitalization
charges (the "1994 Restructuring and Recapitalization").
(8) The efficiency ratio is computed by dividing total operating expense by net
interest income and noninterest income, excluding infrequent items,
provisions for estimated loan and real estate losses, direct costs of real
estate operations and gains/losses on the sale of securities.
8
(9) Nonperforming assets ("NPAs") include nonaccruing loans and foreclosed real
estate, net of special valuation allowances ("SVAs"), writedowns and real
estate owned ("REO") general valuation allowance ("GVA"), if any.
(10) Excludes loans sold in certain bulk sales consummated in 1994 (the "Bulk
Sales"), and is net of repurchases.
(11) All retail branch offices are located in Southern California.
9
RISK FACTORS
The Shares offered hereby involve a high degree of risk. In considering
whether to invest in the Shares, investors are urged to read and carefully
consider the matters set forth below, as well as the other information contained
herein.
RISK OF CONTINUING LOSSES
Beginning in late 1991, the impact of the economic recession and
substantial declines in real estate values in Southern California began to
adversely affect collateral values and the ability of certain borrowers to repay
their obligations to the Bank. This led to high levels of non-performing assets
("NPAs") and net chargeoffs in 1991, which adversely affected the Bank's asset
quality and results of operations. The foregoing factors contributed to a net
loss of $65.9 million ($62.72 per share), a net loss of $128.4 million ($39.08
per share) and a net loss of $69.0 million ($8.84 per share) for the years ended
December 31, 1993, 1994 and 1995, respectively. The Bank's losses during these
periods were primarily due to significant increases in the provision for loan
and real estate losses, lower net interest income due primarily to high levels
of NPAs, decreased fee income due primarily to shrinkage of the Bank's deposit
base, and increased operating and other expenses relating to managing the Bank's
problem asset portfolio and the write-off of certain intangible assets.
For the year ended December 31, 1996, the Company reported a net loss
before minority interest in subsidiary of $9.4 million (after giving effect to
the SAIF special assessment of $18.0 million). Earnings during 1996 were
positively affected by, among other things, a reduced provision for estimated
loan losses of $15.6 million compared to provisions of $69.7 million (including
the effect of a $45 million loan portfolio charge taken in connection with the
Bank's adoption of the Accelerated Asset Resolution Plan), $65.6 million and
$65.1 million during 1995, 1994 and 1993, respectively. The lower provision
during 1996 is attributable to, among other things, lower levels of NPAs and
classified assets in 1996 compared to prior years and the effect of the
Accelerated Asset Resolution Plan and the $45.0 million reserve taken in
connection therewith in 1995. No assurance can be given that economic conditions
that may affect the Bank's market area or other circumstances will not require
an increased provision which could have an adverse effect on the Company's
financial condition and results of operations. See "--Adequacy of Allowance for
Loan and Real Estate Losses."
HIGH LEVELS OF NONPERFORMING ASSETS AND OTHER ASSETS WITH INCREASED RISK
Due to significant decreases in rental rates and property values, loans
originated during the years 1987 through 1991 (which included the peak years of
Southern California real estate values in recent periods) are characterized by
generally higher loan to value ratios and lower debt coverage ratios. The levels
of the Bank's NPAs between 1989 and 1994 increased as economic conditions
worsened and contributed to substantial declines in real estate values.
Subsequent to the 1994 Recapitalization and Restructuring, the levels of NPAs
decreased substantially and remained at such lower levels during 1995 and 1996.
As of March 31, 1997, 62% of the outstanding gross loan portfolio was originated
between 1987 and 1991. Of the loan and REO chargeoffs for the three months ended
March 31, 1997, 81% were associated with loans originated in such period. High
levels of NPAs were exacerbated as a result of the Bank's concentration of loans
secured by multifamily properties in geographic areas that suffered particularly
significant declines in rental rates and real estate values and the impact of
the Northridge earthquake. See "--Dependence on Real Estate and High
Concentration of Multifamily Residential Loans."
10
Levels of NPAs may remain at current levels or may increase in the future
as problem loans are worked out and in some instances properties are taken into
REO. The real estate market in Southern California and the overall economy in
the areas where the Bank operates are likely to continue to have a significant
effect on the quality of the Company's assets in the future.
ADEQUACY OF ALLOWANCE FOR LOAN AND REAL ESTATE LOSSES
The Company's results of operations have been adversely affected in recent
years by significant loan and real estate loss provisions taken in light of
significant chargeoffs against the Bank's allowance for estimated loan and REO
losses and high levels of NPAs and increased levels of REO, particularly with
respect to the Bank's loans on multifamily properties of 5 units or more. The
amount of the Bank's allowance for loan losses represents management's estimate
of the amount of loan losses likely to be incurred by the Bank, based upon
various assumptions as to economic and other conditions. As such, the allowance
for loan losses does not represent the amount of such losses that could be
incurred under adverse conditions that management does not consider to be the
most likely to arise. In addition, management's classification of assets and
evaluation of the adequacy of the allowance for loan losses is an ongoing
process. Consequently, there can be no assurance that material additions to the
Bank's allowance for loan losses will not be required in the future, thereby
adversely affecting earnings and the Bank's ability to maintain or build
capital. While management believes that the current allowance is adequate to
absorb the known and inherent risks in the loan portfolio, no assurances can be
given that the allowance is adequate or that economic conditions which may
adversely affect the Bank's market area or other circumstances will not result
in future loan or REO losses, which may not be covered completely by the current
allowance or may require an increased provision which could have an adverse
effect on the Bank's financial condition and results of operations. Significant
additional loan and real estate loss provisions may negatively impact the Bank's
future results of operations and levels of regulatory capital.
ECONOMIC CONDITIONS IN FIDELITY'S MARKET AREA
The performance of the Bank's multifamily and commercial loan portfolios
has been adversely affected by Southern California economic conditions. These
portfolios are particularly susceptible to the potential for further declines in
the Southern California economy, such as increasing vacancy rates, declining
rents, increasing interest rates, declining debt coverage ratios and declining
market values for multifamily and commercial properties. In addition, the
possibility that investors may abandon properties or seek bankruptcy protection
with respect to properties experiencing negative cash flow, particularly where
such properties are not cross-collateralized by other performing assets, can
also adversely affect the multifamily loan portfolio.
California has been hit particularly hard by adverse economic conditions
and Southern California has experienced the brunt of the economic downturn in
the state. Although certain economic indicators suggest that the Southern
California economy is beginning to improve, many factors key to recovery may be
impacted adversely by the Federal Reserve Board's interest rate policy as well
as other factors. Consequently, rents and real estate values may not stabilize,
which may affect future delinquency and foreclosure levels and may adversely
impact the Company's asset quality, earning performance and capital levels.
DEPENDENCE ON REAL ESTATE AND HIGH CONCENTRATION OF MULTIFAMILY RESIDENTIAL
LOANS
At March 31, 1997, substantially all of the Bank's loan portfolio was
secured by real estate, and the Company had $23.6 million of net REO. In light
of the economic recession in Southern California and the impact it has had and
may have on the Southern California real estate market, the Bank's real estate
11
dependence and high concentration of multifamily loans on properties of 5 or
more units (approximately 62% of the Bank's mortgage loan portfolio) increases
the risk of loss in the Bank's loan portfolio.
Prior to the 1994 Restructuring and Recapitalization, the Bank experienced
high delinquency rates in its multifamily portfolio of 5 or more units
reflecting, among other things, (i) high vacancy rates, (ii) low apartment
rental rates, (iii) a greater willingness of borrowers to abandon such
properties or seek bankruptcy protection, particularly where such properties are
experiencing negative cash flow and the loans are not cross-collateralized by
other performing properties, and (iv) the substantial decreases in the market
value of multifamily properties experienced in recent periods (resulting, in
many cases, in appraised values less than the outstanding loan balances).
Multifamily lending on properties of 5 or more units typically involves
larger loans to a single obligor and is generally viewed as exposing the lender
to a greater risk of loss than single family and multifamily (2 to 4 units)
lending. The liquidation value of multifamily properties may be adversely
affected by risks generally incident to interests in real property, which
include: changes or continued weakness in general or local economic conditions
and/or specific industry segments, declines in real estate values, declines in
rental, room or occupancy rates, increases in interest rates, real estate and
personal property tax rates and other operating expenses (including energy
costs), the availability of refinancing, changes in governmental rules,
regulations and fiscal policies, including rent control ordinances and
environmental legislation, and other factors beyond the control of the borrower
or the lender.
CAPITAL REQUIREMENTS
The minimum capital requirements applicable to savings associations, such
as the Bank, were significantly increased by the Financial Institutions Reform,
Recovery, and Enforcement Act of 1989 ("FIRREA"). Under FIRREA, as implemented
to date by the Office of Thrift Supervision (the "OTS"), thrifts are required to
maintain ratios of tangible capital to adjusted total assets (as defined in the
regulations) of at least 1.5%, core capital to adjusted total assets (as defined
in the regulations) of at least 3% and total capital to risk-weighted assets (as
defined in the regulations) of at least 8%.
The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), among other things, required the OTS to implement a system providing
for regulatory sanctions against institutions that are not adequately
capitalized. The severity of the sanctions increases to the extent that an
institution's capital continues to decline. Under the Prompt Corrective Action
("PCA") Regulations, an institution is adequately capitalized (and, therefore,
not undercapitalized) if (1) its ratio of core capital to adjusted total assets
(as defined in the regulations) is at least 4%, (2) its ratio of core capital to
risk-weighted assets (as defined in the regulations) is at least 4% and (3) its
ratio of total capital to risk-weighted assets (as defined in the regulations)
is at least 8%. An institution is treated as well capitalized if its core
capital to adjusted total assets ratio is at least 5%, its core capital to risk-
weighted assets ratio is at least 6%, and its total capital to risk-weighted
assets is at least 10% and no OTS order or directive requiring higher capital
ratios is then in effect.
At March 31, 1997, the Bank met the requirements to be deemed well
capitalized for regulatory purposes. However, there can be no assurance that
the Bank will remain well capitalized in the future.
The OTS also has the authority to establish, for individual thrifts, an
individual minimum capital requirement ("IMCR") in excess of the standard
requirement upon a determination by the OTS that such an IMCR is necessary or
appropriate in light of such thrift's particular circumstances. For example, the
OTS may determine that an IMCR is appropriate if, among other things, the OTS
believes that an institution (i)
12
has a high degree of exposure to interest rate risk or credit risk, (ii) has a
high degree of exposure to concentration of credit risk or risks arising from
nontraditional activities or fails to adequately monitor and control the risks
presented by concentration of credit and nontraditional activities, (iii) may be
adversely affected by the operation or condition of its holding company, (iv)
has a portfolio reflecting weak credit quality or a significant likelihood of
financial loss or (v) has inadequate underwriting standards or procedures. If
the OTS determines that an IMCR should be imposed on an institution, the
institution has an opportunity to submit a response to the OTS, but may have no
opportunity for judicial review of an IMCR. If an institution fails to meet
either the standard minimum capital requirements or any IMCR that may be imposed
on it, it will become subject to a number of regulatory sanctions. Although the
Bank is not currently subject to an IMCR, these can be no assurance that the
Bank will not be subject to an IMCR in the future.
The Bank's failure to meet its regulatory capital requirements would
provide grounds for one or more of the following actions, depending on the
severity of the violation: a requirement that the Bank file a capital
restoration plan, a requirement that the Bank take additional actions to comply
with the capital restoration plan, the issuance of a cease and desist order, the
issuance of a capital directive, the imposition of civil money penalties on the
Bank and certain affiliated parties, the imposition of such operating
restrictions as the OTS deems appropriate at the time, such other actions by the
OTS as it may be authorized or required to take under applicable statutes and
regulations and, under certain circumstances, the appointment of a conservator
or receiver for the Bank.
FLUCTUATIONS IN INTEREST RATES
Prevailing economic conditions, particularly changes in market interest
rates, as well as governmental policies and regulations concerning, among other
things, monetary and fiscal affairs, significantly affect interest rates and a
savings institution's net interest income. The results of operations of the
Company depend to a large extent on net interest income, which is the difference
between interest the Company receives from its loans, securities and other
interest-earning assets and the interest expense the Company pays on its
deposits and other interest-bearing liabilities. The Company is subject to risk
from fluctuations in interest rates to the extent its interest-bearing
liabilities mature or reprice at different times or on a different basis than
its interest-earning assets. Generally speaking, maturing liabilities, such as
deposits, may be replaced only with new liabilities paying interest rates
prevailing at the time of maturity, which may possibly be higher than the rates
applicable to the liabilities they replaced. Similarly, rates paid on
liabilities which reprice or adjust are adjusted based on interest rates
prevailing at the time of the repricing or adjustment. "Gap," generally
speaking, represents the estimated difference between the amount of
interest-earning assets and interest-bearing liabilities repricing during future
periods as adjusted for interest-rate swaps and other financial instruments as
applicable, and based on certain assumptions. One method the Company uses to
measure its exposure to interest rate fluctuations is by calculating its one-
year Gap, which is the ratio of (i) the difference between interest-sensitive
assets and those liabilities that mature or reprice within 12 months to (ii)
total assets. Analysis of the Gap provides only a static view of the Bank's
interest rate sensitivity at a specific point in time. The actual impact of
interest rate movements on the Company's net interest income may differ from
that implied by any Gap measurement. The Company's maturity and repricing
mismatch between interest rate sensitive assets and liabilities due within one
year was a positive 18.99% at March 31, 1997, compared to a negative one-year
Gap of 2.84% at December 31, 1996 and a positive one-year Gap of 7.06% at
December 31, 1995. With a positive one-year Gap, the Company would anticipate a
rising net interest rate margin over the near term in a rising rate environment.
Conversely, in a falling interest rate environment, the Company would anticipate
that net interest margin would be adversely affected.
At March 31, 1997, approximately 93.5% of the Company's total loan
portfolio consisted of loans which mature or reprice in accordance with the
Federal Home Loan Bank Eleventh District Cost of Funds Index within one year,
compared with approximately 92.6% at December 31, 1996, approximately 92.4%
13
at December 31, 1995 and approximately 90.6% at December 31, 1994. During the
latter part of 1995 and early 1996, the Company benefited from the fact that
decreases in the interest rates accruing on the Company's adjustable rate
mortgage ("ARM") loans lagged the decreases in interest rates accruing on its
deposits. During the rising interest rate environment experienced in early 1995
and the latter part of 1996, however, the Company's net interest margin was
reduced. If interest rates were to increase again, the Company's net interest
income may suffer further as a result.
SIGNIFICANT REGULATION
The financial institutions industry is subject to significant regulation,
which has materially affected the industry in the past and will likely do so in
the future. Such regulations, which affect Fidelity and Bank Plus on a daily
basis, may be changed at any time, and the interpretation of the relevant law
and regulations is also subject to change by the authorities who examine the
Bank and interpret those laws and regulations. There can be no assurance that
any present or future changes in the laws or regulations or in their
interpretation will not materially and adversely affect the Company.
LEGAL PROCEEDINGS
The Bank was named as a defendant in a purported class action lawsuit
alleging violations of federal securities laws in connection with the offering
of common stock by the Bank in 1994 as part of the Bank's 1994 Restructuring and
Recapitalization. The suit was filed by Harbor Finance Partners ("Harbor") in
an alleged class action complaint in the United States District Court-Central
District of California on July 28, 1995 and originally named as defendants the
Bank, Citadel, Richard M. Greenwood (the Bank's chief executive officer and
Citadel's former chief executive officer), J.P. Morgan Securities, Inc. and
Deloitte & Touche LLP. The suit alleged that false or misleading information
was provided by the defendants in connection with the Bank's 1994 Restructuring
and Recapitalization and stock offering and that the defendants knew and failed
to disclose negative information concerning the Bank. A motion to dismiss the
original complaint was filed by the Bank, and was granted without opposition.
Thereafter, Harbor filed an amended complaint that did not include J.P. Morgan
Securities, Inc. and Deloitte & Touche LLP as defendants and that contained some
factual and legal contentions which were different from those set forth
originally. On May 21, 1996, the court granted the Bank's and Greenwood's motion
to dismiss the first amended complaint, but granted leave to amend. Following
the filing of a second amended complaint, the Bank and Greenwood filed a motion
to dismiss. At a hearing on July 22, 1996, the court ruled that the case should
be dismissed with prejudice and a formal order to that effect was submitted to
the court for execution. Harbor lodged certain objections to the proposed order,
including objections that the state law claims in the second amended complaint
should not be dismissed with prejudice. The court's order of dismissal was
entered on August 5, 1996 and provided that all claims asserted in the second
amended complaint under federal law were dismissed with prejudice and those
under state law were dismissed without prejudice to their renewal in state court
pursuant to 28 U.S.C. (S) 1367(b)(3). Harbor has filed a notice of appeal to the
order of dismissal. The briefing in the appeal is now concluded and the appeal
awaits hearing and disposition. On August 30, 1996, Harbor filed an alleged
class action complaint in state court containing allegations similar to those
raised in the federal court action as well as claims for unfair business
practices to which the Bank and Greenwood filed demurrers seeking to have the
case dismissed for failure to state a legally sufficient claim. These demurrers
were sustained without leave to amend on March 13, 1997 and it is expected that
a judgment of dismissal will be entered in the trial court. The plaintiff will
have 60 days from notice of the entry of judgment to file an appeal.
In addition, the Bank is a defendant in several individual and purported
class actions brought by several borrowers which raise claims with respect to
the manner in which the Bank serviced certain
14
adjustable rate mortgages which were originated during the period 1983 through
1988. The actions have been filed between July 1, 1992 and February of 1995. In
one case the Bank won a summary judgment in Federal District Court. This
judgment was appealed. On July 25, 1996, the Ninth Circuit Court of Appeals
filed its opinion which affirmed in part, reversed in part and remanded back to
the Federal District Court for further hearing. In three Los Angeles Superior
Court cases, judgments in favor of the Bank were recently entered. Plaintiff has
appealed in all three cases. Two other cases are pending in the Los Angeles
Superior Court. The plaintiffs' principal claim is that the Bank selected an
inappropriate review date to consult the index upon which the rate adjustment is
based that was one or two months earlier than what was required under the terms
of the notes. In a declining interest rate environment, the lag effect of an
earlier review period defers the benefit to the borrower of such decline, and
the reverse would be true in a rising interest rate environment. The Bank
strongly disputes these contentions and is vigorously defending these suits. The
legal responsibility and financial exposure of these claims presently cannot be
reasonably ascertained and, accordingly, there is a risk that the final outcome
of one or more of these actions could result in the payment of monetary damages
that could be material in relation to the financial condition or results of
operations of the Bank. The Bank does not believe the likelihood of such a
result is probable and has not established any specific litigation reserves with
respect to such lawsuits.
Although there can be no assurance, the Company's management and its
counsel believe that none of the foregoing lawsuits or claims will have a
material adverse effect on the financial condition or business of the Company.
COMPETITION
The Company faces substantial competition for loans and deposits throughout
its market areas. The Company competes on a daily basis with commercial banks,
other savings institutions, thrift and loans, credit unions, finance companies,
retail investment brokerage houses, mortgage banks, money market and mutual
funds and other investment alternatives and other financial intermediaries, many
of which have substantially greater resources, experience and capital than the
Company. The Company faces competition throughout its market area from local
institutions, which have a large presence in the Company's market areas, as well
as from out-of-state financial institutions which have offices in the Company's
market areas. Many of these other institutions offer services which the Company
does not offer, including trust services. Furthermore, banks with a larger
capital base and financial firms not subject to the restrictions imposed by
banking regulation have larger lending limits and can therefore serve the needs
of larger customers.
15
MARKET PRICES AND DIVIDENDS
COMMON STOCK
Effective March 14, 1996, the Bank's Class A Common Stock was listed and
quoted on The Nasdaq National Market. Commencing May 5, 1996, the Common Stock
was listed and quoted on The Nasdaq National Market replacing the Bank's Class A
Common Stock. During 1995 and part of 1994, the Class A Common Stock of the
Bank was traded over the counter and quoted on the Over the Counter Bulletin
Board ("the "OTCBB").
The following table sets forth the high and low daily closing sales prices
of the Common Stock on The Nasdaq National Market commencing May 5, 1996, the
high and low daily closing sales prices of the Bank's Class A Common Stock on
The Nasdaq National Market between March 14, 1996 and May, 1996 and the high and
low bid price of the Bank's Class A Common Stock on the OTCBB between May 5,
1995 and May 5, 1996 for each of the following quarters:
HIGH LOW
------ ------
1997(1)
First quarter...................................... $13.75 $10.38
1996(1)
Fourth quarter..................................... 11.75 10.63
Third quarter...................................... 10.63 8.75
Second quarter..................................... 9.50 8.63
First quarter...................................... 9.75 8.50
1995(1)(2)
Fourth quarter..................................... 9.25 5.50
Third quarter...................................... 11.50 6.00
Second quarter..................................... 18.00 11.00
First quarter...................................... 20.00 16.00
- ----------------------------
(1) Closing sale prices reflect the one-for-four reverse stock split approved by
stockholders of the Bank on February 9, 1996.
(2) Prior to May 5, 1995, the Bank's Class A Common Stock was not quoted on the
OTCBB and bid prices were provided by J.P. Morgan Securities, Inc.
The number of holders of record of the Common Stock on May 28, 1997 was
228.
Bank Plus has paid no dividends on the Common Stock since its formation in
May 1996. Prior thereto, the Bank had not paid dividends on its Class A Common
Stock since August 1994. Bank Plus currently has no plans to pay dividends on
the Common Stock.
16
SECURITIES COVERED BY THIS PROSPECTUS
The Shares of the Common Stock covered by this Prospectus consist of
7,594,937 shares which may be issued or delivered from time to time in
connection with future business combinations, mergers and/or acquisitions. The
consideration for such combinations, acquisitions and mergers may consist of
cash, assumption of liabilities, evidences of debt, Common Stock or a
combination thereof. In general, the terms of such combinations, acquisitions
and mergers will be determined by direct negotiations between representatives of
the Company and the owners or principal executives of the companies or other
entities to be so combined, acquired or merged or the assets of which are to be
acquired, and the factors taken into account will include, among other things,
the established quality of management, earning power, cash flow, growth
potential, facilities and locations of the companies or other entities to be
acquired or merged, and the market value of the Common Stock. It is anticipated
that the shares of the Common Stock issued or delivered in connection therewith
will be valued at a price reasonably related to the market value of the Common
Stock either at the time the terms of the combination, acquisition or merger are
tentatively agreed upon, or at or about the time or times such shares are issued
or delivered.
Persons who directly or indirectly control, are controlled by, or are under
common control with, companies or other entities which are acquired by or merged
or combined with the Company may be deemed to be engaged in a distribution of
securities, and therefore underwriters of securities within the meaning of
Section 2(11) of the Securities Act, if such persons offer or sell any Shares
covered by this Prospectus other than in accordance with the provisions of
paragraph (d) of Rule 145 under the Securities Act or pursuant to an effective
registration statement. Rule 145(d) provides that such persons will not be
deemed to be underwriters if (a) among other things, (i) the Company has
complied with certain reporting requirements of the Exchange Act, (ii) the
amounts of such shares sold fall within certain volume limitations, (iii) such
shares are sold only in brokers' transactions within the meaning of Section 4(4)
of the Securities Act or in a manner otherwise permitted by Rule 144 under the
Securities Act, (iv) such persons do not solicit or arrange for the solicitation
of orders to buy such shares in anticipation of or in connection with the sale
thereof, and (v) such persons do not make any payments in connection with the
offer or sale thereof to any persons other than the brokers executing the orders
to sell such shares; (b) such persons are not affiliates of the Company and have
been the beneficial owners of the Shares for at least two years, and the Company
has complied with certain reporting requirements of the Exchange Act; or (c)
such persons are not, and have not been for at least three months, affiliates of
the Company and have been the beneficial owners of the Shares for at least three
years.
LEGAL OPINION
The validity of the Shares offered hereby will be passed upon by Gibson,
Dunn & Crutcher LLP, Los Angeles, California, counsel to Bank Plus.
EXPERTS
The financial statements and the related financial statement schedules
incorporated in this prospectus by reference from the Company's Annual Report on
Form 10-K and Form 10-K/A for the year ended December 31, 1996 have been audited
by Deloitte & Touche LLP, independent auditors, as stated in their report, which
is incorporated herein by reference, and have been so incorporated in reliance
upon the report of such firm given upon their authority as experts in accounting
and auditing.
17
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law (the "DGCL") authorizes corporations
to limit or eliminate the personal liability of directors to the corporation and
its stockholders for monetary damages in connection with the breach of a
director's fiduciary duty of care. The duty of care requires that, when acting
on behalf of the corporation, directors must exercise an informed business
judgment based on all material information reasonably available to them. Absent
the limitation authorized by the DGCL, directors could be accountable to
corporations and their stockholders for monetary damages for conduct that does
not satisfy such duty of care. Although the DGCL does not change a director's
duty of care, it enables corporations to limit available relief to equitable
remedies such as injunction or rescission. The Registrant's certificate of
incorporation limits the liability of directors to the Registrant or its
stockholders to the fullest extent permitted by the DGCL as in effect from time
to time. Specifically, directors of the Registrant will not be personally
liable for monetary damages for breach of a director's fiduciary duty as a
director, except for liability (i) for any breach of the director's duty of
loyalty to the Registrant or its stockholder, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) for unlawful payments of dividends or unlawful stock repurchases or
redemptions as provided in Section 174 of the DGCL or (iv) for any transaction
from which the director derived an improper personal benefit. This provision
does not affect a director's responsibilities under certain other laws such as
the federal securities laws or state or federal environmental laws.
The bylaws of the Registrant provide that the Registrant shall indemnify
its officers, directors and employees to the fullest extent permitted by the
DGCL. The Registrant believes that indemnification under its bylaws covers at
least negligence and gross negligence on the part of the indemnified parties.
The Registrant has entered into indemnification agreements with its
directors and officers which provide for broad indemnification, except where the
"reviewing party" has determined that the indemnitee would not be entitled to be
indemnified under applicable law. The "reviewing party" is defined as the
majority vote of the directors of Registrant not subject to the particular claim
or, if none, independent legal counsel selected by the indemnitee and approved
by the Registrant. No payments may be made under these indemnification
agreements in connection with claims made against a director or officer for
which payment is made under an insurance policy or for which such person is
otherwise indemnified.
Under an insurance policy currently maintained by the Registrant, the
directors and officers of the Registrant are insured, within the limits and
subject to the limitations of the policy, against certain expenses in connection
with the defense of certain claims, actions, suits or proceedings, and certain
liabilities which may be imposed as a result of such claims, actions, suits or
proceedings which may be brought against them by reason of being or having been
such directors or officers.
II-1
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits.
2.1 Agreement and Plan of Reorganization, dated as of March 27,
1996, among Fidelity, Bank Plus and Fidelity Interim Bank
(incorporated by reference to Exhibit 2.1 to the Form 8-B of
Bank Plus filed with the Commission on April 22, 1996 (the
"Form 8-B")).
4.1 Certificate of Incorporation of Bank Plus Corporation
(incorporated by reference to Exhibit 3.1 to the Form 8-B).
4.2 By-laws of Bank Plus Corporation (incorporated by reference to
Exhibit 3.2 to the Form 8-B).
5.1* Opinion of Gibson, Dunn & Crutcher LLP regarding the validity
of the securities being registered.
23.1* Consent of Deloitte & Touche LLP.
23.4* Consent of Gibson, Dunn & Crutcher LLP (included in Exhibit
5.1).
24.1 Powers of Attorney (previously filed).
(b) Not applicable.
(c) Not applicable.
___________________
* Filed herewith
II-2
ITEM 22. UNDERTAKING.
The undersigned Registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933.
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (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 the Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4,10(b), 11, or 13 of this Form,
within one business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date of the
Registration Statement through the date of responding to the request.
(d) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the Registration Statement when it became
effective.
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 provisions referred to in Item 20, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event 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
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the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction, the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Amendment No. 1 to Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Los Angeles, State
of California, on this 18th day of June, 1997.
BANK PLUS CORPORATION
By: /s/ Richard M. Greenwood
----------------------------------
Richard M. Greenwood
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to the Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Richard M. Greenwood President, Chief Executive June 18, 1997
- ---------------------------
Richard M. Greenwood Officer and Director
(principal executive officer)
/s/ William L. Sanders Executive Vice President and June 18, 1997
- ---------------------------
William L. Sanders Chief Financial Officer
(principal financial officer)
/s/ Richard M. Villa Senior Vice President and June 18, 1997
- ----------------------------
Richard M. Villa Controller
(principal accounting officer)
/s/ Norman Barker, Jr.* Director June 18, 1997
- ---------------------------
Norman Barker, Jr.
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/s/ Waldo H. Burnside* Director June 18, 1997
- ---------------------------
Waldo H. Burnside
/s/ George Gibbs, Jr.* Director June 18, 1997
- ---------------------------
George Gibbs, Jr.
/s/ Lilly V. Lee* Director June 18, 1997
- ---------------------------
Lilly V. Lee
/s/ Gordon V. Smith* Director June 18, 1997
- ---------------------------
Gordon V. Smith
/s/ Mark Sullivan III* Director June 18, 1997
- ---------------------------
Mark Sullivan III
* By Attorney-in-Fact, Richard M. Greenwood
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EXHIBIT INDEX
EXHIBIT DESCRIPTION
------- -----------
2.1 Agreement and Plan of Reorganization, dated as of March 27,
1996, among Fidelity, Bank Plus and Fidelity Interim Bank
(incorporated by reference to Exhibit 2.1 to the Form 8-B of
Bank Plus filed with the Commission on April 22, 1996 (the
"Form 8-B")).
4.1 Certificate of Incorporation of Bank Plus Corporation
(incorporated by reference to Exhibit 3.1 to the Form 8-B).
4.2 By-laws of Bank Plus Corporation (incorporated by reference to
Exhibit 3.2 to the Form 8-B).
5.1* Opinion of Gibson, Dunn & Crutcher LLP regarding the validity
of the securities being registered.
23.1* Consent of Deloitte & Touche LLP.
23.4* Consent of Gibson, Dunn & Crutcher LLP (included in Exhibit 5.1).
24.1 Powers of Attorney (previously filed).
- ---------------------
* Filed herewith.
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