Maryland | 6712 | 36-4670835 |
(State or Other Jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer |
Incorporation or Organization) | Classification Code Number) | Identification Number) |
Large accelerated filer | o | Accelerated filer | o | |
Non-accelerated filer | o | Smaller reporting company | x | |
(Do not check if a smaller reportingcompany) |
Title of each class of
securities to be registered
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Amount to be
registered
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Proposed maximum
offering price per share
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Proposed maximum
aggregate offering price
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Amount of
registration fee
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Common Stock, $0.01 par value per share
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2,873,515 shares
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$10.00
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$28,735,150 (1)
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$2,049 (2)
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Participation interests
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630,516 interests (3)
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(3)
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(1)
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Estimated solely for the purpose of calculating the registration fee.
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(2)
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Previously paid.
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(3)
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The securities of Jacksonville Bancorp, Inc. to be purchased by Jacksonville Savings Bank 401(k) Profit Sharing Plan are included in the amount shown for the common stock. Accordingly, no separate fee is required for the participation interests. In accordance with Rule 457(h) of the Securities Act of 1933, as amended, the registration fee has been calculated on the basis of the number of shares of common stock that may be purchased with the current assets of such plan.
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THE OFFERING |
1
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Securities Offered
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1
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Election to Purchase Common Stock
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1
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Purchase Priorities
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2
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Minimum and Maximum Investment
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4
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Value of Plan Assets
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4
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How to Order
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4
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Order Deadline
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5
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Irrevocability of Transfer Direction
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6
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Future Direction to Purchase Common Stock
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6
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Voting Rights of Common Stock
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6
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DESCRIPTION OF THE PLAN |
8
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Introduction
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8
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Eligibility and Participation
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8
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Contributions Under the Plan
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9
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Limitations on Contributions
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9
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Benefits Under the Plan
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9
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Withdrawals and Distributions from the Plan
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10
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Investment of Contributions and Account Balances
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11
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Performance History and Description of Funds
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12
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Administration of the Plan
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15
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Amendment and Termination
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15
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Merger, Consolidation or Transfer
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16
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Federal Income Tax Consequences
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16
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Additional Employee Retirement Income Security Act (“ERISA”) Considerations
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17
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Securities and Exchange Commission Reporting and Short-Swing Profit Liability
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17
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Financial Information Regarding Plan Assets
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18
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LEGAL OPINION |
19
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Securities Offered
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Jacksonville Bancorp-Maryland is offering participation interests in shares of common stock of Jacksonville Bancorp-Maryland (“Jacksonville Bancorp-Maryland Common Stock”) acquired by the Jacksonville Savings Bank 401(k) Profit Sharing Plan (the “Plan”). The participation interests represent your indirect ownership of shares of Jacksonville Bancorp-Maryland Common Stock through the Plan. At the purchase price of $10.00 per share, the Plan may acquire up to 630,516 shares of Jacksonville Bancorp-Maryland Common Stock in the stock offering, based on the fair market value of the Plan’s assets as of December 31, 2009.
|
Only employees of Jacksonville Savings Bank may become participants in the Plan and only participants may purchase participation interests in shares of Jacksonville Bancorp-Maryland Common Stock. Your investment in shares of Jacksonville Bancorp-Maryland Common Stock in connection with the stock offering is subject to the purchase priorities listed below. | |
Information with regard to the Plan is contained in this prospectus supplement and information with regard to the financial condition, results of operations and business of Jacksonville Bancorp-Maryland and Jacksonville Savings Bank is contained in the accompanying prospectus. The address of the principal executive office of Jacksonville Bancorp-Maryland and Jacksonville Savings Bank is 1211 West Morton Avenue, P.O. Box 880, Jacksonville, IL 62651-0880. Jacksonville Savings Bank’s telephone number at this address is (217) 245-4111. | |
All questions about this Prospectus Supplement should be addressed to Diana Tone, Chief Financial Officer at Jacksonville Savings Bank; telephone number: (217) 245-4111; email:
dtone@jacksonvillesavings.com
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Questions about the common stock being offered or about the prospectus may be directed to the Stock Information Center at ______________________.
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(6)
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Public stockholders of Jacksonville Bancorp-Federal as of
the close of business on May 10, 2010,
get sixth priority.
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If you fall into subscription offering
categories (1), (3) or (4), you have subscription rights to purchase Jacksonville Bancorp-Maryland Common Stock in the subscription offering and you may use funds in the Plan to pay for the shares of Jacksonville Bancorp-Maryland Common Stock. You may also be able to purchase shares of Jacksonville Bancorp-Maryland Common Stock in the subscription offering even though you are ineligible to purchase through subscription offering categories (1), (3) or (4) if Jacksonville Bancorp-Maryland determines to allow the Plan to purchase stock through subscription offering category (2), reserved for its tax-qualified employee plans. If the Plan is not included in category (2), then any order for shares of Jacksonville Bancorp-Maryland Common Stock placed by those ineligible to subscribe in categories (1), (3), and (4) will be considered an order placed in the community offering to members of the general public. Subscription offering orders, however, will have preference over orders placed in a community offering.
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||
The trustee of the Plan will purchase shares of Jacksonville Bancorp-Maryland Common Stock sold in the stock offering in accordance with your directions. No later than the end of the subscription and community offering period, the amount that you elect to transfer from your existing Plan account balance for the purchase of shares of Jacksonville Bancorp-Maryland Common Stock in connection with the stock offering will be removed from the investment funds you select and transferred to an interest-bearing savings account maintained by Jacksonville Savings Bank as an investment in the Plan , pending the closing of the stock offering. Following the offering period, we will determine whether all, or any portion of, your order will be filled (if the offering is oversubscribed, you may not receive any, or all of, your order, depending on your purchase priority, as described above, and whether the Plan will purchase through category 2). The amount that can be used toward your order will be applied to the purchase of shares of Jacksonville Bancorp-Maryland Common Stock.
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||
In the event the offering is oversubscribed,
i.e.
, there are more orders for Jacksonville Bancorp-Maryland Common Stock than shares available for sale in the offering, and the trustee is unable to use the full amount allocated by you to purchase participation interests in Jacksonville Bancorp-Maryland Common Stock in the offering, the amount that cannot be invested in Jacksonville Bancorp-Maryland Common Stock, and any interest earned on such amount, will be transferred from the interest-bearing savings account maintained by Jacksonville Savings Bank (as an investment in the Plan) and reinvested in the existing investment funds of the Plan, in accordance with your then existing investment election (in proportion to your investment direction for future contributions). The prospectus describes the allocation procedures in the event of an oversubscription. If you choose not to direct the investment of your account balances towards the purchase of any participation interests in Jacksonville Bancorp-Maryland Common Stock sold in the offering, your account balances will remain in the investment options of the Plan as previously directed by you.
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Minimum and Maximum Investment
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In connection with the stock offering, the Plan will permit you to direct the trustee to transfer all, or part of, your assets in the Plan to be used to purchase participation interests in Jacksonville Bancorp-Maryland Common Stock sold in the offering. The trustee of the Plan will then subscribe for shares of Jacksonville Bancorp-Maryland Common Stock offered for sale in the offering, in accordance with each participant’s direction. The trustee will pay $10.00 per share, which will be the same price paid by all other persons who purchase shares in the subscription and community offerings. In order to purchase participation interests in Jacksonville Bancorp-Maryland Common Stock through the Plan, the minimum investment is $250, which will purchase 25 shares. The maximum investment any individual can make through the Plan and outside the Plan is $250,000, which will purchase 25,000 shares.
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Value of Plan Assets
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As of December 31, 2009, the market value of the assets of the Plan was approximately $ 6,305,169 , which is eligible to purchase Jacksonville Bancorp-Maryland Common Stock in the offering. The Plan administrator informed each participant of the value of his or her account balance under the Plan as of December 31, 2009.
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How to Order
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Enclosed is a Special Investment Election Form on which you can elect to purchase participation interests in Jacksonville Bancorp-Maryland Common Stock sold in the offering. Please note the following stipulations concerning this election:
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●
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You can direct all or a portion of your current Plan account to purchase Jacksonville Bancorp-Maryland Common Stock in increments of $10.00.
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●
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Your election is subject to a minimum purchase of 25 shares, which equals $250.
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●
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Your election, plus any order you placed outside the Plan, are together subject to a maximum purchase of 25,000 shares, which equals $250,000.
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●
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The election period opens ______________, 2010 and closes __________________ p.m., ____________ Time, on ______________________, 2010.
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●
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During the stock offering period, you will not be permitted to change the investment amounts that you designated to be used to purchase shares of Jacksonville Bancorp-Maryland Common Stock on your Special Investment Election Form.
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●
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After the election period ends, the dollar amounts you designated will be transferred to an interest-bearing savings account maintained by Jacksonville Savings Bank. If you elect to transfer a dollar amount from a particular investment option under the Plan and, at the time that the transfer is made, you do
not
have a sufficient dollar amount in that investment option to process your entire election due to market fluctuation, the trustee will withdraw up to 100% of your balance in that investment option (rounded down to the nearest $10.00 increment) and apply only the amount withdrawn to the purchase of shares of Jacksonville Bancorp-Maryland Common Stock for your Plan account.
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●
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The amount transferred to the interest-bearing savings account maintained by Jacksonville Savings Bank will be held separately until the offering closes. Therefore, this money is not available for distributions, loans, or withdrawals until the transaction is completed, which is after the closing of the subscription offering period.
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If you wish to use all or part of your account balance in the Plan to purchase participation interests in shares of Jacksonville Bancorp-Maryland Common Stock issued in the stock offering, you should indicate that decision on the Special Investment Election Form.
If you do not wish to make an election, you should check the box at the bottom of the Special Investment Election Form and return the form to _Diana Tone, Chief Financial Officer, at Jacksonville Savings Bank, 1211 West Morton Avenue, P.O. Box 880, Jacksonville, Illinois 62651-0880 or by faxing it to (217)- 245-2010, by no later than ________ p.m., ____________ Central Time, on ___________.
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Order Deadline
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If you wish to purchase participation interests in shares of Jacksonville Bancorp-Maryland Common Stock with all or a part of your Plan account balance,
you must return your Special Investment Election Form to Diana Tone, Chief Financial Officer, at Jacksonville Savings Bank,
1211 West Morton Avenue, P.O. Box 880, Jacksonville, Illinois 62651-0880 or by faxing it to (217)-245-2010, by no later than _______ p.m. ____________ , Central Time, on _________, 2010. You may return your Special Investment Election Form by hand delivery, mail or by faxing it so long as it is returned by the time specified.
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Voting Rights of Common Stock
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The Plan provides that you may direct the trustee as to how to vote any shares of Jacksonville Bancorp-Maryland Common Stock held by the Plan, and the interest in such shares that is credited to your account. If the trustee does not receive your voting instructions, the Plan administrator will exercise these rights as it determines in its discretion and will direct the trustee accordingly. All voting instructions will be kept confidential.
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1.
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Jacksonville Savings Bank Certificate of Deposit (CD)
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2.
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The Bond Fund of America
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3.
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American Balanced Fund
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4.
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The Income Fund of America
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5.
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Capital World Growth and Income Fund
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6.
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Fundamental Investors
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7.
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The Investment Company of America
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8.
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Washington Mutual Investors Fund
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9.
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AMCAP Fund
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10.
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New Perspective Fund
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11.
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SMALLCAP World Fund
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12.
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The Growth Fund of America
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13.
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American Funds Target Date Retirement 2010
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14.
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American Funds Target Date Retirement 2015
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15.
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American Funds Target Date Retirement 2020
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16.
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American Funds Target Date Retirement 2025
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17.
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American Funds Target Date Retirement 2030
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18.
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American Funds Target Date Retirement 2035
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19.
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American Funds Target Date Retirement 2040
|
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20.
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American Funds Target Date Retirement 2045
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21.
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American Funds Target Date Retirement 2050
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22.
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Jacksonville Bancorp-Federal Common Stock
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Performance
as of December 31, 2009
|
||||||||||||||||||||
Fund
|
Total Return
YTD
1
|
Total Return
1 Yr
1
|
Total Return
Annualized
3 Yrs
1
|
Total Return
Annualized
5 Yrs
1
|
Total Return
Annualized 10 Yrs
1
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|||||||||||||||
Jacksonville Savings Bank CD
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n/a | n/a | n/a | n/a | n/a | |||||||||||||||
American Balanced Fund
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21.08 | % | 21.08 | % | -1.40 | % | 2.02 | % | 5.68 | % | ||||||||||
The Income Fund of America
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24.51 | % | 24.51 | % | -2.77 | % | 2.72 | % | 6.01 | % | ||||||||||
Capital World Growth and Income Fund
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32.25 | % | 32.25 | % | -1.43 | % | 6.10 | % | 7.16 | % | ||||||||||
Fundamental Investors
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33.36 | % | 33.36 | % | -2.98 | % | 3.99 | % | 3.61 | % | ||||||||||
The Investment Company of America
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27.18 | % | 27.18 | % | -4.19 | % | 1.73 | % | 2.50 | % | ||||||||||
Washington Mutual Investors Fund
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18.99 | % | 18.99 | % | -6.11 | % | 0.23 | % | 2.81 | % | ||||||||||
AMCAP Fund
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39.21 | % | 39.21 | % | -2.30 | % | 1.62 | % | 2.51 | % | ||||||||||
New Perspective Fund
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37.43 | % | 37.43 | % | -0.29 | % | 5.75 | % | 3.97 | % | ||||||||||
SMALLCAP World Fund
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53.49 | % | 53.49 | % | -3.10 | % | 5.45 | % | 2.28 | % | ||||||||||
The Growth Fund of America
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34.48 | % | 34.48 | % | -3.13 | % | 2.87 | % | 2.34 | % | ||||||||||
American Funds 2010 Target Date
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23.34 | % | 23.34 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2015 Target Date
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24.59 | % | 24.59 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2020 Target Date
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26.79 | % | 26.79 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2025 Target Date
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29.44 | % | 29.44 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2030 Target Date
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31.07 | % | 31.07 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2035 Target Date
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31.34 | % | 31.34 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2040 Target Date
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31.55 | % | 31.55 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2045 Target Date
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31.56 | % | 31.56 | % | n/a | n/a | n/a | |||||||||||||
American Funds 2050 Target Date
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31.63 | % | 31.63 | % | n/a | n/a | n/a | |||||||||||||
Jacksonville Bancorp-Federal Common Stock
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29.00 | % 2 | 29.00 | % 2 | -4.00 | % 2 | -5.00 | % 2 | -5.50 | % 2 |
(1)
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the sponsoring employer is allowed an immediate tax deduction for the amount contributed to the Plan each year;
|
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(2)
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participants pay no current income tax on amounts contributed by the employer on their behalf; and
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(3)
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earnings of the Plan are tax-deferred, thereby permitting the tax-free accumulation of income and gains on investments.
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●
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You may have priority rights to purchase shares of common stock.
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●
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Each of your shares of common stock will be exchanged at the conclusion of the offering for between 0.9615 and 1.3009 shares (subject to adjustment to up to 1.4960 shares) of common stock of Jacksonville Bancorp-Maryland.
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●
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Your percentage ownership will remain the same as your current percentage ownership interest in Jacksonville Bancorp-Federal, exclusive of additional shares that you may purchase in the offering and your receipt of cash in lieu of fractional exchange shares.
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●
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You may have the opportunity to purchase additional shares of common stock in the subscription offering , based on your priority rights as a depositor, or in the community offering after priority orders are filled.
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●
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You may have the opportunity to purchase shares of common stock after priority orders are filled.
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Minimum
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Midpoint
|
Maximum
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Adjusted
Maximum
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|||||||||||||
Number of shares:
|
998,750 | 1,175,000 | 1,351,250 | 1,553,938 | ||||||||||||
Gross offering proceeds:
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$ | 9,987,500 | $ | 11,750,000 | $ | 13,512,500 | $ | 15,539,375 | ||||||||
Estimated offering expenses, excluding
selling agent commissions and expenses:
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$ | 912,500 | $ | 912,500 | $ | 912,500 | $ | 912,500 | ||||||||
Selling agent commissions and expenses (1):
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$ | 328,679 | $ | 373,888 | $ | 419,096 | $ | 471,085 | ||||||||
Estimated net proceeds:
|
$ | 8,746,321 | $ | 10,463,613 | $ | 12,180,904 | $ | 14,155,790 | ||||||||
Estimated net proceeds per share:
|
$ | 8.76 | $ | 8.91 | $ | 9.01 | $ | 9.11 |
(1)
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For information regarding compensation to be received by Keefe, Bruyette & Woods, Inc. and the other broker-dealers that may participate in the syndicated community offering, including the assumptions regarding the number of shares that may be sold in the subscription and community offerings and the syndicated community offering to determine the estimated offering expenses, see “Pro Forma Data” on page ___ and “The Conversion and Offering—
—
Plan of Distribution; Selling Agent Compensation ” on page ____.
|
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34
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41
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45
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165
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167
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167
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167
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167
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||
JACKSONVILLE BANCORP-FEDERAL INDEX TO CONSOLIDATED FINANCIAL
STATEMENTS
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F -1 |
●
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remaining a community-oriented financial institution;
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●
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increasing our commercial and agricultural real estate lending;
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●
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operating our business profitability while managing risks;
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●
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increasing our share of lower-cost deposits; and
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●
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increasing and diversifying our sources of non-interest income.
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●
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to increase our capital to support internal growth through lending in the communities we serve;
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●
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to enhance existing products and services and support the development of new products and services;
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●
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to facilitate growth through branch and whole bank acquisitions, as opportunities arise;
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●
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to improve our overall competitive position; and
|
●
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to improve the liquidity of our shares of common stock and enhance stockholder returns through more flexible capital management strategies.
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(i)
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First, to depositors with accounts at Jacksonville Savings Bank with aggregate balances of at least $50.00 at the close of business on December 31, 2008.
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(ii)
|
Second, to Jacksonville Savings Bank’s tax-qualified employee benefit plans, including our employee stock ownership plan and 401(k) plan, who will receive, without payment therefor, nontransferable subscription rights to purchase in the aggregate up to 10% of the shares of common stock sold in the offering. Our employee stock ownership plan currently intends to purchase up to 4% of the shares of common stock sold in the offering, with the remaining shares in this purchase priority allocated to our 401(k) plan.
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(iii)
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Third, to depositors with accounts at Jacksonville Savings Bank with aggregate balances of at least $50.00 at the close of business on March 31, 2010.
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(iv)
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Fourth, to depositors of Jacksonville Savings Bank at the close of business on May 10, 2010.
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Company Name and Ticker Symbol
|
Exchange
|
Headquarters
|
Total Assets
|
|||||
(in millions)
|
||||||||
Citizens Community Bancorp, Inc. (CZWI)
|
NASDAQ
|
Eau Claire, WI
|
$ | 567 | ||||
FFD Financial Corp. (FFDF)
|
NASDAQ
|
Dover, OH
|
198 | |||||
First Capital, Inc. (FCAP)
|
NASDAQ
|
Corydon, IN
|
457 | |||||
First Savings Financial Group (FSFG)
|
NASDAQ
|
Clarksville, IN
|
491 | |||||
HopFed Bancorp, Inc. (HFBC)
|
NASDAQ
|
Hopkinsville, KY
|
1,022 | |||||
Liberty Bancorp, Inc. (LBCP)
|
NASDAQ
|
Liberty, MO
|
406 | |||||
LSB Financial Corp. (LSBI)
|
NASDAQ
|
Lafayette, IN
|
364 | |||||
River Valley Bancorp (RIVR)
|
NASDAQ
|
Madison, IN
|
385 | |||||
Wayne Savings Bancshares (WAYN)
|
NASDAQ
|
Wooster, OH
|
403 | |||||
WVS Financial Corp. (WVFC)
|
NASDAQ
|
Pittsburgh, PA
|
392 |
●
|
average assets of $469 million;
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●
|
average non-performing assets of 1.72% of total assets;
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●
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average loans of 68.2% of total assets;
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●
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average equity of 9.15% of total assets; and
|
●
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average net income of 0.27% of average assets.
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Price-to- earnings
multiple
(1)
|
Price-to-book
value ratio
|
Price-to-tangible
book value ratio
|
||||||||||
Jacksonville Bancorp-Maryland (on a pro forma basis, assuming completion of the conversion)
|
||||||||||||
Adjusted Maximum
|
25.36x | 72.52 | % | 77.88 | % | |||||||
Maximum
|
22.61x | 66.23 | % | 71.38 | % | |||||||
Midpoint
|
20.09x | 60.20 | % | 65.15 | % | |||||||
Minimum
|
17.47x | 53.65 | % | 58.28 | % | |||||||
Valuation of peer group companies, all of which are fully converted (on an historical basis)
|
||||||||||||
Averages
|
18.92x | 63.46 | % | 66.79 | % | |||||||
Medians
|
17.70x | 62.98 | % | 65.09 | % |
(1)
|
Price-to-earnings multiples calculated by RP Financial, LC. in the independent appraisal are based on an estimate of “core,” or recurring, earnings. These ratios are different than those presented in “Pro Forma Data.”
|
|
||||||||||||||||||||||||
Dilution
Resulting
From
Issuance of
Shares for
Stock-Based
Benefit plans
(3)
|
||||||||||||||||||||||||
Number of Shares to be Granted or Purchased (1)
|
||||||||||||||||||||||||
As a
Percentage
of Common
Stock to be
Sold in the
Offering
|
Value of Grants, in Thousands (2) | |||||||||||||||||||||||
At
Minimum of
Offering
Range
|
At
Maximum
as adjusted
of Offering
Range
|
At
Minimum
of
Offering
Range
|
At
Maximum,
as
adjusted,
of Offering
Range
|
|||||||||||||||||||||
Employee stock ownership plan
|
39,950 | 62,158 | 4.0 | % | 0.00 | % | $ | 400 | $ | 622 | ||||||||||||||
Stock options
|
99,875 | 155,394 | 10.0 | 5.13 | % | 222 | 345 | |||||||||||||||||
Total
|
139,825 | 217,552 | 14.0 | % | 5.13 | % | $ | 622 | $ | 967 |
(1)
|
The table assumes that the stock-based benefit plan awards a number of options equal to 10% of the shares of common stock sold in the offering as if the plan is implemented within one year after the completion of the conversion and offering. If the stock-based benefit plan is implemented more than 12 months after the completion of the conversion and offering, grants of options may exceed these percentage limitations.
|
(2)
|
For purposes of this table, fair value for stock awards is assumed to be the same as the offering price of $10.00 per share. The fair value of stock options has been estimated at $2.22 per option using the Black-Scholes option pricing model, adjusted for the exchange ratio, with the following assumptions: a grant-date share price and option exercise price of $10.00; an expected option life of ten years; a dividend yield of 3.0%; a risk-free interest rate of 3.85%; and a volatility rate of 21.42%. The actual value of option grants will be determined by the grant-date fair value of the options, which will depend on a number of factors, including the valuation assumptions used in the option pricing model ultimately adopted.
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(3)
|
Represents the dilution of stock ownership interest. No dilution is reflected for the employee stock ownership plan because such shares are assumed to be purchased in the offering.
|
Existing and New Stock Benefit Plans
|
Participants
|
Shares at Maximum
of Offering Range
|
Estimated Value of
Shares
|
Percentage of
Shares Outstanding
After the
Conversion
|
||||||||||
Employee Stock Ownership Plan:
|
Employees
|
|||||||||||||
Shares purchased in 1995 offering (1)
|
87,031 | (2) | $ | 870,310 | 3.5 | % | ||||||||
Shares to be purchased in this offering
|
54,050 | 540,500 | 2.2 | |||||||||||
Total employee stock ownership plan shares
|
141,081 | $ | 1,410,810 | 5.7 | % | |||||||||
Restricted Stock Awards:
|
Directors and Officers
|
|||||||||||||
1996 Recognition and Retention Plan(1)
|
43,515 | (3) | $ | 435,150 | (4) | 1.7 | % | |||||||
Total shares of restricted stock
|
43,515 | $ | 435,150 | 1.7 | % | |||||||||
Stock Options:
|
Directors and Officers
|
|||||||||||||
1996 Stock Option Plan (1)
|
108,787 | (5) | $ | 1,087,870 | 4.4 | % | ||||||||
2001 Stock Option Plan (1)
|
111,877 | (6) | 1,118,770 | 4.5 | ||||||||||
New stock options
|
135,125 | $ | 1,351,250 | (7) | 5.4 | |||||||||
Total stock options
|
355,789 | $ | 3,557,890 | 14.3 | % (8) | |||||||||
Total of stock benefit plans
|
540,385 | $ | 5,403,850 | 21.7 | % |
(2)
|
As of December 31, 2009, all of these shares, or 66,901 shares prior to adjustment for the exchange, have been allocated.
|
(3)
|
As of December 31, 2009, all of these shares, or 33,450 shares prior to adjustment for the exchange, have been awarded, and all of the shares prior to adjustment for the exchange, have vested.
|
(4)
|
The value of restricted stock awards is determined based on their fair value as of the date grants are made. For purposes of this table, the fair value of awards under the new stock-based benefit plan is assumed to be the same as the offering price of $10.00 per share.
|
(5)
|
As of December 31, 2009, options to purchase 108,787 of these shares, or 83,625 shares prior to adjustment for the exchange, have been awarded, and no options remain available for future grants. At December 31, 2009, 4,500 unexercised and fully vested options were outstanding under this plan prior to adjustment for the exchange.
|
(6)
|
As of December 31, 2009, options to purchase 111,877 of these shares, or 86,000 shares prior to adjustment for the exchange, have been awarded, and options to purchase 1,430 of these shares, or 1,100 shares prior to adjustment for the exchange, remain available for future grants. At December 31, 2009, 28,845 unexercised and fully vested options were outstanding under this plan prior to adjustment for the exchange.
|
(7)
|
The weighted-average fair value of stock options has been estimated at $2.22 per option, adjusted for the exchange rate, using the Black-Scholes option pricing model. The fair value of stock options uses the Black-Scholes option pricing model with the following assumptions: exercise price, $10.00; trading price on date of grant, $10.00; dividend yield, 3.00%; expected life, 10 years; expected volatility, 21.42%; and risk-free interest rate, 3.85%.
|
(8)
|
The number of stock options set forth in the table would exceed regulatory limits if a stock-based benefit plan was adopted within one year of the completion of the conversion. Accordingly, the number of new stock options set forth in the table would have to be reduced such that the aggregate amount of stock options would be 10% or less, unless we obtain a waiver from the Office of Thrift Supervision, or we implement the plan after twelve months following the completion of the conversion. Our current intention is to implement a new stock-based benefit plan no earlier than twelve months after completion of the conversion.
|
Exercise Price |
Grant-Date Fair
Value Per Option
|
99,875
Options at
Minimum of Range
|
117,500
Options at
Midpoint of Range
|
135,125
Options at
Maximum of Range
|
155,394
Options at
Maximum of
Range, As Adjusted
|
|||||||||||||||||
$ |
8.00
|
$ | 1.78 | $ | 177,778 | $ | 209,150 | $ | 240,523 | $ | 276,601 | |||||||||||
10.00
|
2.22 | 221,723 | 260,850 | 299,978 | 344,975 | |||||||||||||||||
12.00
|
2.66 | 265,668 | 312,550 | 359,433 | 413,348 | |||||||||||||||||
14.00
|
3.11 | 310,611 | 365,425 | 420,239 | 483,275 |
Shares to be Sold in This
Offering
|
Shares of Jacksonville Bancorp-
Maryland to be Issued for
Shares of Jacksonville Bancorp-
Federal
|
Total Shares of
Common Stock
to be Issued in
Conversion and
Offering
|
Exchange Ratio |
Equivalent
Value of Shares
Based Upon
Current Market
Price
(1)
|
Shares to be
Received
for 100
Existing
Shares
|
||||||||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
||||||||||||||||||||||||||||||
Minimum
|
998,750 | 54.08 | % | 848,122 | 45.92 | % | 1,846,872 | 0.9615 | $ | 9.62 | 96 | ||||||||||||||||||||||
Midpoint
|
1,175,000 | 54.08 | 997,790 | 45.92 | 2,172,790 | 1.1312 | 11.31 | 113 | |||||||||||||||||||||||||
Maximum
|
1,351,250 | 54.08 | 1,147,459 | 45.92 | 2,498,709 | 1.3009 | 13.01 | 130 | |||||||||||||||||||||||||
15% above Maximum
|
1,553,938 | 54.08 | 1,319,578 | 45.92 | 2,873,515 | 1.4960 | 14.96 | 149 |
●
|
your spouse or relatives of you or your spouse living in your house;
|
●
|
most companies, trusts or other entities in which you are a trustee, have a substantial beneficial interest or hold a senior position; or
|
●
|
other persons who may be your associates or persons acting in concert with you.
|
(i)
|
personal check, bank check or money order made payable directly to Jacksonville Bancorp, Inc.; or
|
(ii)
|
authorizing us to withdraw funds from Jacksonville Savings Bank savings and certificate of deposit accounts (not checking accounts) designated on the stock order form.
|
|
(i)
|
increase the purchase and ownership limitations;
|
|
(ii)
|
seek regulatory approval to extend the offering beyond the [extension date] expiration date, provided that any such extension will require us to resolicit subscriptions received in the offering; and/or
|
(iii)
|
Increase the purchase of shares by the employee stock ownership plan.
|
●
|
The plan of conversion and reorganization is approved by at least
a majority of votes eligible
to be cast by members of Jacksonville Bancorp, MHC;
|
●
|
The plan of conversion and reorganization is approved by at least
two-thirds of the outstanding
shares of common stock of Jacksonville Bancorp-Federal as of _______________, including shares held by Jacksonville Bancorp, MHC. (Because Jacksonville Bancorp, MHC owns 54.1% of the outstanding shares of Jacksonville Bancorp-Federal common stock, Jacksonville Bancorp, MHC and its executive officers and directors will significantly influence the outcome of this vote);
|
●
|
The plan of conversion and reorganization is approved by at least
a majority of the outstanding
shares of common stock of Jacksonville Bancorp-Federal as of _______________, excluding those shares held by Jacksonville Bancorp, MHC;
|
●
|
We sell at least the minimum number of shares of common stock offered; and
|
●
|
We receive the final approval of the Office of Thrift Supervision to complete the conversion and offering; however, such approval does not constitute a recommendation or endorsement of the plan of conversion and reorganization by that agency.
|
●
|
demand for our products and services may decline;
|
●
|
loan delinquencies, problem assets and foreclosures may increase;
|
●
|
collateral for our loans may continue to decline in value; and
|
●
|
the amount of our low-cost or non-interest bearing deposits may decrease.
|
●
|
Office of Thrift Supervision Regulations
.
Office of Thrift Supervision regulations prohibit, for three years following the completion of a conversion, the direct or indirect acquisition of more than 10% of any class of equity security of a savings and loan holding company regulated by the Office of Thrift Supervision without the prior approval of the Office of Thrift Supervision.
|
●
|
Articles of incorporation of Jacksonville Bancorp-Maryland and statutory provisions.
Provisions of the articles of incorporation and bylaws of Jacksonville Bancorp-Maryland and Maryland law may make it more difficult and expensive to pursue a takeover attempt that management opposes, even if the takeover is favored by a majority of our stockholders. These provisions also would make it more difficult to remove our current board of directors or management, or to elect new directors. Specifically, under Sections 3-601 through 3-605 of the Maryland General Corporation Law , any person who acquires more than 10% of the common stock of Jacksonville Bancorp-Maryland without the prior approval of its board of directors would be prohibited from engaging in any type of business combination with Jacksonville Bancorp-Maryland for a five-year period. Any business combination after the five year prohibition would be subject to super-majority stockholder approval or minimum price requirements. Additional provisions include limitations on voting rights of beneficial owners of more than 10% of our common stock, the election of directors to staggered terms of three years and not permitting cumulative voting in the election of directors. Our bylaws also contain provisions regarding the timing and content of stockholder proposals and nominations and qualification for service on the board of directors.
|
●
|
Articles of incorporation of Jacksonville Savings Bank.
The articles of incorporation of Jacksonville Savings Bank will provide that for a period of five years from the closing of the conversion and offering, no person other than Jacksonville Bancorp-Maryland may offer directly or indirectly to acquire the beneficial ownership of more than 10% of any class of equity security of Jacksonville Savings Bank. This provision will not apply to any tax-qualified employee benefit plan of Jacksonville Savings Bank or Jacksonville Bancorp-Maryland or to an underwriter or member of an underwriting or selling group involving the public sale or resale of securities of Jacksonville Bancorp-Maryland or any of its subsidiaries, so long as after the sale or resale, no underwriter or member of the selling group is a beneficial owner, directly or indirectly, of more than 10% of any class of equity securities of Jacksonville Savings Bank. In addition, during this five-year period, all shares owned over the 10% limit may not be voted on any matter submitted to stockholders for a vote.
|
●
|
Issuance of stock options
.
We also intend to grant stock options to key employees and directors that will require payments to these persons in the event of a change in control of Jacksonville Bancorp-Maryland. These payments may have the effect of increasing the costs of acquiring Jacksonville Bancorp-Maryland, thereby discouraging future takeover attempts.
|
●
|
Employment and change in control agreements
.
Jacksonville Bancorp-Federal has employment agreements with certain of its executive officers that will remain in effect following the stock offering. Jacksonville Bancorp-Maryland intends to enter into a change in control agreement with its Chief Financial Officer following the stock offering. These agreements may have the effect of increasing the costs of acquiring Jacksonville Bancorp-Maryland, thereby discouraging future takeover attempts.
|
At December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Selected Financial Condition Data:
|
||||||||||||||||||||
Total assets
|
$ | 288,846 | $ | 288,275 | $ | 288,489 | $ | 267,372 | $ | 253,946 | ||||||||||
Cash and cash equivalents
|
15,696 | 7,145 | 12,175 | 9,331 | 6,681 | |||||||||||||||
Investment securities
|
38,455 | 50,988 | 66,295 | 79,978 | 80,821 | |||||||||||||||
Mortgage-backed securities
|
40,984 | 27,795 | 15,415 | 8,210 | 8,646 | |||||||||||||||
Loans, net
(1)
|
17 3,683 | 18 2,948 | 17 5,867 | 15 4,838 | 14 2,272 | |||||||||||||||
Federal Home Loan Bank of Chicago stock, at cost
|
1,109 | 1,109 | 1,109 | 1,109 | 1,539 | |||||||||||||||
Foreclosed assets, net
|
383 | 769 | 364 | 152 | 456 | |||||||||||||||
Bank owned life insurance
|
4,095 | 3,907 | 3,186 | 334 | 311 | |||||||||||||||
Deposits
|
254,700 | 238,151 | 245,721 | 232,913 | 218,370 | |||||||||||||||
Federal Home Loan Bank of Chicago advances
|
— | 13,500 | 10,000 | 4,000 | 8,000 | |||||||||||||||
Short-term borrowings
|
3,789 | 7,633 | 4,936 | 5,035 | 3,350 | |||||||||||||||
Stockholders’ equity
|
25,263 | 24,259 | 22,618 | 21,145 | 20,103 |
For the Years Ended December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(In thousands, except per share amounts)
|
||||||||||||||||||||
Selected Operating Data:
|
||||||||||||||||||||
Interest income
|
$ | 14,420 | $ | 15,908 | $ | 15,609 | $ | 13,978 | $ | 12,423 | ||||||||||
Interest expense
|
5,432 | 7,716 | 9,056 | 7,031 | 4,986 | |||||||||||||||
Net interest income
|
8,988 | 8,192 | 6,553 | 6,947 | 7,437 | |||||||||||||||
Provision for loan losses
|
2,575 | 310 | 155 | 60 | 245 | |||||||||||||||
Net interest income after provision for loan losses
|
6,413 | 7,882 | 6,398 | 6,887 | 7,192 | |||||||||||||||
Noninterest income
|
4,209 | 3,161 | 2,492 | 2,235 | 2,174 | |||||||||||||||
Noninterest expense
|
9,126 | 9,221 | 8,261 | 7,893 | 8,054 | |||||||||||||||
Income before income tax
|
1,497 | 1,822 | 629 | 1,229 | 1,312 | |||||||||||||||
Provision for income taxes
|
101 | 304 | 10 | 334 | 412 | |||||||||||||||
Net income
|
$ | 1,396 | $ | 1,518 | $ | 619 | $ | 895 | $ | 900 | ||||||||||
Earnings per share:
|
||||||||||||||||||||
Basic
|
$ | 0.72 | $ | 0.76 | $ | 0.31 | $ | 0.45 | $ | 0.46 | ||||||||||
Diluted
|
$ | 0.72 | $ | 0.76 | $ | 0.31 | $ | 0.45 | $ | 0.45 | ||||||||||
Dividends per share
|
$ | 0.30 | $ | 0.30 | $ | 0.30 | $ | 0.30 | $ | 0.30 |
(1)
|
Excludes loans held for sale of $814,000, $1.4 million, $1.9 million, $426,000 and $499,000 at December 31, 2009, 2008, 2007, 2006 and 2005, respectively.
|
At or For the Years Ended December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
Selected Financial Ratios and Other Data:
|
||||||||||||||||||||
Performance Ratios:
|
||||||||||||||||||||
Return on average assets (ratio of net income to average total assets)
|
0.47 | % | 0.52 | % | 0.22 | % | 0.35 | % | 0.36 | % | ||||||||||
Return on average equity (ratio of net income to average equity)
|
5.69 | % | 6.59 | % | 2.86 | % | 4.37 | % | 4.44 | % | ||||||||||
Interest rate spread
(1)
|
3.08 | % | 2.70 | % | 2.15 | % | 2.48 | % | 2.99 | % | ||||||||||
Net interest margin
(2)
|
3.30 | % | 3.01 | % | 2.53 | % | 2.85 | % | 3.18 | % | ||||||||||
Efficiency ratio
(3)
|
69.15 | % | 81.22 | % | 91.33 | % | 85.97 | % | 83.80 | % | ||||||||||
Dividend pay-out ratio
(4)
|
18.96 | % | 18.75 | % | 45.94 | % | 31.69 | % | 30.98 | % | ||||||||||
Non-interest expense to average total assets
|
3.10 | % | 3.14 | % | 2.95 | % | 3.05 | % | 3.19 | % | ||||||||||
Average interest-earning assets to average
interest-bearing liabilities
|
111.14 | % | 110.66 | % | 110.69 | % | 112.81 | % | 109.07 | % | ||||||||||
Average equity to average total assets
|
8.33 | % | 7.85 | % | 7.79 | % | 7.90 | % | 8.03 | % | ||||||||||
Asset Quality Ratios:
|
||||||||||||||||||||
Non-performing assets to total assets
|
0.81 | % | 0.68 | % | 0.51 | % | 0.56 | % | 0.65 | % | ||||||||||
Non-performing loans to total loans
|
1.11 | % | 0.64 | % | 0.61 | % | 0.86 | % | 0.82 | % | ||||||||||
Allowance for loan losses to non-performing loans
|
117.20 | % | 162.47 | % | 161.90 | % | 137.90 | % | 156.75 | % | ||||||||||
Allowance for loan losses to total loans
(5)
|
1.30 | % | 1.05 | % | 0.99 | % | 1.19 | % | 1.28 | % | ||||||||||
Capital Ratios:
|
||||||||||||||||||||
Total capital (to risk-weighted assets)
|
11.83 | % | 10.94 | % | 11.32 | % | 12.34 | % | 12.83 | % | ||||||||||
Tier I capital (to risk-weighted assets)
|
10.70 | % | 10.02 | % | 10.38 | % | 11.25 | % | 11.66 | % | ||||||||||
Tier I capital (to total assets)
|
7.44 | % | 7.30 | % | 7.02 | % | 7.45 | % | 7.31 | % | ||||||||||
Other Data:
|
||||||||||||||||||||
Number of full service offices
|
7 | 7 | 7 | 7 | 7 | |||||||||||||||
Full time equivalent employees
|
110 | 110 | 114 | 115 | 116 |
(1)
|
The interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted- average cost of interest-bearing liabilities for the period.
|
(2)
|
The net interest margin represents net interest income as a percent of average interest-earning assets for the period.
|
(3)
|
The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income.
|
(4)
|
The dividend payout ratio represents dividends declared per share divided by net income per share. The following table sets forth total cash dividends paid per year, which is calculated by multiplying the dividends declared per share by the number of shares outstanding as of the applicable record date .
|
For the Year Ended December 31
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(In Thousands)
|
||||||||||||||||||||
Dividends paid to public stockholders
|
$ | 265 | $ | 285 | $ | 284 | $ | 284 | $ | 279 | ||||||||||
Dividends paid to Jacksonville Bancorp, MHC
|
— | — | — | — | — | |||||||||||||||
Total dividends paid
|
$ | 265 | $ | 285 | $ | 284 | $ | 284 | $ | 279 | ||||||||||
Total dividends waived by Jacksonville Bancorp, MHC
|
$ | 312 | $ | 312 | $ | 312 | $ | 312 | $ | 312 | ||||||||||
Total dividends paid and total dividends waived by Jacksonville Bancorp, MHC
|
$ | 577 | $ | 597 | $ | 596 | $ | 596 | $ | 591 |
(5)
|
Total loans exclude loans held for sale.
|
At
March 31,
2010
|
At
December 31,
2009
|
|||||||
(In thousands)
|
||||||||
Selected Financial Condition Data:
|
||||||||
Total assets
|
$ | 289,432 | $ | 288,846 | ||||
Cash and cash equivalents
|
14,792 | 15,696 | ||||||
Investment securities
|
46,710 | 37,346 | ||||||
Mortgage-backed securities
|
36,642 | 40,984 | ||||||
Loans, net
(1)
|
170,669 | 173,683 | ||||||
Federal Home Loan Bank of Chicago stock, at cost
|
1,109 | 1,109 | ||||||
Foreclosed assets, net
|
629 | 383 | ||||||
Bank owned life insurance
|
4,145 | 4,095 | ||||||
Deposits
|
255,138 | 254,700 | ||||||
Short-term borrowings
|
3,280 | 3,789 | ||||||
Stockholders’ equity
|
25,587 | 25,263 |
For The Three Months
Ended March 31,
|
||||||||
2010
|
2009
|
|||||||
(In thousands, except per
share amounts)
|
||||||||
Selected Operating Data:
|
||||||||
Interest income
|
$ | 3,234 | $ | 3,774 | ||||
Interest expense
|
1,055 | 1,491 | ||||||
Net interest income
|
2,179 | 2,283 | ||||||
Provision for loan losses
|
275 | 350 | ||||||
Net interest income after provision for loan losses
|
1,904 | 1,933 | ||||||
Noninterest income
|
951 | 905 | ||||||
Noninterest expense
|
2,247 | 2,216 | ||||||
Income before income tax
|
608 | 622 | ||||||
Provision for income taxes
|
109 | 121 | ||||||
Net income
|
$ | 499 | $ | 501 | ||||
Earnings per share:
|
||||||||
Basic
|
$ | 0.26 | $ | 0.26 | ||||
Diluted
|
$ | 0.26 | $ | 0.26 | ||||
Dividends per share
|
$ | 0.08 | $ | 0.08 |
(1)
|
Excludes loans held for sale of $150,000 and $814,000 at March 31, 2010 and December 31, 2009, respectively.
|
At or For the Three
Months Ended
March 31,
|
|||||||||
2010
|
2009
|
||||||||
Selected Financial Ratios and Other Data:
|
|||||||||
Performance Ratios:
|
|||||||||
Return on average assets (ratio of net income to average total assets)
(1)
|
0.70 | % | 0.68 | % | |||||
Return on average equity (ratio of net income to average equity)
(1)
|
7.85 | % | 8.26 | % | |||||
Interest rate spread
(2)
|
3.13 | % | 3.15 | % | |||||
Net interest margin
(1)(3)
|
3.31 | % | 3.40 | % | |||||
Efficiency ratio
(4)
|
71.80 | % | 69.49 | % | |||||
Dividend pay-out ratio
(5)
|
13.26 | % | 13.21 | % | |||||
Non-interest expense to average total assets
(1)
|
3.15 | % | 3.02 | % | |||||
Average interest-earning assets to average
interest-bearing liabilities
|
111.43 | % | 111.27 | % | |||||
Average equity to average total assets
|
8.90 | % | 8.28 | % | |||||
Asset Quality Ratios:
|
|||||||||
Non-performing assets to total assets
|
1.02 | % | 0.67 | % | |||||
Non-performing loans to total loans
|
1.33 | % | 0.90 | % | |||||
Allowance for loan losses to non-performing loans
|
110.62 | % | 138.01 | % | |||||
Allowance for loan losses to total loans
|
1.48 | % | 1.25 | % | |||||
Capital Ratios:
|
|||||||||
Total capital (to risk-weighted assets)
|
12.23 | % | 11.07 | % | |||||
Tier I capital (to risk-weighted assets)
|
10.98 | % | 9.97 | % | |||||
Tier I capital (to average assets)
|
7.79 | % | 7.18 | % | |||||
Other Data:
|
|||||||||
Number of full service offices
|
4 | 4 | |||||||
Full time equivalent employees
|
106 | 109 |
|
(1)
|
Annualized.
|
|
(2)
|
The interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the period.
|
|
(3)
|
The net interest margin represents net interest income as a percent of average interest-earning assets for the period.
|
|
(4)
|
The efficiency ratio represents non-interest expense divided by the sum of net interest income and non-interest income.
|
|
(5)
|
The dividend payout ratio represents dividends declared per share divided by net income per share. The following table sets forth total cash dividends paid per quarter, which is calculated by multiplying the dividends declared per share by the number of shares outstanding as of the applicable record date.
|
For the Threes Months Ended
March 31
|
|||||||||
2010
|
2009
|
||||||||
(In thousands)
|
|||||||||
Dividends paid to public stockholders
|
$ | 66 | $ | 66 | |||||
Dividends paid to Jacksonville Bancorp, MHC
|
— | — | |||||||
Total dividends paid
|
$ | 66 | $ | 66 | |||||
Total dividends waived by Jacksonville Bancorp, MHC
|
$ | 78 | $ | 78 | |||||
Total dividends paid and total dividends waived by Jacksonville Bancorp, MHC
|
$ | 144 | $ | 144 |
●
|
statements of our goals, intentions and expectations;
|
●
|
statements regarding our business plans, prospects, growth and operating strategies;
|
●
|
statements regarding the asset quality of our loan and investment portfolios; and
|
●
|
estimates of our risks and future costs and benefits.
|
●
|
general economic conditions, either nationally or in our market areas, that are worse than expected;
|
●
|
competition among depository and other financial institutions;
|
●
|
changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments;
|
●
|
adverse changes in the securities markets;
|
●
|
changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;
|
●
|
our ability to enter new markets successfully and capitalize on growth opportunities;
|
●
|
our ability to successfully integrate acquired entities;
|
●
|
changes in consumer spending, borrowing and savings habits;
|
●
|
changes in accounting policies and practices, as may be adopted by the bank regulatory agencies and the Financial Accounting Standards Board; and
|
●
|
changes in our organization, compensation and benefit plans.
|
Based Upon the Sale at $10.00 Per Share of
|
||||||||||||||||||||||||||||||||
998,750 Shares
|
1,175,000 Shares
|
1,351,250 Shares
|
1,553,938
Shares (1)
|
|||||||||||||||||||||||||||||
Amount
|
Percent
of Net Proceeds |
Amount
|
Percent
of Net Proceeds |
Amount
|
Percent
of Net Proceeds |
Amount
|
Percent
of Net Proceeds |
|||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||
Offering proceeds
|
$ | 9,988 | $ | 11,750 | $ | 13,513 | $ | 15,539 | ||||||||||||||||||||||||
Less offering expenses
|
1,241 | 1,286 | 1,332 | 1,384 | ||||||||||||||||||||||||||||
Net offering proceeds
|
$ | 8,746 | 100.0 | % | $ | 10,464 | 100.0 | % | $ | 12,181 | 100.0 | % | $ | 14,156 | 100.0 | % | ||||||||||||||||
Distribution of net proceeds:
|
||||||||||||||||||||||||||||||||
To Jacksonville Savings Bank
|
$ | 4,373 | 50.0 | % | $ | 5,232 | 50.0 | % | $ | 6,090 | 50.0 | % | $ | 7,078 | 50.0 | % | ||||||||||||||||
To fund loan to employee stock ownership plan
|
$ | 400 | 4.6 | % | $ | 470 | 4.5 | % | $ | 541 | 4.4 | % | $ | 622 | 4.4 | % | ||||||||||||||||
Retained by Jacksonville Bancorp-Maryland
|
$ | 3,974 | 45.4 | % | $ | 4,762 | 45.5 | % | $ | 5,550 | 45.6 | % | $ | 6,456 | 45.6 | % |
(1)
|
As adjusted to give effect to an increase in the number of shares, which could occur due to a 15% increase in the offering range to reflect demand for the shares, changes in market or general financial conditions following the commencement of the offering, or regulatory considerations.
|
●
|
to fund a loan to the employee stock ownership plan to purchase up to 4% of the shares of common stock sold in the offering (between $400,000 and $541,000, or $622,000 if the offering is increased by 15%);
|
●
|
to pay cash dividends to stockholders;
|
●
|
to repurchase shares of our common stock;
|
●
|
to invest in securities;
|
●
|
to finance the acquisition of financial institutions, or other financial services companies as opportunities arise, although we do not currently have any agreements or understandings regarding any specific acquisition transaction; and
|
●
|
for other general corporate purposes.
|
●
|
to fund new loans, including one- to four-family residential mortgage loans, commercial and agricultural real estate loans, commercial and agricultural business loans and consumer loans;
|
●
|
to enhance existing products and services and to support the development of new products and services;
|
●
|
to reduce wholesale funding;
|
●
|
to invest in securities;
|
●
|
to expand its retail banking franchise by acquiring new branches or by acquiring other financial institutions, or other financial services companies as opportunities arise, although we do not currently have any agreements to acquire a financial institution or other entity; and
|
●
|
for other general corporate purposes.
|
Price Per Share
|
Cash
|
|||||||||||
High
|
Low
|
Dividend Declared
|
||||||||||
2010
|
||||||||||||
Second quarter (through _______________)
|
$ | $ | $ | |||||||||
First quarter
|
16.00 | 9.00 | 0.075 | |||||||||
2009
|
||||||||||||
Fourth quarter
|
$ | 10.38 | $ | 8.14 | $ | 0.075 | ||||||
Third quarter
|
11.48 | 8.12 | 0.075 | |||||||||
Second quarter
|
11.49 | 7.84 | 0.075 | |||||||||
First quarter
|
9.75 | 7.01 | 0.075 | |||||||||
2008
|
||||||||||||
Fourth quarter
|
$ | 10.00 | $ | 7.80 | $ | 0.075 | ||||||
Third quarter
|
10.15 | 9.03 | 0.075 | |||||||||
Second quarter
|
12.60 | 10.15 | 0.075 | |||||||||
First quarter
|
13.25 | 9.00 | 0.075 |
Pro Forma at December 31, 2009, Based Upon the Sale in the Offering of | ||||||||||||||||||||||||||||||||||||||||
Jacksonville Savings
Bank Historical at December 31, 2009 |
998,750 Shares
|
1,175,000 Shares
|
1,351,250 Shares
|
1,553,938 Shares (1)
|
||||||||||||||||||||||||||||||||||||
Amount
|
Percent
of Assets (2) |
Amount
|
Percent
of Assets (2) |
Amount
|
Percent
of Assets (2) |
Amount
|
Percent
of Assets (2) |
Amount
|
Percent
of Assets (2) |
|||||||||||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||
Equity capital
|
$ | 25,024 | 8.67 | % | $ | 29,821 | 10.18 | % | $ | 30,610 | 10.42 | % | $ | 31,397 | 10.66 | % | $ | 32,304 | 10.93 | % | ||||||||||||||||||||
Tier 1 risk-based capital(4)(5)
|
$ | 21,601 | 10.70 | % | $ | 26,398 | 13.02 | % | $ | 27,187 | 13.40 | % | $ | 27,974 | 13.78 | % | $ | 28,881 | 14.21 | % | ||||||||||||||||||||
Tier 1 risk-based requirement(3)
|
8,073 | 4.00 | 8,108 | 4.00 | 8,115 | 4.00 | 8,122 | 4.00 | 8,130 | 4.00 | ||||||||||||||||||||||||||||||
Excess
|
$ | 13,528 | 6.70 | % | $ | 18,290 | 9.02 | % | $ | 19,072 | 9.40 | % | $ | 19,852 | 9.78 | % | $ | 20,751 | 10.21 | |||||||||||||||||||||
Core (leverage) capital(5)
|
$ | 21,601 | 7.44 | % | $ | 26,398 | 8.96 | % | $ | 27,187 | 9.20 | % | $ | 27,974 | 9.44 | % | $ | 28,881 | 9.71 | % | ||||||||||||||||||||
Core (leverage) requirement (3)
|
11,611 | 4.00 | 11,786 | 4.00 | 11,820 | 4.00 | 11,854 | 4.00 | 11,894 | 4.00 | ||||||||||||||||||||||||||||||
Excess
|
$ | 9,990 | 3.44 | % | $ | 14,612 | 4.96 | % | $ | 15,367 | 5.20 | % | $ | 16,120 | 5.44 | % | $ | 16,987 | 5.71 | % | ||||||||||||||||||||
Total risk-based
capital (4)(5)
|
$ | 23,891 | 11.83 | % | $ | 28,688 | 14.15 | % | $ | 29,477 | 14.53 | % | $ | 30,264 | 14.91 | % | $ | 31,171 | 15.34 | % | ||||||||||||||||||||
Risk-based requirement
|
16,146 | 8.00 | 16,216 | 8.00 | 16,230 | 8.00 | 16,243 | 8.00 | 16,259 | 8.00 | ||||||||||||||||||||||||||||||
Excess
|
$ | 7,745 | 3.83 | % | $ | 12,472 | 6.15 | % | $ | 13,247 | 6.53 | % | $ | 14,021 | 6.91 | % | $ | 14,912 | 7.34 | % | ||||||||||||||||||||
Net Proceeds Infused
|
$ | 4,373 | $ | 5,232 | $ | 6,090 | $ | 7,078 | ||||||||||||||||||||||||||||||||
MHC capital contribution
|
824 | 824 | 824 | 824 | ||||||||||||||||||||||||||||||||||||
Less: ESOP
|
(400 | ) | (470 | ) | (541 | ) | (622 | ) | ||||||||||||||||||||||||||||||||
Pro Forma Increase
|
$ | 4,797 | $ | 5,586 | $ | 6,373 | $ | 7,280 |
(1) |
As adjusted to give effect to an increase in the number of shares that could occur due to a 15% increase in the offering range to reflect demand for the shares, changes in market or general financial conditions following the commencement of the offering, or regulatory considerations.
|
(2) |
Tangible and core capital levels are shown as a percentage of total adjusted assets. Risk-based capital levels are shown as a percentage of risk-weighted assets.
|
(3) |
The current core capital requirement for financial institutions is 3% of total adjusted assets for financial institutions that receive the highest supervisory rating for safety and soundness and a 4% to 5% core capital ratio requirement for all other financial institutions. In addition, the Federal Deposit Insurance Corporation requires a Tier 1 risk-based capital ratio of 4% or greater.
|
(4) |
Pro forma amounts and percentages assume net proceeds are invested in assets that carry a 20% risk weighting.
|
(5) |
Pro forma capital levels assume that the employee stock ownership plan purchases 4.0% of the shares of common stock to be outstanding immediately following the stock offering with funds we lend. Pro forma GAAP and regulatory capital have been reduced by the amount required to fund this plan. See “Management” for a discussion of the employee stock ownership plan.
|
Pro Forma at December 31, 2009, Based upon the Sale in the Offering of | ||||||||||||||||||||
Jacksonville
Bancorp-Federal Historical at December 31, 2009 |
Minimum
998,750 Shares at $10.00 per Share |
Midpoint
1,175,000 Shares at $10.00 per Share |
Maximum
1,351,250 Shares at $10.00 per Share |
Maximum as
adjusted 1,553,938 Shares at $10.00 per Share (1) |
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Deposits (2)
|
$ | 254,700 | $ | 253,890 | $ | 253,890 | $ | 253,890 | $ | 253,890 | ||||||||||
Borrowed funds
|
3,789 | 3,789 | 3,789 | 3,789 | 3,789 | |||||||||||||||
Total deposits and borrowed funds
|
$ | 258,489 | $ | 257,679 | $ | 257,679 | $ | 257,679 | $ | 257,679 | ||||||||||
Stockholders’ equity:
|
||||||||||||||||||||
Preferred stock, $.01 par value, 10,000,000 shares authorized (post-conversion) (3)
|
— | — | — | — | — | |||||||||||||||
Common stock, $.01 par value, 25,000,000 shares authorized (post-conversion); shares to be issued as reflected (3) (4)
|
20 | 18 | 22 | 25 | 29 | |||||||||||||||
Additional paid-in capital (3)
|
6,634 | 15,383 | 17,096 | 18,810 | 20,781 | |||||||||||||||
MHC capital contribution (3)
|
— | 824 | 824 | 824 | 824 | |||||||||||||||
Retained earnings (5)
|
18,399 | 18,399 | 18,399 | 18,399 | 18,399 | |||||||||||||||
Accumulated other comprehensive income
|
696 | 696 | 696 | 696 | 696 | |||||||||||||||
Less:
|
||||||||||||||||||||
Treasury stock
|
(486 | ) | (486 | ) | (486 | ) | (486 | ) | (486 | ) | ||||||||||
Common stock held by employee stock ownership plan (6)
|
— | (400 | ) | (470 | ) | (541 | ) | (622 | ) | |||||||||||
Total stockholders’ equity
|
$ | 25,263 | $ | 34,434 | $ | 36,081 | $ | 37,727 | $ | 39,621 | ||||||||||
Pro Forma Shares Outstanding
|
||||||||||||||||||||
Total shares outstanding
|
1,920,817 | 1,846,872 | 2,172,790 | 2,498,709 | 2,873,515 | |||||||||||||||
Exchange shares issued
|
— | 848,122 | 997,790 | 1,147,459 | 1,319,578 | |||||||||||||||
Shares offered for sale
|
— | 998,750 | 1,175,000 | 1,351,250 | 1,553,938 | |||||||||||||||
Total stockholders’ equity as a percentage of total assets (2)
|
8.75 | % | 11.92 | % | 12.49 | % | 13.06 | % | 13.72 | % | ||||||||||
Tangible equity ratio
|
7.80 | % | 10.98 | % | 11.55 | % | 12.12 | % | 12.77 | % |
(1)
|
As adjusted to give effect to an increase in the number of shares of common stock that could occur due to a 15% increase in the offering range to reflect demand for shares, changes in market or general financial conditions following the commencement of the subscription and community offerings, or regulatory considerations.
|
(2)
|
Does not reflect withdrawals from deposit accounts for the purchase of shares of common stock in the conversion and offering. These withdrawals would reduce pro forma deposits and assets by the amount of the withdrawals. On a pro forma basis, reflects elimination of $810,000 of cash in Jacksonville Bancorp, MHC held as deposits of Jacksonville Savings Bank.
|
(3)
|
Jacksonville Bancorp-Federal currently has 10.0 million authorized shares of preferred stock and 20.0 million authorized shares of common stock, par value $0.01 per share. On a pro forma basis, Jacksonville Bancorp-Maryland common stock and additional paid-in capital have been revised to reflect the number of shares of Jacksonville Bancorp-Maryland common stock to be outstanding, which is 1,846,872 shares, 2,172,790 shares, 2,498,709 shares and 2,873,515 shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively. On a pro forma basis, reflects transfer to equity of $824,000 of net assets in Jacksonville Bancorp, MHC.
|
(4)
|
No effect has been given to the issuance of additional shares of Jacksonville Bancorp-Maryland common stock pursuant to the exercise of options under a stock-based benefit plan. If this plan is implemented within the first year after the closing of the offering, an amount up to 10% of the shares of Jacksonville Bancorp-Maryland common stock sold in the offering will be reserved for issuance upon the exercise of options under the plan. No effect has been given to the exercise of options currently outstanding. See “Management.”
|
(5)
|
The retained earnings of Jacksonville Savings Bank will be substantially restricted after the conversion. See “The Conversion and Offering—Liquidation Rights” and “Supervision and Regulation—Federal Banking Regulation.”
|
(6)
|
Assumes that 4.0
%
of the shares sold in the offering will be acquired by the employee stock ownership plan financed by a loan from Jacksonville Bancorp-Maryland. The loan will be repaid principally from Jacksonville Savings Bank’s contributions to the employee stock ownership plan. Since Jacksonville Bancorp-Maryland will finance the employee stock ownership plan debt, this debt will be eliminated through consolidation and no liability will be reflected on Jacksonville Bancorp-Maryland’s consolidated financial statements. Accordingly, the amount of shares of common stock acquired by the employee stock ownership plan is shown in this table as a reduction of total stockholders’ equity.
|
(i)
|
100,000 shares of common stock will be purchased by our executive officers and directors, and their associates;
|
(ii)
|
our employee stock ownership plan will purchase 4.0% of the shares of common stock sold in the offering, with a loan from Jacksonville Bancorp-Maryland. The loan will be repaid in substantially equal payments of principal and interest over a period of 20 years;
|
(iii)
|
Keefe, Bruyette & Woods, Inc. will receive a fee equal to 1.5% of the dollar amount of shares of common stock sold in the subscription offering, 2.5% of the dollar amount of shares of common stock sold in the community offering and 6.0% of the dollar amount of shares sold in the syndicated offering and 75%
of the total shares will be subscribed for in the subscription offering. No fee will be paid with respect to shares of common stock purchased by our qualified and non-qualified employee stock benefit plans, or stock purchased by our officers, directors and employees, and their immediate families; and
|
(iv)
|
total expenses of the offering, including the marketing fees to be paid to Keefe, Bruyette & Woods, Inc., will be between $1.2 million at the minimum of the offering range and $1.4 million at the maximum of the offering range, as adjusted.
|
●
|
withdrawals from deposit accounts for the purpose of purchasing shares of common stock in the stock offering;
|
●
|
our results of operations after the stock offering; or
|
●
|
changes in the market price of the shares of common stock after the stock offering.
|
At or for the Fiscal Year Ended December 31, 2009
Based upon the Sale at $10.00 Per Share of
|
||||||||||||||||
998,750
Shares
|
1,175,000
Shares
|
1,351,250
Shares
|
1,553,938
Shares (1)
|
|||||||||||||
(Dollars in thousands, except per share amounts)
|
||||||||||||||||
Gross proceeds of offering
|
9,988 | 11,750 | 13,513 | 15,539 | ||||||||||||
Less: Expenses
|
$ | 1,241 | $ | 1,286 | $ | 1,332 | $ | 1,384 | ||||||||
Estimated Net Proceeds
|
8,746 | 10,464 | 12,181 | 14,156 | ||||||||||||
Less: Common stock purchased by employee stock ownership plan
|
(400 | ) | (470 | ) | (541 | ) | (622 | ) | ||||||||
Estimated net proceeds, as adjusted
|
$ | 8,347 | $ | 9,994 | $ | 11,640 | $ | 13,534 | ||||||||
For the Year Ended December 31, 2009
|
||||||||||||||||
Consolidated net income:
|
||||||||||||||||
Historical
|
$ | 1,396 | $ | 1,396 | $ | 1,396 | $ | 1,396 | ||||||||
Pro forma adjustments:
|
||||||||||||||||
Income on adjusted net proceeds
|
169 | 202 | 235 | 273 | ||||||||||||
Employee stock ownership plan (2)
|
(12 | ) | (14 | ) | (17 | ) | (19 | ) | ||||||||
Options granted under the stock-based benefit plan (3)
|
(40 | ) | (47 | ) | (54 | ) | (62 | ) | ||||||||
Pro forma net income
|
$ | 1,512 | 1,536 | $ | 1,560 | $ | 1,588 | |||||||||
Net income per share (4):
|
||||||||||||||||
Historical
|
$ | 0.78 | $ | 0.66 | $ | 0.57 | $ | 0.49 | ||||||||
Pro form adjustments:
|
||||||||||||||||
Income on adjusted net proceeds
|
0.09 | 0.09 | 0.10 | 0.10 | ||||||||||||
Employee stock ownership plan (2)
|
(0.01 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | ||||||||
Options granted under the stock-based benefit plan (3)
|
(0.02 | ) | (0.02 | ) | (0.02 | ) | (0.02 | ) | ||||||||
Pro forma net income per share (4) (5)
|
$ | 0.84 | $ | 0.72 | $ | 0.64 | $ | 0.56 | ||||||||
Offering price to pro forma net income per share
|
11.90 | x | 13.89 | x | 15.63 | x | 17.86 | x | ||||||||
Number of shares used in net income per share calculations (4)
|
1,808,919 | 2,128,140 | 2,447,361 | 2,814,466 | ||||||||||||
At December 31, 2009
|
||||||||||||||||
Stockholders’ equity:
|
||||||||||||||||
Historical
|
$ | 25,263 | $ | 25,263 | $ | 25,263 | $ | 25,263 | ||||||||
Estimated net proceeds
|
8,746 | 10,464 | 12,181 | 14,156 | ||||||||||||
Equity increase from MHC
|
824 | 824 | 824 | 824 | ||||||||||||
Less: Common stock acquired by employee stock ownership plan (2)
|
(400 | ) | (470 | ) | (541 | ) | (622 | ) | ||||||||
Pro forma stockholders’ equity
|
34,434 | 36,081 | 37,727 | 39,621 | ||||||||||||
Less: Intangible assets
|
(2,727 | ) | (2,727 | ) | (2,727 | ) | (2,727 | ) | ||||||||
Pro forma tangible stockholders’ equity
|
$ | 31,707 | $ | 33,354 | $ | 35,000 | $ | 36,894 | ||||||||
Stockholders’ equity per share:(6)
|
||||||||||||||||
Historical
|
$ | 13.67 | $ | 11.63 | $ | 10.12 | $ | 8.79 | ||||||||
Estimated net proceeds
|
4.74 | 4.82 | 4.87 | 4.93 | ||||||||||||
Plus: Assets received from the MHC
|
0.45 | 0.38 | 0.33 | 0.29 | ||||||||||||
Less: Common stock acquired by employee stock ownership plan
|
(0.22 | ) | (0.22 | ) | (0.22 | ) | (0.22 | ) | ||||||||
Pro forma stockholders’ equity per share (5) (6)
|
$ | 18.64 | $ | 16.61 | $ | 15.10 | $ | 13.79 | ||||||||
Intangible assets per share
|
$ | (1.48 | ) | $ | (1.26 | ) | $ | (1.09 | ) | $ | (0.95 | ) | ||||
Pro forma tangible stockholders’ equity per share (5) (6)
|
$ | 17.16 | $ | 15.35 | $ | 14.01 | $ | 12.84 | ||||||||
Offering price as percentage of pro forma stockholders’ equity per share
|
53.65 | % | 60.20 | % | 66.23 | % | 72.52 | % | ||||||||
Offering price as percentage of pro forma tangible stockholders’ equity per share
|
58.28 | % | 65.15 | % | 71.38 | % | 77.88 | % | ||||||||
Number of shares outstanding for pro forma book value per share calculations
|
1,846,872 | 2,172,790 | 2,498,709 | 2,873,515 |
(1)
|
As adjusted to give effect to an increase in the number of shares that could occur due to a 15% increase in the offering range to reflect demand for the shares, changes in market and financial conditions following the commencement of the offering, or regulatory considerations.
|
(2)
|
Assumes that 4.0% of shares of common stock sold in the offering will be purchased by the employee stock ownership plan. For purposes of this table, the funds used to acquire these shares are assumed to have been borrowed by the employee stock ownership plan from Jacksonville Bancorp-Maryland. Jacksonville Savings Bank intends to make annual contributions to the employee stock ownership plan in an amount at least equal to the required principal and interest payments on the debt. Jacksonville Savings Bank’s total annual payments on the employee stock ownership plan debt are based upon
20 equal annual installments of principal and interest. ASC 7-18 requires that an employer record compensation expense in an amount equal to the fair value of the shares committed to be released to employees. The pro forma adjustments assume that the employee stock ownership plan shares are allocated in equal annual installments based on the number of loan repayment installments assumed to be paid by Jacksonville Savings Bank, the fair value of the common stock remains equal to the subscription price and the employee stock ownership plan expense reflects an effective combined federal and state tax rate of 38.82%. The unallocated employee stock ownership plan shares are reflected as a reduction of stockholders’ equity. No reinvestment is assumed on proceeds contributed to fund the employee stock ownership plan. The pro forma net income further assumes that 1,998, 2,350, 2,703 and 3,108 shares were committed to be released during the period at the minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively, and in accordance with ASC 7-18, only the employee stock ownership plan shares committed to be released during the period were considered outstanding for purposes of net income per share calculations.
|
(3)
|
If approved by Jacksonville Bancorp-Maryland’s stockholders, the stock-based benefit plan may grant options to acquire an aggregate number of shares of common stock equal to 10% of the shares to be sold in the offering. If the plan is implemented more than one year after completion of the conversion, the number of options may exceed 10% of the shares sold in the offering, and the plan may include stock or equity awards in addition to options. Stockholder approval of the stock-based benefit plan may not occur earlier than six months after the completion of the conversion. In calculating the pro forma effect of the stock-based benefit plan, it is assumed that the exercise price of the stock options and the trading price of the common stock at the date of grant were $10.00 per share, the estimated grant-date fair value determined using the Black-Scholes option pricing model was $2.22 for each option, the aggregate grant-date fair value of the stock options was amortized to expense on a straight-line basis over a five-year vesting period of the options, and that 25% of the amortization expense (or the assumed portion relating to options granted to directors) resulted in a tax benefit using an assumed tax rate of 38.82%. The actual expense of the stock-based benefit plan will be determined by the grant-date fair value of the options, which will depend on a number of factors, including the valuation assumptions used in the option pricing model ultimately adopted. Under the above assumptions, the adoption of the stock-based benefit plan will result in no additional shares under the treasury stock method for purposes of calculating earnings per share. There can be no assurance that the actual exercise price of the stock options will be equal to the $10.00 price per share. If a portion of the shares to satisfy the exercise of options under the stock-based benefit plan is obtained from the issuance of authorized but unissued shares, our net income per share and stockholders’ equity per share would decrease. The issuance of authorized but unissued shares of common stock pursuant to the exercise of options under such plan would dilute stockholders’ ownership and voting interests by approximately 5.13% at the maximum of the offering range.
|
(4)
|
Per share figures include publicly held shares of Jacksonville Bancorp-Federal common stock that will be exchanged for shares of Jacksonville Bancorp-Maryland common stock in the conversion. See “The Conversion and Offering—Share Exchange Ratio for Current Stockholders.” Net income per share computations are determined by taking the number of shares assumed to be sold in the offering and the number of new shares assumed to be issued in exchange for publicly held shares and, in accordance with ASC 7-18, subtracting the employee stock ownership plan shares which have not been committed for release during the respective periods. See note 2. The number of shares of common stock actually sold and the corresponding number of exchange shares may be more or less than the assumed amounts. Pro forma net income per share has been annualized for purposes of calculating the offering price to pro forma net earnings per share.
|
(5)
|
The retained earnings of Jacksonville Savings Bank will be substantially restricted after the conversion. See “Our Dividend Policy,” “The Conversion and Offering—Liquidation Rights” and “Supervision and Regulation—Federal Banking Regulation—Capital Distributions.”
|
(6)
|
Per share figures include publicly held shares of Jacksonville Bancorp-Federal common stock that will be exchanged for shares of Jacksonville Bancorp-Maryland common stock in the conversion. Stockholders’ equity per share calculations are based upon the sum of (i) the number of subscription shares assumed to be sold in the offering and (ii) shares to be issued in exchange for publicly held shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively. The exchange shares reflect an exchange ratio of 0.9615, 1.1312, 1.3009 and 1.4960 at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively. The number of subscription shares actually sold and the corresponding number of exchange shares may be more or less than the assumed amounts.
|
(i)
|
the employee stock ownership plan will acquire 62,158 shares of common stock with a $622,000 loan that is expected to be repaid over 20 years, resulting in an annual pre-tax expense of approximately $31,100 (assuming that the shares of common stock maintain a value of $10.00 per share); and
|
(ii)
|
the new stock-based benefit plan would award options to purchase a number of shares equal to 10% of the shares sold in the offering, or 155,394 shares, to eligible participants, and such options would be expensed as the options vest. Assuming all options are awarded under the stock-based benefit plan at a price of $10.00 per share, and that the options vest over a minimum of five years, the corresponding annual pre-tax expense associated with options awarded under the stock-based benefit plan would be approximately $68,995 (assuming a grant-date fair value of $2.22 per option, using the Black-Scholes option valuation methodology).
|
At
December 31, 2009 |
||||||||||||||||||||||||||||||||||||||||
For the Years Ended December 31,
|
||||||||||||||||||||||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||||||||||||||||||||||
Yield/
Rate |
Average
Outstanding Balance |
Interest
|
Yield/
Rate |
Average
Outstanding Balance |
Interest
|
Yield/
Rate |
Average
Outstanding Balance |
Interest
|
Yield/
Rate |
|||||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||||||||||||||||||
Loans
(1)
|
6.23 | % | $ | 182,813 | $ | 11,592 | 6.34 | % | $ | 177,963 | $ | 12,026 | 6.76 | % | $ | 165,715 | $ | 11,736 | 7.08 | % | ||||||||||||||||||||
Investment securities
(2)
|
3.91 | 40,732 | 1,554 | 3.81 | (6) | 53,392 | 2,072 | 3.88 | (6) | 79,630 | 3,189 | 4.00 | (6) | |||||||||||||||||||||||||||
Mortgage-backed securities
|
4.05 | 40,381 | 1,262 | 3.13 | 31,921 | 1,580 | 4.95 | 12,282 | 596 | 4.85 | ||||||||||||||||||||||||||||||
Cash and cash equivalents
|
0.04 | 8,231 | 12 | 0.15 | 9,313 | 230 | 2.47 | 1,838 | 88 | 4.83 | ||||||||||||||||||||||||||||||
Total interest-earning assets
|
5.50 | 272,157 | 14,420 | 5.30 | 272,589 | 15,908 | 5.83 | 259,465 | 15,609 | 6.02 | ||||||||||||||||||||||||||||||
Non-interest-earning assets
|
22,626 | 20,642 | 18,169 | |||||||||||||||||||||||||||||||||||||
Total assets
|
$ | 294,783 | $ | 293,231 | $ | 277,634 | ||||||||||||||||||||||||||||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||||||||||||||||||
Interest bearing checking
|
0.32 | % | $ | 29,009 | $ | 94 | 0.32 | % | $ | 28,572 | $ | 199 | 0.70 | % | $ | 25,820 | $ | 302 | 1.17 | % | ||||||||||||||||||||
Savings accounts
|
0.86 | 24,849 | 218 | 0.88 | 22,677 | 224 | 0.99 | 22,774 | 227 | 1.00 | ||||||||||||||||||||||||||||||
Certificates of deposit
|
2.65 | 149,124 | 4,586 | 3.08 | 147,891 | 6,112 | 4.13 | 145,325 | 6,846 | 4.71 | ||||||||||||||||||||||||||||||
Money market savings
|
1.02 | 26,750 | 378 | 1.41 | 24,442 | 584 | 2.39 | 22,502 | 989 | 4.40 | ||||||||||||||||||||||||||||||
Money market deposits
|
0.85 | 4,616 | 40 | 0.86 | 4,700 | 50 | 1.06 | 4,957 | 70 | 1.41 | ||||||||||||||||||||||||||||||
Total interest-bearing deposits
|
1.92 | 234,348 | 5,316 | 2.27 | 228,282 | 7,169 | 3.14 | 221,378 | 8,434 | 3.81 | ||||||||||||||||||||||||||||||
Federal Home Loan Bank
advances
|
5,359 | 104 | 1.94 | 12,018 | 469 | 3.91 | 8,598 | 433 | 5.04 | |||||||||||||||||||||||||||||||
Short-term borrowings
|
0.19 | 5,168 | 12 | 0.94 | 6,028 | 78 | 1.29 | 4,438 | 189 | 4.26 | ||||||||||||||||||||||||||||||
Total borrowings
|
0.19 | 10,527 | 116 | 1.10 | 18,046 | 548 | 3.04 | 13,036 | 622 | 4.78 | ||||||||||||||||||||||||||||||
Total interest-bearing liabilities
|
1.89 | 244,875 | 5,432 | 2.22 | % | 246,328 | 7,716 | 3.13 | % | 234,414 | 9,056 | 3.86 | % | |||||||||||||||||||||||||||
Non-interest-bearing liabilities
(7)
|
25,360 | 23,881 | 21,586 | |||||||||||||||||||||||||||||||||||||
Total liabilities
|
270,235 | 270,209 | 256,000 | |||||||||||||||||||||||||||||||||||||
Stockholders’ equity
|
24,548 | 23,022 | 21,634 | |||||||||||||||||||||||||||||||||||||
Total liabilities and stockholders’ equity
|
$ | 294,783 | $ | 293,231 | $ | 277,634 | ||||||||||||||||||||||||||||||||||
Net interest income
|
$ | 8,988 | $ | 8,192 | $ | 6,553 | ||||||||||||||||||||||||||||||||||
Net interest rate spread
(3)
|
3.61 | % | 3.08 | % | 2.70 | % | 2.15 | % | ||||||||||||||||||||||||||||||||
Net interest-earning assets
(4)
|
$ | 27,282 | $ | 26,261 | $ | 25,051 | ||||||||||||||||||||||||||||||||||
Net interest margin
(5)
|
3.30 | % | 3.01 | % | 2.53 | % | ||||||||||||||||||||||||||||||||||
Average interest-earning assets to average interest-bearing liabilities
|
111.14 | % | 110.66 | % | 110.69 | % |
(1)
|
Includes non-accrual loans and loans held for sale and fees of $110,000 for 2009, $54,000 for 2008 and $93,000 for 2007.
|
(2)
|
Includes Federal Home Loan Bank stock and U.S. Agency securities.
|
(3)
|
Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
|
(4)
|
Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
|
(5)
|
Net interest margin represents net interest income divided by average total interest-earning assets.
|
(6)
|
We used an assumed 34% tax rate in computing tax equivalent adjustments. The tax equivalent yield of investment securities was 5.14%, 4.82%, and 4.26% for the years ended December 31, 2009, 2008 and 2007, respectively. Tax equivalent adjustments to income on investment securities was $542,000, $503,000 and $203,000 for the years ended December 31, 2009, 2008 and 2007, respectively.
|
(7)
|
Includes non-interest bearing deposits of $19.8 million, $18.5 million and $16.2 million for the years ended December 31, 2009, 2008 and 2007, respectively.
|
Years Ended December 31,
2009 vs 2008
|
Years Ended December 31,
2008 vs 2007
|
|||||||||||||||||||||||
Increase (Decrease)
Due to |
Total
Increase (Decrease) |
Increase (Decrease)
Due to |
Total
Increase (Decrease) |
|||||||||||||||||||||
Rate
|
Volume
|
Rate
|
Volume
|
|||||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Interest-earning assets:
|
||||||||||||||||||||||||
Loans
|
$ | (756 | ) | $ | 322 | $ | (434 | ) | $ | (553 | ) | $ | 843 | $ | 290 | |||||||||
Investment securities
|
(34 | ) | (484 | ) | (518 | ) | (96 | ) | (1,021 | ) | (1,117 | ) | ||||||||||||
Mortgage-backed securities
|
(672 | ) | 354 | (318 | ) | 12 | 972 | 984 | ||||||||||||||||
Cash and cash equivalents
|
(194 | ) | (24 | ) | (218 | ) | (62 | ) | 204 | 142 | ||||||||||||||
Total interest-earning assets
|
$ | (1,656 | ) | $ | 168 | $ | (1,488 | ) | $ | (699 | ) | $ | 998 | $ | 299 | |||||||||
Interest-bearing liabilities:
|
||||||||||||||||||||||||
Interest bearing checking
|
$ | (108 | ) | $ | 3 | $ | (105 | ) | $ | (132 | ) | $ | 29 | $ | (103 | ) | ||||||||
Savings accounts
|
(26 | ) | 20 | (6 | ) | (2 | ) | (1 | ) | (3 | ) | |||||||||||||
Certificates of deposit
|
(1,577 | ) | 51 | (1,526 | ) | (853 | ) | 119 | (734 | ) | ||||||||||||||
Money market savings
|
(257 | ) | 51 | (206 | ) | (484 | ) | 79 | (405 | ) | ||||||||||||||
Money market deposits
|
(9 | ) | (1 | ) | (10 | ) | (16 | ) | (4 | ) | (20 | ) | ||||||||||||
Total interest-bearing deposits
|
(1,977 | ) | 124 | (1,853 | ) | (1,487 | ) | 222 | (1,265 | ) | ||||||||||||||
Federal Home Loan Bank advances
|
(174 | ) | (192 | ) | (366 | ) | (111 | ) | 147 | 36 | ||||||||||||||
Short-term borrowings
|
(56 | ) | (9 | ) | (65 | ) | (163 | ) | 52 | (111 | ) | |||||||||||||
(230 | ) | (202 | ) | (431 | ) | (274 | ) | 199 | (75 | ) | ||||||||||||||
Total interest-bearing liabilities
|
(2,207 | ) | (77 | ) | (2,284 | ) | (1,761 | ) | 421 | (1,340 | ) | |||||||||||||
Change in net interest income
|
$ | 551 | $ | 245 | $ | 796 | $ | 1,062 | $ | 577 | $ | 1,639 |
Change in Net Interest Income
|
|||||||||||||||||
December 31, 2009
|
December 31, 2008
|
ALCO
Benchmark |
|||||||||||||||
Rate Shock
|
$ Change
|
% Change
|
$ Change
|
% Change
|
|||||||||||||
(Dollars in thousands)
|
|||||||||||||||||
+300 basis points
|
174 | 1.71 | (143 | ) | (1.46 | ) |
>(20.00)%
|
||||||||||
+200 basis points
|
220 | 2.16 | (68 | ) | (0.69 | ) |
>(20.00)%
|
||||||||||
+100 basis points
|
184 | 1.80 | 33 | 0.34 |
>(12.50)%
|
||||||||||||
(100) basis points
|
(271 | ) | (2.66 | ) | 95 | 0.97 |
>(12.50)%
|
||||||||||
(200) basis points
|
(412 | ) | (4.05 | ) | (12 | ) | (0.12 | ) |
>(20.00)%
|
||||||||
(300) basis points
|
(589 | ) | (5.78 | ) | (205 | ) | (2.10 | ) |
>(20.00)%
|
December 31, 2009
|
December 31, 2008
|
|||||||
(In thousands)
|
||||||||
Commitments to fund loans
|
$ | 36,946 | $ | 50,723 | ||||
Standby letters of credit
|
488 | 774 |
Minimum Required
|
December 31, 2009
Actual
|
December 31, 2008
Actual
|
||||||||||
Tier 1 Capital to Average Assets
|
4.00 | % | 7.44 | % | 7.30 | % | ||||||
Tier 1 Capital to Risk-Weighted Assets
|
4.00 | % | 10.70 | % | 10.02 | % | ||||||
Total Capital to Risk-Weighted Assets
|
8.00 | % | 11.83 | % | 10.94 | % |
At December 31,
|
||||||||||||||||||||||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||||||||||||||||||||
(Dollars in Thousands)
|
||||||||||||||||||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||||||||||||||||||
One- to four-family residential
(1)
|
$ | 38,581 | 22.2 | % | $ | 46,807 | 25.6 | % | $ | 50,459 | 28.7 | % | $ | 40,635 | 26.2 | % | $ | 40,126 | 28.2 | % | ||||||||||||||||||||
Commercial and agricultural
(2)
|
56,650 | 32.6 | 56,516 | 30.9 | 44,100 | 25.1 | 39,592 | 25.6 | 33,859 | 23.8 | ||||||||||||||||||||||||||||||
Multi-family residential
|
4,344 | 2.5 | 4,518 | 2.5 | 4,741 | 2.7 | 5,877 | 3.8 | 6,010 | 4.2 | ||||||||||||||||||||||||||||||
Total real estate loans
|
99,575 | 57.3 | 107,841 | 59.0 | 99,300 | 56.5 | 86,104 | 55.6 | 79,995 | 56.2 | ||||||||||||||||||||||||||||||
Commercial and agricultural business loans
|
34,393 | 19.8 | 35,356 | 19.3 | 36,539 | 20.8 | 32,837 | 21.2 | 28,679 | 20.2 | ||||||||||||||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||||||||||||||||||
Home equity/home improvement
(3)
|
28,119 | 16.2 | 30,002 | 16.4 | 30,087 | 17.1 | 27,202 | 17.6 | 26,382 | 18.5 | ||||||||||||||||||||||||||||||
Automobile
|
6,118 | 3.5 | 5,842 | 3.2 | 5,334 | 3.0 | 5,275 | 3.4 | 4,580 | 3.2 | ||||||||||||||||||||||||||||||
Other
|
7,837 | 4.5 | 5,950 | 3.2 | 6,402 | 3.6 | 5,313 | 3.4 | 4,657 | 3.3 | ||||||||||||||||||||||||||||||
Total consumer loans
|
42,074 | 24.2 | 41,794 | 22.8 | 41,823 | 23.7 | 37,790 | 24.4 | 35,619 | 25.0 | ||||||||||||||||||||||||||||||
Total loans receivable
|
176,042 | 101.3 | 184,991 | 101.1 | 177,662 | 101.0 | 156,731 | 101.2 | 144,293 | 101.4 | ||||||||||||||||||||||||||||||
Less:
|
||||||||||||||||||||||||||||||||||||||||
Unearned premium on purchased loans,
unearned discount and deferred loan
fees, net
|
69 | — | 109 | — | 29 | — | 29 | — | 175 | 0.1 | ||||||||||||||||||||||||||||||
Allowance for loan losses
|
2,290 | 1.3 | 1,934 | 1.1 | 1,766 | 1.0 | 1,864 | 1.2 | 1,846 | 1.3 | ||||||||||||||||||||||||||||||
Total loans receivable, net
|
$ | 173,683 | 100.0 | % | $ | 182,948 | 100.0 | % | $ | 175,867 | 100.0 | % | $ | 154,838 | 100.0 | % | $ | 142,272 | 100.0 | % |
(1)
|
Includes one- to four-family real estate construction loans of $54,000, $596,000, $352,000, $183,000 and $546,000
for the years ended December 31, 2009, 2008, 2007, 2006 and 2005, respectively.
|
(2)
|
Includes commercial and agricultural real estate construction loans of $4.2 million, $2.5 million, $472,000, $0 and $193,000
for the years ended December 31, 2009, 2008, 2007, 2006 and 2005, respectively.
|
(3)
|
Includes real estate construction loans of $3.6 million, $1.1 million, $1.4 million, $370,000 and $1.9 million
for the years ended December 31, 2009, 2008, 2007, 2006 and 2005, respectively.
|
One- to Four-Family Real
Estate
|
Commercial and
Agricultural Real Estate
|
Multi-Family Real Estate
|
Commercial and
Agricultural Business
|
|||||||||||||||||||||||||||||
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||
Due During the Years
Ending December 31,
|
||||||||||||||||||||||||||||||||
2010
|
$ | 3,748 | 7.51 | % | $ | 11,647 | 6.06 | % | $ | 15 | 9.50 | % | $ | 14,906 | 5.72 | % | ||||||||||||||||
2011
|
5,071 | 7.23 | 5,192 | 4.77 | 356 | 6.84 | 2,032 | 6.42 | ||||||||||||||||||||||||
2012
|
4,051 | 7.27 | 1,809 | 6.23 | 167 | 6.50 | 3,462 | 5.54 | ||||||||||||||||||||||||
2013 to 2014
|
3,689 | 7.10 | 1,694 | 6.21 | 106 | 6.00 | 9,364 | 5.85 | ||||||||||||||||||||||||
2015 to 2019
|
3,641 | 5.67 | 2,515 | 5.98 | 37 | 6.50 | 1,717 | 5.62 | ||||||||||||||||||||||||
2020 to 2024
|
3,592 | 6.35 | 8,575 | 5.34 | — | — | 1,225 | 5.66 | ||||||||||||||||||||||||
2025 and beyond
|
14,789 | 6.22 | 25,218 | 5.78 | 3,663 | 5.69 | 1,687 | 6.64 | ||||||||||||||||||||||||
Total
|
$ | 38,581 | 6.63 | % | $ | 56,650 | 5.71 | % | $ | 4,344 | 5.84 | % | $ | 34,393 | 5.82 | % |
Home Equity/Home
Improvement
|
Automobile
|
Other Consumer
|
Total
|
|||||||||||||||||||||||||||||
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
Amount
|
Weighted
Average
Rate
|
|||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||
Due During the Years
Ending December 31,
|
||||||||||||||||||||||||||||||||
2010
|
$ | 4,730 | 6.74 | % | $ | 368 | 8.84 | % | $ | 2,451 | 6.08 | % | $ | 37,865 | 6.16 | % | ||||||||||||||||
2011
|
3,577 | 7.37 | 1,060 | 8.28 | 888 | 7.61 | 18,176 | 6.53 | ||||||||||||||||||||||||
2012
|
4,217 | 7.46 | 1,502 | 7.62 | 833 | 8.10 | 16,041 | 6.88 | ||||||||||||||||||||||||
2013 to 2014
|
5,921 | 6.88 | 3,114 | 7.25 | 1,006 | 7.84 | 24,894 | 6.55 | ||||||||||||||||||||||||
2015 to 2019
|
7,359 | 5.69 | 74 | 8.72 | 551 | 7.40 | 15,894 | 5.80 | ||||||||||||||||||||||||
2020 to 2024
|
1,620 | 7.15 | — | — | 894 | 8.12 | 15,906 | 5.94 | ||||||||||||||||||||||||
2025 and beyond
|
695 | 6.77 | — | — | 1,214 | 9.43 | 47,266 | 6.04 | ||||||||||||||||||||||||
Total
|
$ | 28,119 | 6.71 | % | $ | 6,118 | 7.63 | % | $ | 7,837 | 7.54 | % | $ | 176,042 | 6.23 | % |
Due after December 31, 2010
|
||||||||||||
Fixed
|
Adjustable
|
Total
|
||||||||||
(In Thousands)
|
||||||||||||
Real estate loans:
|
||||||||||||
One- to four-family residential
|
$ | 25,829 | $ | 9,003 | $ | 34,832 | ||||||
Commercial and agricultural
|
5,497 | 39,507 | 45,004 | |||||||||
Multi-family residential
|
629 | 3,700 | 4,329 | |||||||||
Commercial and agricultural business loans
|
13,186 | 6,301 | 19,487 | |||||||||
Consumer loans
|
||||||||||||
Home equity/home improvement
|
14,180 | 9,210 | 23,390 | |||||||||
Automobile
|
5,750 | — | 5,750 | |||||||||
Other
|
4,803 | 582 | 5,385 | |||||||||
Total loans
|
$ | 69,874 | $ | 68,303 | $ | 138,177 |
For the Years Ended December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(In Thousands)
|
||||||||||||||||||||
Total loans receivable at beginning of year
|
$ | 184,991 | $ | 177,662 | $ | 156,731 | $ | 144,293 | $ | 127,855 | ||||||||||
Originations:
|
||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||
One- to four-family residential
|
72,109 | 38,717 | 30,104 | 25,708 | 31,551 | |||||||||||||||
Commercial and agricultural
|
9,163 | 23,038 | 8,897 | 10,808 | 16,826 | |||||||||||||||
Multi-family residential
|
— | — | — | 1,862 | 5,076 | |||||||||||||||
Commercial and agricultural business loans
|
27,295 | 31,027 | 29,404 | 31,510 | 19,532 | |||||||||||||||
Consumer loans:
|
||||||||||||||||||||
Home equity/home improvement
|
11,698 | 20,133 | 19,309 | 17,874 | 19,021 | |||||||||||||||
Automobile
|
4,017 | 4,188 | 3,777 | 4,336 | 3,697 | |||||||||||||||
Other
|
7,206 | 5,072 | 6,360 | 4,916 | 4,560 | |||||||||||||||
Total originations
|
131,488 | 122,175 | 97,851 | 97,014 | 100,263 | |||||||||||||||
Participation loans purchased
|
( 2,113 | ) | ( 11,569 | ) | ( 6,231 | ) | ( 3,736 | ) | ( 4,634 | ) | ||||||||||
Transfer of mortgage loans to foreclosed real estate owned
|
( 308 | ) | ( 667 | ) | ( 819 | ) | ( 329 | ) | ( 933 | ) | ||||||||||
Repayments
|
( 75,542 | ) | ( 95,671 | ) | ( 72,176 | ) | ( 71,422 | ) | ( 66,258 | ) | ||||||||||
Loan sales to secondary market
|
66,700 | 30,077 | 10,156 | 16,561 | 21,268 | |||||||||||||||
Total loans receivable at end of year
|
$ | 176,042 | $ | 184,991 | $ | 177,662 | $ | 156,731 | $ | 144,293 |
At December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Non-accrual loans:
|
||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||
One- to four-family residential
|
$ | 484 | $ | 445 | $ | 310 | $ | 435 | $ | 624 | ||||||||||
Commercial and agricultural
|
98 | 34 | 218 | 100 | — | |||||||||||||||
Multi-family residential
|
132 | 152 | — | — | — | |||||||||||||||
Commercial and agricultural business loans
|
416 | 48 | 82 | 704 | 290 | |||||||||||||||
Consumer loans:
|
||||||||||||||||||||
Home equity/home improvement
|
407 | 318 | 89 | 100 | 222 | |||||||||||||||
Automobile
|
8 | 3 | 12 | 1 | 1 | |||||||||||||||
Other
|
52 | 5 | 12 | 8 | 20 | |||||||||||||||
Total non-accrual loans
|
1,597 | 1,005 | 723 | 1,348 | 1,157 | |||||||||||||||
Loans delinquent 90 days or greater and still accruing:
|
||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||
One- to four-family residential
|
349 | 163 | 203 | — | 2 | |||||||||||||||
Commercial and agricultural
|
— | — | 156 | — | — | |||||||||||||||
Multi-family residential
|
— | — | — | — | — | |||||||||||||||
Commercial and agricultural business loans
|
— | — | — | — | — | |||||||||||||||
Consumer loans:
|
||||||||||||||||||||
Home equity/home improvement
|
— | — | — | — | — | |||||||||||||||
Automobile
|
3 | 18 | — | — | 17 | |||||||||||||||
Other
|
5 | 5 | 9 | 4 | 2 | |||||||||||||||
Total loans delinquent 90 days or greater and still accruing
|
357 | 186 | 368 | 4 | 21 | |||||||||||||||
Total non-performing loans
|
1,954 | 1,191 | 1,091 | 1,352 | 1,178 | |||||||||||||||
Other real estate owned and foreclosed assets:
|
||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||
One- to four-family residential
|
324 | 565 | 115 | 37 | 276 | |||||||||||||||
Commercial and agricultural
|
59 | 204 | 249 | 115 | 180 | |||||||||||||||
Multi-family residential
|
— | — | — | — | — | |||||||||||||||
Commercial and agricultural business loans
|
— | — | — | — | — | |||||||||||||||
Consumer loans:
|
||||||||||||||||||||
Home equity/home improvement
|
— | — | — | — | — | |||||||||||||||
Automobile
|
— | 9 | 23 | — | 15 | |||||||||||||||
Other
|
— | — | — | — | — | |||||||||||||||
Total other real estate owned and foreclosed assets
|
383 | 778 | 387 | 152 | 471 | |||||||||||||||
Total non-performing assets
|
$ | 2,337 | $ | 1,969 | $ | 1,478 | $ | 1,504 | $ | 1,649 | ||||||||||
Ratios:
|
||||||||||||||||||||
Non-performing loans to total loans
|
1.11 | % | 0.64 | % | 0.61 | % | 0.86 | % | 0.82 | % | ||||||||||
Non-performing assets to total
assets
|
0.81 | 0.68 | 0.51 | 0.56 | 0.65 |
Loans Delinquent For
|
||||||||||||||||||||||||
60-89 Days
|
90 Days and Over
|
Total
|
||||||||||||||||||||||
Number
|
Amount
|
Number
|
Amount
|
Number
|
Amount
|
|||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
At December 31, 2009
|
||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||
One- to four-family residential
|
6 | $ | 215 | 13 | $ | 907 | 19 | $ | 1,122 | |||||||||||||||
Commercial and agricultural
|
3 | 668 | 2 | 75 | 5 | 743 | ||||||||||||||||||
Multi-family residential
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial and agricultural business loans
|
1 | 14 | 2 | 109 | 3 | 123 | ||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||
Home equity/home improvement
|
4 | 43 | 11 | 203 | 15 | 246 | ||||||||||||||||||
Automobile
|
2 | 7 | 2 | 4 | 4 | 11 | ||||||||||||||||||
Other
|
3 | 1 | 7 | 31 | 10 | 32 | ||||||||||||||||||
Total loans
|
19 | $ | 948 | 37 | $ | 1,329 | 56 | $ | 2,277 | |||||||||||||||
At December 31, 2008
|
||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||
One- to four-family residential
|
4 | $ | 436 | 15 | $ | 695 | 19 | $ | 1,131 | |||||||||||||||
Commercial and agricultural
|
— | — | — | — | — | — | ||||||||||||||||||
Multi-family residential
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial and agricultural business loans
|
— | — | — | — | — | — | ||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||
Home equity/home improvement
|
7 | 102 | 9 | 188 | 16 | 290 | ||||||||||||||||||
Automobile
|
5 | 22 | 5 | 18 | 10 | 40 | ||||||||||||||||||
Other
|
9 | 32 | 7 | 6 | 16 | 38 | ||||||||||||||||||
Total loans
|
25 | $ | 592 | 36 | $ | 907 | 61 | $ | 1,499 | |||||||||||||||
At December 31, 2007
|
||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||
One- to four-family residential
|
1 | $ | 79 | 12 | $ | 610 | 13 | $ | 689 | |||||||||||||||
Commercial and agricultural
|
— | — | 1 | 102 | 1 | 102 | ||||||||||||||||||
Multi-family residential
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial and agricultural business loans
|
— | — | 2 | 115 | 2 | 115 | ||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||
Home equity/home improvement
|
5 | 76 | 4 | 78 | 9 | 154 | ||||||||||||||||||
Automobile
|
4 | 21 | 3 | 15 | 7 | 36 | ||||||||||||||||||
Other
|
3 | 23 | 4 | 6 | 7 | 29 | ||||||||||||||||||
Total loans
|
13 | $ | 199 | 26 | $ | 926 | 39 | $ | 1,125 |
Loans Delinquent For
|
||||||||||||||||||||||||
|
60-89 Days
|
90 Days and Over
|
Total
|
|||||||||||||||||||||
Number | Amount | Number | Amount | Number | Amount | |||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||
At December 31, 2006
|
||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||
One- to four-family residential
|
9 | $ | 323 | 6 | $ | 270 | 15 | $ | 593 | |||||||||||||||
Commercial and agricultural
|
— | — | 2 | 145 | 2 | 145 | ||||||||||||||||||
Multi-family residential
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial and agricultural business loans
|
— | — | 1 | 659 | 1 | 659 | ||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||
Home equity/home improvement
|
7 | 146 | 5 | 191 | 12 | 337 | ||||||||||||||||||
Automobile
|
2 | 1 | 1 | 1 | 3 | 2 | ||||||||||||||||||
Other
|
2 | 7 | 2 | 7 | 4 | 14 | ||||||||||||||||||
Total loans
|
20 | $ | 477 | 17 | $ | 1,273 | 37 | $ | 1,750 | |||||||||||||||
At December 31, 2005
|
||||||||||||||||||||||||
Real estate loans:
|
||||||||||||||||||||||||
One- to four-family residential
|
6 | $ | 155 | 9 | $ | 465 | 15 | $ | 620 | |||||||||||||||
Commercial and agricultural
|
— | — | 3 | 260 | 3 | 260 | ||||||||||||||||||
Multi-family residential
|
— | — | — | — | — | — | ||||||||||||||||||
Commercial and agricultural business loans
|
2 | 5 | — | — | 2 | 5 | ||||||||||||||||||
Consumer loans:
|
||||||||||||||||||||||||
Home equity/home improvement
|
6 | 134 | 5 | 213 | 11 | 347 | ||||||||||||||||||
Automobile
|
4 | 13 | 3 | 18 | 7 | 31 | ||||||||||||||||||
Other
|
3 | 12 | 3 | 30 | 6 | 42 | ||||||||||||||||||
Total loans
|
21 | $ | 319 | 23 | $ | 986 | 44 | $ | 1,305 |
12/31/09
|
12/31/08
|
|||||||
(In thousands)
|
||||||||
Special Mention loans
|
$ | 6,489 | $ | 7,369 | ||||
Substandard loans
|
4,865 | 2,388 | ||||||
Total Special Mention and Substandard loans
|
$ | 11,354 | $ | 9,757 |
●
|
changes in lending policies and procedures, including underwriting standards and collection practices;
|
●
|
changes in national and local economic and business conditions and developments, including the condition of various market segments;
|
●
|
changes in the nature and volume of the loan portfolio;
|
●
|
changes in the experience, ability and depth of management and the lending staff;
|
●
|
changes in the trend of the volume and severity of the past due, nonaccrual, and classified loans;
|
●
|
changes in the quality of our loan review system and the degree of oversight by the board of directors;
|
●
|
the existence of any concentrations of credit, and changes in the level of such concentrations; and
|
●
|
the effect of external factors, such as competition and legal and regulatory requirements on the level of estimated credit losses in our current portfolio.
|
For the Years Ended December 31,
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||
Balance at beginning of year
|
$ | 1,934 | $ | 1,766 | $ | 1,864 | $ | 1,846 | $ | 1,888 | ||||||||||
Charge-offs:
|
||||||||||||||||||||
One- to four-family residential
|
147 | 149 | 165 | 55 | 161 | |||||||||||||||
Commercial and agricultural real estate
|
112 | — | 38 | 30 | 53 | |||||||||||||||
Commercial and agricultural business
|
1,883 | — | 35 | 16 | 8 | |||||||||||||||
Home equity/home improvement
|
58 | 46 | 18 | 101 | 145 | |||||||||||||||
Automobile
|
20 | 8 | — | 2 | 30 | |||||||||||||||
Other consumer
|
23 | 3 | 45 | 14 | 36 | |||||||||||||||
Total charge-offs
|
2,243 | 206 | 301 | 218 | 433 | |||||||||||||||
Recoveries:
|
||||||||||||||||||||
One- to four-family residential
|
1 | 14 | 5 | 78 | 14 | |||||||||||||||
Commercial and agricultural real estate
|
4 | 15 | 6 | 8 | — | |||||||||||||||
Commercial and agricultural business
|
— | 16 | — | — | — | |||||||||||||||
Home equity/home improvement
|
4 | 4 | 3 | 34 | 98 | |||||||||||||||
Automobile
|
7 | 5 | 13 | 17 | 17 | |||||||||||||||
Other consumer
|
8 | 10 | 21 | 39 | 17 | |||||||||||||||
Total recoveries
|
24 | 64 | 48 | 176 | 146 | |||||||||||||||
Net loans charge-offs
|
2,219 | 142 | 253 | 42 | 287 | |||||||||||||||
Additions charged to operations
|
2,575 | 310 | 155 | 60 | 245 | |||||||||||||||
Balance at end of year
|
$ | 2,290 | $ | 1,934 | $ | 1,766 | $ | 1,864 | $ | 1,846 | ||||||||||
Total loans outstanding
|
$ | 176,042 | $ | 184,991 | $ | 177,662 | $ | 156,731 | $ | 144,293 | ||||||||||
Average net loans outstanding
|
$ | 182,813 | $ | 177,963 | $ | 165,715 | $ | 149,238 | $ | 137,740 | ||||||||||
Allowance for loan losses as a percentage of total loans at end of year
|
1.30 | % | 1.05 | % | 0.99 | % | 1.19 | % | 1.28 | % | ||||||||||
Net loans charged off as a percent of average net loans outstanding
|
1.21 | % | 0.08 | % | 0.15 | % | 0.03 | % | 0.21 | % | ||||||||||
Allowance for loan losses to non-performing loans
|
117.20 | % | 162.47 | % | 161.90 | % | 137.90 | % | 156.75 | % | ||||||||||
Allowance for loan losses to total non-performing assets at end of year
|
97.99 | % | 98.22 | % | 119.49 | % | 123.94 | % | 111.95 | % |
At December 31,
|
||||||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||||||
Amount
|
Percent of
Loans in Each
Category to
Total Loans
|
Amount
|
Percent of
Loans in Each
Category to
Total Loans
|
Amount
|
Percent of
Loans in Each
Category to
Total Loans
|
|||||||||||||||||||
(Dollars in Thousands)
|
||||||||||||||||||||||||
One- to four-family residential
|
$ | 392 | 21.9 | % | $ | 510 | 25.3 | % | $ | 595 | 28.4 | % | ||||||||||||
Commercial and agricultural real estate
|
739 | 32.2 | 537 | 30.6 | 346 | 24.8 | ||||||||||||||||||
Multi-family residential
|
73 | 2.5 | 12 | 2.4 | 28 | 2.7 | ||||||||||||||||||
Commercial and agricultural business
|
653 | 19.5 | 304 | 19.1 | 146 | 20.6 | ||||||||||||||||||
Home equity/home improvement
|
249 | 16.0 | 301 | 16.2 | 465 | 16.9 | ||||||||||||||||||
Automobile
|
26 | 3.5 | 33 | 3.2 | 74 | 3.0 | ||||||||||||||||||
Other consumer
|
62 | 4.4 | 52 | 3.2 | 112 | 3.6 | ||||||||||||||||||
Unallocated
|
96 | — | 185 | — | — | — | ||||||||||||||||||
Total
|
$ | 2,290 | 100 | % | $ | 1,934 | 100 | % | $ | 1,766 | 100 | % |
At December 31,
|
||||||||||||||||
2006
|
2005
|
|||||||||||||||
Amount
|
Percent of
Loans in Each
Category to
Total Loans
|
Amount
|
Percent of
Loans in Each
Category to
Total Loans
|
|||||||||||||
(Dollars in Thousands)
|
||||||||||||||||
One- to four-family residential
|
$ | 512 | 25.9 | % | $ | 448 | 27.8 | % | ||||||||
Commercial and agricultural real estate
|
244 | 25.3 | 199 | 23.4 | ||||||||||||
Multi-family residential
|
37 | 3.7 | 40 | 4.2 | ||||||||||||
Commercial and agricultural business
|
275 | 21.0 | 129 | 19.9 | ||||||||||||
Home equity/home improvement
|
561 | 17.3 | 785 | 18.3 | ||||||||||||
Automobile
|
96 | 3.4 | 110 | 3.2 | ||||||||||||
Other consumer
|
139 | 3.4 | 135 | 3.2 | ||||||||||||
Total
|
$ | 1,864 | 100 | % | $ | 1,846 | 100 | % |
At December 31,
|
||||||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||||||
Amortized
Cost |
Fair Value
|
Amortized
Cost |
Fair Value
|
Amortized
Cost |
Fair Value
|
|||||||||||||||||||
(In thousands)
|
||||||||||||||||||||||||
Mortgage-backed securities:
|
||||||||||||||||||||||||
Fannie Mae
|
$ | 10,646 | $ | 10,855 | $ | 14,422 | $ | 14,654 | $ | 7,439 | $ | 7,433 | ||||||||||||
Freddie Mac
|
6,938 | 7,096 | 6,085 | 6,192 | 4,561 | 4,536 | ||||||||||||||||||
Ginnie Mae
|
22,844 | 23,034 | 6,877 | 6,949 | 3,495 | 3,446 | ||||||||||||||||||
Total mortgage-backed securities
|
40,428 | 40,985 | 27,384 | 27,795 | 15,495 | 15,415 | ||||||||||||||||||
U.S. government and agencies
|
9,037 | 9,080 | 19,472 | 19,834 | 50,107 | 49,962 | ||||||||||||||||||
Municipal bonds
|
27,661 | 28,116 | 30,067 | 29,805 | 14,796 | 14,933 | ||||||||||||||||||
Total
|
$ | 77,126 | $ | 78,181 | $ | 76,923 | $ | 77,434 | $ | 80,398 | $ | 80,310 |
One Year or Less
|
More than One Year
through Five Years |
More than Five Years
through Ten Years |
More than Ten Years
|
Total Securities
|
||||||||||||||||||||||||||||||||||||||||
Amortized
Cost |
Weighted
Average Yield |
Amortized
Cost |
Weighted
Average Yield |
Amortized
Cost |
Weighted
Average Yield |
Amortized
Cost |
Weighted
Average Yield |
Amortized
Cost |
Fair Value
|
Weighted
Average Yield |
||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities:
|
||||||||||||||||||||||||||||||||||||||||||||
Fannie Mae
|
$ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 10,646 | 4.30 | % | $ | 10,646 | $ | 10,855 | 4.30 | % | ||||||||||||||||||||||
FreddieMac
|
— | — | — | — | — | — | 6,938 | 4.34 | 6,938 | 7,096 | 4.34 | |||||||||||||||||||||||||||||||||
Ginnie Mae
|
— | — | — | — | — | — | 22,844 | 4.13 | 22,844 | 23,034 | 4.13 | |||||||||||||||||||||||||||||||||
Total mortgage-backed securities
|
— | — | — | — | — | — | 40,428 | 4.21 | 40,428 | 40,985 | 4.21 | |||||||||||||||||||||||||||||||||
U.S. government and agencies
|
— | — | 1,000 | 4.25 | 5,481 | 4.35 | 2,556 | 3.84 | 9,037 | 9,080 | 4.20 | |||||||||||||||||||||||||||||||||
Municipal bonds
(1)
|
270 | 3.31 | 2,627 | 3.30 | 13,137 | 3.56 | 11,627 | 4.16 | 27,661 | 28,116 | 3.80 | |||||||||||||||||||||||||||||||||
Total
|
$ | 270 | 3.31 | % | $ | 3,627 | 3.59 | % | $ | 18,618 | 3.79 | % | $ | 54,611 | 4.18 | % | $ | 77,126 | $ | 78,181 | 4.06 | % | ||||||||||||||||||||||
(1)
|
We used an assumed 34% tax rate in computing tax equivalent adjustments. The tax equivalent yield of municipal bonds was 5.01% for maturities of one year or less, 5.00% for maturities of more than one year through five years, 5.40% for maturities for more than five years through ten years, 6.31% for maturities of more than 10 years and 5.76% for the total municipal bonds securities portfolio at December 31, 2009. The tax equivalent adjustments to interest income of municipal bonds was $5,000 for maturities of one year or less, $45,000 for maturities of more than one year through five years, $242,000 for maturities for more than five years through ten years, $250,000 for maturities of more than 10 years and $542,000 for the total municipal bonds securities portfolio for the year ended December 31, 2009.
|
For the Years Ended December 31,
|
||||||||||||||||||||||||||||||||||||
2009
|
2008
|
2007
|
||||||||||||||||||||||||||||||||||
Average
Balance |
Percent
|
Weighted
Average Rate |
Average
Balance |
Percent
|
Weighted
Average Rate |
Average
Balance |
Percent
|
Weighted
Average Rate |
||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||
Deposit type:
|
||||||||||||||||||||||||||||||||||||
Non-interest bearing checking
|
$ | 19,791 | 7.8 | % | — | % | $ | 18,479 | 7.5 | % | — | % | $ | 16,214 | 6.8 | % | — | % | ||||||||||||||||||
Interest-bearing checking
|
29,009 | 11.4 | 0.32 | % | 28,572 | 11.6 | 0.70 | % | 25,820 | 10.9 | 1.17 | % | ||||||||||||||||||||||||
Savings accounts
|
24,849 | 9.8 | 0.88 | % | 22,677 | 9.2 | 0.99 | % | 22,774 | 9.6 | 1.00 | % | ||||||||||||||||||||||||
Money market deposits
|
4,616 | 1.8 | 0.86 | % | 4,700 | 1.9 | 1.06 | % | 4,957 | 2.1 | 1.41 | % | ||||||||||||||||||||||||
Money market savings
|
26,750 | 10.5 | 1.41 | % | 24,442 | 9.9 | 2.39 | % | 22,502 | 9.4 | 4.40 | % | ||||||||||||||||||||||||
Certificates of deposit
|
149,124 | 58.7 | 3.08 | % | 147,891 | 59.9 | 4.13 | % | 145,325 | 61.2 | 4.71 | % | ||||||||||||||||||||||||
Total deposits
|
$ | 254,139 | 100.00 | % | 2.09 | % | $ | 246,761 | 100.00 | % | 2.90 | % | $ | 237,592 | 100.00 | % | 3.55 | % |
At December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(In thousands)
|
||||||||||||
Interest Rate:
|
||||||||||||
Less than 2.00%
|
$ | 51,683 | $ | 1,006 | $ | 129 | ||||||
2.00% to 2.99%
|
40,734 | 36,001 | 5,618 | |||||||||
3.00% to 3.99%
|
37,674 | 67,714 | 23,208 | |||||||||
4.00% to 4.99%
|
6,677 | 17,269 | 40,876 | |||||||||
5.00% to 5.99%
|
8,852 | 18,420 | 80,414 | |||||||||
6.00% to 6.99%
|
— | 86 | 88 | |||||||||
Total
|
$ | 145,620 | $ | 140,496 | $ | 150,333 |
At December 31, 2009 | ||||||||||||||||||||||||
Period to Maturity | ||||||||||||||||||||||||
Less Than or
Equal to One Year |
More Than
One to Two Years |
More Than
Two to Three Years |
More Than
Three Years |
Total
|
Percent of
Total |
|||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
Interest Rate Range:
|
||||||||||||||||||||||||
Less than 2.00%
|
$ | 44,055 | $ | 7,622 | $ | — | $ | 6 | $ | 51,683 | 35.5 | % | ||||||||||||
2.00% to 2.99%
|
29,580 | 9,000 | 1,686 | 468 | 40,734 | 27.9 | ||||||||||||||||||
3.00% to 3.99%
|
24,513 | 5,624 | 1,825 | 5,712 | 37,674 | 25.9 | ||||||||||||||||||
4.00% to 4.99%
|
3,686 | 1,780 | 954 | 257 | 6,677 | 4.6 | ||||||||||||||||||
5.00% to 5.99%
|
6,265 | 1,633 | 526 | 428 | 8,852 | 6.1 | ||||||||||||||||||
6.00% to 6.99%
|
— | — | — | — | — | — | ||||||||||||||||||
Total
|
$ | 108,099 | $ | 25,659 | $ | 4,991 | $ | 6,871 | $ | 145,620 | 100.00 | % |
At December 31, 2009
|
||||
(In Thousands)
|
||||
Three months or less
|
$ | 11,961 | ||
Over three months through six months
|
12,937 | |||
Over six months through one year
|
21,889 | |||
Over one year to three years
|
7,677 | |||
Over three years
|
3,662 | |||
Total
|
$ | 58,126 |
At or For the Years Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Balance at end of period
|
$ | — | $ | 13,500 | $ | 10,000 | ||||||
Average balance during period
|
$ | 5,349 | $ | 12,029 | $ | 8,629 | ||||||
Maximum outstanding at any month end
|
$ | 10,000 | $ | 21,000 | $ | 18,000 | ||||||
Weighted average interest rate at end of period
|
— | % | 2.59 | % | 4.98 | % | ||||||
Average interest rate during period
|
1.94 | % | 3.91 | % | 5.02 | % |
At or For the Years Ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(Dollars in thousands)
|
||||||||||||
Balance at end of period
|
$ | 3,789 | $ | 7,633 | $ | 4,936 | ||||||
Average balance during period
|
$ | 5,160 | $ | 6,031 | $ | 4,665 | ||||||
Maximum outstanding at any month end
|
$ | 6,920 | $ | 7,633 | $ | 5,838 | ||||||
Weighted average interest rate at end of period
|
0.24 | % | 0.03 | % | 2.89 | % | ||||||
Average interest rate during period
|
0.19 | % | 1.29 | % | 4.26 | % |
Net
|
|||||||||
Book Value
|
|||||||||
Year
|
at December 31,
|
||||||||
Location
|
Occupied
|
2009
|
|||||||
(In Thousands)
|
|||||||||
Main Office
|
|||||||||
1211 West Morton Avenue
|
|||||||||
Jacksonville, Illinois
|
1994 | $ | 3,727 | ||||||
Branch Office
(1)
|
|||||||||
211 West State Street
|
|||||||||
Jacksonville, Illinois
|
1961 | 603 | |||||||
Branch Office
(1)
|
|||||||||
903 South Main
|
|||||||||
Jacksonville, Illinois
|
1989 | 184 | |||||||
Branch Office
|
|||||||||
501 North State Street
|
|||||||||
Litchfield, Illinois
|
1997 | 573 | |||||||
Branch Office
|
|||||||||
100 North Dye
|
|||||||||
Virden, Illinois
|
1986 | 185 | |||||||
Branch Office
|
|||||||||
510 Superior
|
|||||||||
Chapin, Illinois
|
2000 | 465 | |||||||
Branch Office
(1)
|
|||||||||
202 State
|
|||||||||
Concord, Illinois
|
2000 | 29 |
|
(i)
|
be made on terms that are substantially the same as, and follow credit underwriting procedures that are not less stringent than, those prevailing for comparable transactions with unaffiliated persons and that do not involve more than the normal risk of repayment or present other unfavorable features, and
|
|
(ii)
|
not exceed certain limitations on the amount of credit extended to such persons, individually and in the aggregate, which limits are based, in part, on the amount of Jacksonville Savings Bank’s capital.
|
●
|
Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers;
|
●
|
Home Mortgage Disclosure Act, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves;
|
●
|
Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit;
|
●
|
Fair Credit Reporting Act, governing the use and provision of information to credit reporting agencies;
|
●
|
Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies;
|
●
|
Truth in Savings Act;
|
●
|
Illinois High Risk Home Loan Act, which protects borrowers who enter into high risk home loans;
|
●
|
Illinois Predatory Lending Database Program, which helps provide counseling for homebuyers in connection with certain loans; and
|
●
|
rules and regulations of the various federal and state agencies charged with the responsibility of implementing such laws.
|
●
|
Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records;
|
●
|
Electronic Funds Transfer Act and Regulation E promulgated thereunder, which govern automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services;
|
●
|
Check Clearing for the 21
st
Century Act (also known as “Check 21”), which gives “substitute checks,” such as digital check images and copies made from that image, the same legal standing as the original paper check;
|
●
|
The USA PATRIOT Act, which requires savings banks operating to, among other things, establish broadened anti-money laundering compliance programs, due diligence policies and controls to ensure the detection and reporting of money laundering. Such required compliance programs are intended to supplement existing compliance requirements, also applicable to financial institutions, under the Bank Secrecy Act and the Office of Foreign Assets Control regulations; and
|
●
|
The Gramm-Leach-Bliley Act, which places limitations on the sharing of consumer financial information by financial institutions with unaffiliated third parties. Specifically, the Gramm-Leach-Bliley Act requires all financial institutions offering financial products or services to retail customers to provide such customers with the financial institution’s privacy policy and provide such customers the opportunity to “opt out” of the sharing of certain personal financial information with unaffiliated third parties.
|
|
(i)
|
the approval of interstate supervisory acquisitions by savings and loan holding companies; and
|
|
(ii)
|
the acquisition of a savings institution in another state if the laws of the state of the target savings institution specifically permit such acquisition.
|
Name
|
Age
|
Position
|
||
Andrew F. Applebee
|
60
|
Chairman of the Board of Directors
|
||
Richard A. Foss
|
59
|
President, Chief Executive Officer and Director
|
||
Diana S. Tone
|
41
|
Chief Financial Officer
|
||
John C. Williams
|
60
|
Senior Vice President, Trust Officer and Director
|
||
John D. Eilering
|
47
|
Vice President of Operations and Secretary
|
||
Laura A. Marks
|
51
|
Senior Vice President of Retail Banking
|
||
Chris A. Royal
|
54
|
Vice President and Chief Lending Officer
|
Name(1)
|
Position(s) Held With
Jacksonville Bancorp-
Maryland |
Age
|
Director
Since
|
Current Term
Expires
|
||||
Andrew F. Applebee
|
Chairman of the Board of Directors
|
60
|
1982
|
2013
|
||||
Emily J. Osburn
|
Director
|
68
|
1982
|
2013
|
||||
Dean H. Hess
|
Director
|
61
|
2000
|
2011
|
||||
John C. Williams
|
Director, Senior Vice
President and Trust Officer |
60
|
2000
|
2011
|
||||
Harmon B. Deal, III
|
Director
|
49
|
2003
|
2011
|
||||
John L. Eyth
|
Director
|
58
|
2005
|
2012
|
||||
Richard A. Foss
|
President, Chief Executive
Officer and Director |
59
|
1993
|
2012
|
||||
John M. Buchanan
|
Director
|
58
|
2009
|
2012
|
Nominating
|
Compensation
|
Audit
|
||||||||||
Emily J. Osburn
|
X | X | ||||||||||
Dean H. Hess
|
X* | X | X | |||||||||
Harmon B. Deal, III
|
X | X* | ||||||||||
John L. Eyth
|
X | X | X* | |||||||||
John M. Buchanan
|
X | X | X | |||||||||
Meetings in Fiscal 2009
|
1 | 1 | 4 |
*
|
Denotes committee chair as of December 31, 2009.
|
Summary Compensation Table (3)
|
||||||||||||||||||||||||
Name and
Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Change in pension value and non-qualified deferred compensation earnings (1)
($)
|
All other compensation (2) ($)
|
Total
($)
|
||||||||||||||||||
Richard A. Foss,
President and Chief Executive Officer |
2009
2008
|
185,016
156,000
|
12,900
12,000
|
42,529
37,902 |
24,98 5
23,379
|
265,430
229,281
|
||||||||||||||||||
John C. Williams
Senior Vice President
and Trust Officer |
2009
2008
|
104,520
100,750
|
7,200
6,700
|
41,73 2
39,056 |
13,604
13,464
|
167,05 6
159,970
|
||||||||||||||||||
Chris A. Royal
Vice President and
Chief Lending Officer |
2009
2008
|
114,348
108,914 |
9,000
8,600
|
12,943
12,192 |
5,031
2,732
|
141,322
132,438
|
|
(1)
|
Amounts reported include the change in pension value for Messrs. Foss, Williams and Royal of $28,152, $32,251, and $12,943, respectively, for 2009 and $26,516, $30,378, and $12,192, respectively, for 2008 under the Jacksonville Savings Bank Salary Continuation Plan 1. Mr. Williams also received a change in pension value of $8,89 8 for 2009 and $8,216for 2008 under his deferred compensation agreements with Chapin State Bank that were assumed by Jacksonville Bancorp-Federal in the acquisition of Chapin State Bank on July 3, 2000. In addition, amounts reported for Messrs. Foss and Williams include non-qualified deferred compensation earnings of $14,377 and $583, respectively, for 2009 and $11,386 and $462, respectively, for 2008 under the Jacksonville Savings Bank Long-Term Deferred Compensation Plan.
|
|
(2)
|
All other compensation in 2009 consisted of our matching contributions under the 401(k) Profit Sharing Plan and life insurance premiums paid by Jacksonville Bancorp-Federal. This amounted to $9,134, $4,604, and $5,031 for Messrs. Foss, Williams and Royal, respectively. All other compensation in 2009 for Messrs. Foss and Williams also included board fees from Jacksonville Bancorp-Federal totaling $10,500 and $9,000, respectively. In addition, in 2009 Mr. Foss was reimbursed $5,35 1 to pay for family health insurance coverage. All other compensation in 2008 consisted of our matching contributions under the 401(k) Profit Sharing Plan and life insurance premiums paid by Jacksonville Bancorp-Federal. This amounted to $8,076, $4,464, and $2,732 for Mr. Foss, Mr. Williams and Mr. Royal, respectively. All other compensation in 2008 for Messrs. Foss and Williams also included board fees from Jacksonville Bancorp-Federal totaling $10,500 and $9,000, respectively. In addition, in 2008 Mr. Foss was reimbursed $4,803 to pay for family health insurance coverage.
|
|
(3)
|
During the year ended December 31, 2009 no stock or option awards were granted to the named executive officers in 2009.
|
(1)
|
the failure to elect or reelect or appoint or reappoint the executive to his current position with Jacksonville Bancorp-Federal and Jacksonville Savings Bank, or for Mr. Applebee, the failure to elect or reelect the executive as the Chairman of the Board;
|
(2)
|
a material change in the executive’s duties that are in effect as of the effective date of the agreement that would cause the executive’s position to become one of lesser responsibility or importance or a material reduction in the benefits and perquisites being provided to the executive;
|
(3)
|
a relocation of the executive’s principal place of employment by more than 30 miles from his current location;
|
(4)
|
liquidation or dissolution of Jacksonville Bancorp-Federal or Jacksonville Savings Bank other than liquidations or dissolutions that are caused by reorganizations that do not affect the status of the executive; or
|
(5)
|
any breach of the employment agreement.
|
(1)
|
the failure to elect or reelect or appoint or reappoint the executive to his current position with Jacksonville Savings Bank;
|
(2)
|
a material change in the executive’s duties that are in effect as of the effective date of the agreement that would cause the executive’s position to become one of lesser responsibility or importance;
|
(3)
|
liquidation or dissolution of Jacksonville Bancorp-Federal or Jacksonville Savings Bank other than liquidations or dissolutions that are caused by reorganizations that do not affect the status of the executive; or
|
(4)
|
any breach of the employment agreement.
|
(1) | the failure to elect or reelect or appoint or reappoint the executive to her current position with Jacksonville Bancorp-Maryland and Jacksonville Savings Bank, | |
(2) |
a material change in the executive’s position to become one of lesser responsibility or importance than the position the executive held immediately prior to the change in control, or a material reduction in the benefits and perquisites provided to the executive from those being provided immediately prior to the change in control;
|
|
(3) |
a relocation of the executive’s principal place of employment by more than 30 miles from her current location,
|
|
(4) | liquidation or dissolution of Jacksonville Bancorp-Maryland or Jacksonville Savings Bank other than liquidations or dissolutions that are caused by reorganizations that do not affect the status of the executive; or | |
(5) |
any breach of the agreement by Jacksonville Savings Bank.
|
Outstanding Equity Awards at Fiscal Year-End (2)
|
||||||||||||||||||||
Option awards
|
||||||||||||||||||||
Name
|
Number of
securities underlying unexercised options (#) exercisable (1) |
Number of
securities underlying unexercised options (#) unexercisable |
Equity
incentive plan awards: number of securities underlying unexercised earned options (#) |
Option
exercise price ($) |
Option
expiration Date |
|||||||||||||||
|
||||||||||||||||||||
Richard A. Foss,
President and Chief Executive Officer |
— | — | — | — | — | |||||||||||||||
|
||||||||||||||||||||
John C. Williams
Senior Vice President
and Trust Officer |
4,383 | — | — | 10.00 |
04/30/2011
|
|||||||||||||||
|
||||||||||||||||||||
Chris A. Royal
Vice President and Chief Lending Officer |
— | — | — | — | — |
(1) |
Represents options granted under the Jacksonville Savings Bank 2001 Stock Option Plan.
|
|
(2) |
There are no outstanding unvested stock awards under the Jacksonville Savings Bank and Jacksonville Bancorp, MHC 1996 Recognition and Retention Plan.
|
Director Compensation(3)(4)
|
||||||||||||||||
Name
|
Fees earned
or paid in cash
($)
|
Change in pension
value and non- qualified deferred compensation earnings (1) ($) |
All other
compensation (2) ($) |
Total
($) |
||||||||||||
Andrew F. Applebee
|
10,500 | 48,916 | 52,952 | 112,368 | ||||||||||||
John M. Buchanan
|
9,150 | — | — | 9,150 | ||||||||||||
Harmon B. Deal, III
|
10,615 | — | — | 10,615 | ||||||||||||
John L. Eyth
|
11,105 | — | — | 11,105 | ||||||||||||
Dean H. Hess
|
10,775 | 8,576 | — | 19,351 | ||||||||||||
Emily J. Osburn
|
9,725 | — | — | 9,725 |
|
(1)
|
Amounts reported in 2009 consisted of a $26,375 change in pension value for Mr. Applebee under the Salary Continuation Plan 1 and $22,541 in above market earnings on his deferred compensation under the Long-Term Deferred Compensation Plan. Mr. Hess also received a change in pension value under his deferred compensation agreements with Chapin State Bank that were assumed by Jacksonville Bancorp-Federal in the acquisition of Chapin State Bank on July 3, 2000.
|
|
(2)
|
All other compensation for Mr. Applebee includes salary of $42,016 under his employment agreement , bonus of $3,200, matching contributions of $1,943 under our 401(k) Plan, health insurance premiums of $5,351 and life insurance premiums of $442. Please see descriptions of the employment agreement and 401(k) Plan under the “Executive Compensation -Summary Compensation Table” for further details.
|
|
(3)
|
No stock awards, option grants or non-equity incentive plan compensation awards was made to the directors during 2009.
|
|
(4)
|
As of December 31, 2009, the directors have the following outstanding equity awards: Mr. Deal has 1,200 option awards and Ms. Osburn has 1,200 option awards.
|
●
|
non-employee directors in the aggregate may not receive more than 30% of the options and restricted stock awards authorized under the plan;
|
●
|
any one non-employee director may not receive more than 5% of the options and restricted stock awards authorized under the plan;
|
●
|
any officer or employee may not receive more than 25% of the options and restricted stock awards authorized under the plan;
|
●
|
any tax-qualified employee stock benefit plans and management stock benefit plans, in the aggregate, may not hold more than 10% of the shares sold in the offering, unless Jacksonville Savings Bank has tangible capital of 10% or more, in which case any tax-qualified employee stock benefit plans and management stock benefit plans, may be increased to up to 12% of the shares sold in the offering;
|
●
|
the options and restricted stock awards may not vest more rapidly than 20% per year, beginning on the first anniversary of stockholder approval of the plan;
|
●
|
accelerated vesting is not permitted except for death, disability or upon a change in control of Jacksonville Savings Bank or Jacksonville Bancorp-Maryland; and
|
●
|
our executive officers or directors must exercise or forfeit their options in the event that Jacksonville Savings Bank becomes critically undercapitalized, is subject to enforcement action or receives a capital directive.
|
Name of Beneficial Owner
|
Total Shares
Beneficially Owned (1) |
Percent of
All Common Stock Outstanding |
||||||
Directors:
|
||||||||
Andrew F. Applebee
|
67,332 | (2) | 3.5 | % | ||||
Emily J. Osburn
|
11,600 | (3) | * | |||||
Dean H. Hess
|
29,000 | (4) | 1.5 | % | ||||
John C. Williams
|
14,397 | (5) | * | |||||
Harmon B. Deal, III
|
22,550 | (6) | 1.2 | % | ||||
John L. Eyth
|
4,011 | (7) | * | |||||
Richard A. Foss
|
59,843 | (8) | 3.1 | % | ||||
John M. Buchanan
|
1,000 | (9) | * | |||||
Executive Officers Other
Than Directors:
|
||||||||
John D. Eilering
|
11,835 | (10) | * | |||||
Diana S. Tone
|
3,701 | (11) | * | |||||
Laura A Marks
|
1,101 | (12) | * | |||||
Chris A. Royal
|
— | — | ||||||
All directors and executive officers as a group (12 persons)
|
226,369 | 11.8 | % | |||||
Jacksonville Bancorp, MHC
1211 West Morton Avenue,
Jacksonville, Illinois 62650
|
1,038,738 | 54.1 | % | |||||
Jacksonville Bancorp, MHC and all directors and executive officers as a group
|
1,265,107 | 65.9 | % |
(*)
|
Less than 1%.
|
|
(1)
|
Shares of common stock are held directly unless indicated otherwise.
|
|
(2)
|
Mr. Applebee has shared voting and investment power over 24,163 shares and sole voting and investment power over 43,169 shares; includes 5,100 shares awarded pursuant to our restricted stock plan.
|
|
(3)
|
Ms. Osburn has sole voting and investment power over 11,600 shares; includes 600 shares awarded pursuant to our restricted stock plan.
|
|
(4)
|
Mr. Hess has shared voting and investment power over 11,480 shares of common stock and sole voting power over 17,520 shares.
|
|
(5)
|
Mr. Williams has sole voting and investment power over 14,397 shares of common stock, including options to purchase 4,383 shares of common stock.
|
|
(6)
|
Mr. Deal has sole voting and investment power over 22,550 shares of common stock, including options to purchase 1,200 shares of common stock.
|
|
(7)
|
Mr. Eyth has sole voting and investment power over 4,011 shares of common stock.
|
|
(8)
|
Mr. Foss has shared voting and investment power over 16,600 shares and sole voting and investment power over 43,243 shares; includes 4,800 shares awarded pursuant to our restricted stock plan.
|
|
(9)
|
Mr. Buchanan has sole voting and investment power over 1,000 shares.
|
(10)
|
Mr. Eilering has sole voting and investment power over 11,835 shares of common stock, including options to purchase 3,000 shares of common stock.
|
|
(11)
|
Ms. Tone has sole voting and investment power over 3,701 shares of common stock, including options to purchase 1,100 shares of common stock.
|
|
(12)
|
Ms. Marks has sole voting and investment power over 1,101 shares of common stock.
|
(i)
|
the number of exchange shares to be held upon consummation of the conversion, based upon their beneficial ownership of Jacksonville Bancorp-Federal common stock as of May 10, 2010 ;
|
(ii)
|
the proposed purchases of subscription shares, assuming sufficient shares of common stock are available to satisfy their subscriptions; and
|
(iii)
|
the total amount of Jacksonville Bancorp-Maryland common stock to be held upon consummation of the conversion.
|
*
|
Less than 1%.
|
(1)
|
Includes proposed subscriptions, if any, by associates and proposed purchases to be made through the 401(k) plan.
|
(2)
|
Based on information presented in “Beneficial Ownership of Common Stock” assuming an exchange ratio of 1.1312 at the midpoint of the offering range.
|
(3)
|
Based upon 2,172,790 total shares outstanding at the midpoint of the offering range.
|
(i)
|
Natural persons (including trusts of natural persons) and then other persons (including any corporation, partnership, association, joint-stock company, limited liability company, trust, unincorporated organization, or government or political subdivision of a government) residing in the counties of Cass, Greene, Macoupin, Montgomery, Morgan, Pike, Sangamon and Scott, Illinois; and
|
(ii)
|
Jacksonville Bancorp-Federal’s public stockholders as of May 10, 2010 .
|
●
|
to increase our capital to support internal growth through lending in the communities we serve;
|
●
|
to enhance existing products and services and support the development of new products and services;
|
●
|
to facilitate growth through branch and whole bank acquisitions, as opportunities arise;
|
●
|
to improve our overall competitive position; and
|
●
|
to improve the liquidity of our shares of common stock and enhance stockholder returns through more flexible capital management strategies.
|
Shares of Jacksonville Bancorp-
Maryland to be Issued for Shares of Jacksonville Bancorp- Federal |
Total Shares of
Common Stock to be Issued in Conversion and Offering |
Equivalent
Value of Shares Based Upon Current Market Price (1) |
Shares to be
Received for 100 Existing Shares |
|||||||||||||||||||||||||||||
Shares to be Sold in This
Offering |
||||||||||||||||||||||||||||||||
Exchange
Ratio |
||||||||||||||||||||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||||||||||||||||||
Minimum
|
998,750 | 54.08 | % | 848,122 | 45.92 | % | 1,846,872 | 0.9615 | $ | 9.62 | 96 | |||||||||||||||||||||
Midpoint
|
1,175,000 | 54.08 | 997,790 | 45.92 | 2,172,790 | 1.1312 | 11.31 | 113 | ||||||||||||||||||||||||
Maximum
|
1,351,250 | 54.08 | 1,147,459 | 45.92 | 2,498,709 | 1.3009 | 13.01 | 130 | ||||||||||||||||||||||||
15% above Maximum
|
1,553,938 | 54.08 | 1,319,578 | 45.92 | 2,873,515 | 1.4960 | 14.96 | 149 |
(1)
|
Represents the value of shares of Jacksonville Bancorp-Maryland common stock received in the conversion by a holder of one share of Jacksonville Bancorp-Federal, at the exchange ratio, assuming the market price of $10.00 per share.
|
●
|
the present results and financial condition of Jacksonville Bancorp-Federal and the projected results and financial condition of Jacksonville Bancorp-Maryland;
|
●
|
the economic and demographic conditions in Jacksonville Bancorp-Federal’s existing market area;
|
●
|
certain historical, financial and other information relating to Jacksonville Bancorp-Federal;
|
●
|
a comparative evaluation of the operating and financial characteristics of Jacksonville Bancorp-Federal with those of other similarly situated publicly traded savings institutions located in Illinois and other states in the Midwestern United States;
|
●
|
the aggregate size of the offering of the shares of common stock;
|
●
|
the impact of the conversion and offering on Jacksonville Bancorp-Federal’s stockholders’ equity and earnings potential;
|
●
|
the proposed dividend policy of Jacksonville Bancorp-Maryland; and
|
●
|
the trading market for securities of comparable institutions and general conditions in the market for such securities.
|
●
|
Jacksonville Bancorp-Federal’s financial condition and results of operations;
|
●
|
comparison of financial performance ratios of Jacksonville Bancorp-Federal to those of other financial institutions of similar size;
|
●
|
market conditions generally and in particular for financial institutions; and
|
●
|
the historical trading price of the publicly held shares of Jacksonville Bancorp-Federal common stock.
|
(i)
|
Natural persons (including trusts of natural persons) and then other persons (including any corporation, partnership, association, joint-stock company, limited liability company, trust, unincorporated organization, or government or political subdivision of a government) residing in the counties of Cass, Greene, Macoupin, Montgomery, Morgan, Pike, Sangamon and Scott, Illinois;
|
(ii)
|
Jacksonville Bancorp-Federal’s public stockholders as of
May 10, 2010
; and
|
(iii)
|
Other members of the general public.
|
(i)
|
No person may purchase fewer than 25 shares of common stock or more than 25,000 shares ($250,000);
|
(ii)
|
Tax qualified employee benefit plans, including our employee stock ownership plan and 401(k) plan, may purchase in the aggregate up to 10% of the shares of common stock issued in the offering, including shares issued in the event of an increase in the offering range of up to 15%;
|
(iii)
|
Except for the employee stock ownership plan and 401(k) plan, as described above, no person or entity, together with associates or persons acting in concert with such person or entity, may purchase more than 50,000 shares ($500,000) in all categories of the offering combined;
|
(iv)
|
Current stockholders of Jacksonville Bancorp-Federal are subject to an ownership limitation. As previously described, current stockholders of Jacksonville Bancorp-Federal will receive shares of Jacksonville Bancorp-Maryland common stock in exchange for their existing shares of Jacksonville Bancorp-Federal common stock. The number of shares of common stock that a stockholder may purchase in the offering, together with associates or persons acting in concert with such stockholder, when combined with the shares that the stockholder and his or her associates will receive in exchange for existing Jacksonville Bancorp-Federal common stock, may not exceed 5% of the shares of common stock of Jacksonville Bancorp-Maryland to be issued and outstanding at the completion of the conversion; and
|
(v)
|
The maximum number of shares of common stock that may be purchased in all categories of the offering by senior officers and directors of Jacksonville Savings Bank and their associates, in the aggregate, when combined with shares of common stock issued in exchange for existing shares, may not exceed 30% of the shares issued in the conversion.
|
(i)
|
to fill the subscriptions of our tax-qualified employee benefit plans, including the employee stock ownership plan, for up to 10% of the total number of shares of common stock issued in the offering;
|
(ii)
|
in the event that there is an oversubscription at the Eligible Account Holder, Supplemental Eligible Account Holder or Other Depositor levels, to fill unfilled subscriptions of these subscribers according to their respective priorities; and
|
(iii)
|
to fill unfilled subscriptions in the community offering, with preference given first to natural persons residing in the counties of Cass, Greene, Macoupin, Montgomery, Morgan, Pike, Sangamon and Scott, Illinois, then to Jacksonville Bancorp-Federal’s public stockholders as of
May 10, 2010
and then to members of the general public.
|
(i)
|
any corporation or organization, other than Jacksonville Bancorp-Federal, Jacksonville Savings Bank or a majority-owned subsidiary of Jacksonville Savings Bank, of which the person is a senior officer, partner or 10% beneficial stockholder;
|
(ii)
|
any trust or other estate in which the person has a substantial beneficial interest or serves as a trustee or in a similar fiduciary capacity; provided, however, it does not include any employee stock benefit plan in which the person has a substantial beneficial interest or serves as trustee or in a similar fiduciary capacity; and
|
(iii)
|
any blood or marriage relative of the person, who either has the same home as the person or who is a director or officer of Jacksonville Bancorp-Federal or Jacksonville Savings Bank.
|
(i)
|
knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant to an express agreement; or
|
(ii)
|
a combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise.
|
●
|
provide advice on the financial and securities market implications of the plan of conversion and reorganization and related corporate documents, including our business plan;
|
●
|
assist in structuring our stock offering, including developing and assisting in implementing a market strategy for the stock offering;
|
●
|
review all offering documents, including this prospectus, stock order forms and related offering materials (we are responsible for the preparation and filing of such documents);
|
●
|
assist us in preparing for and scheduling meetings with potential investors and broker-dealers, as necessary;
|
●
|
assist us in analyzing proposals from outside vendors retained in connection with the stock offering, including printers, transfer agents and appraisal firms;
|
●
|
assist us in the drafting and distribution of press releases as required or appropriate in connection with the stock offering;
|
●
|
meet with the board of directors and management to discuss any of these services; and
|
●
|
provide such other financial advisory and investment banking services in connection with the stock offering as may be agreed upon by Keefe, Bruyette & Woods, Inc. and us.
|
●
|
consolidate accounts and develop a central file;
|
●
|
prepare proxy forms and proxy materials;
|
●
|
tabulate proxies and ballots;
|
●
|
act as inspector of election at the special meeting of members;
|
●
|
assist us in establishing and managing the Stock Information Center;
|
●
|
assist our financial printer with labeling of stock offering materials;
|
●
|
process stock order forms and certification forms and produce daily reports and analysis;
|
●
|
assist our transfer agent with the generation and mailing of stock certificates;
|
●
|
advise us on interest and refund calculations; and
|
●
|
create tax forms for interest reporting.
|
(i)
|
personal check, bank check or money order, made payable to Jacksonville Bancorp, Inc.; or
|
(ii)
|
authorizing us to withdraw funds from Jacksonville Savings Bank savings and certificate of deposit accounts (not checking accounts) designated on the stock order form.
|
1. |
The merger of Jacksonville Bancorp, MHC with and into Jacksonville Bancorp-Federal will qualify as a tax-free reorganization within the meaning of Section 368(a)(1)(A) of the Internal Revenue Code.
|
2. |
The constructive exchange of Eligible Account Holders’ and Supplemental Eligible Account Holders’ liquidation interests in Jacksonville Bancorp, MHC for liquidation interests in Jacksonville Bancorp-Federal will satisfy the continuity of interest requirement of Section 1.368-1(b) of the Federal Income Tax Regulations.
|
3. |
None of Jacksonville Bancorp, MHC, Jacksonville Bancorp-Federal, Eligible Account Holders nor Supplemental Eligible Account Holders, will recognize any gain or loss on the transfer of the assets of Jacksonville Bancorp, MHC to Jacksonville Bancorp-Federal in constructive exchange for a liquidation interest established in Jacksonville Bancorp-Federal for the benefit of such persons who remain depositors of Jacksonville Savings Bank.
|
4. |
The basis of the assets of Jacksonville Bancorp, MHC and the holding period of such assets to be received by Jacksonville Bancorp-Federal will be the same as the basis and holding period of such assets in Jacksonville Bancorp, MHC immediately before the exchange.
|
5. |
The merger of Jacksonville Bancorp-Federal with and into Jacksonville Bancorp-Maryland will constitute a mere change in identity, form or place of organization within the meaning of Section 368(a)(1)(F) of the Code and therefore will qualify as a tax-free reorganization within the meaning of Section 368(a)(1)(F) of the Code. Neither Jacksonville Bancorp-Federal nor Jacksonville Bancorp-Maryland will recognize gain or loss as a result of such merger.
|
6. | The basis of the assets of Jacksonville Bancorp-Federal and the holding period of such assets to be received by Jacksonville Bancorp-Maryland will be the same as the basis and holding period of such assets in Jacksonville Bancorp-Federal immediately before the exchange. |
7. |
Current stockholders of Jacksonville Bancorp-Federal will not recognize any gain or loss upon their exchange of Jacksonville Bancorp-Federal common stock for Jacksonville Bancorp-Maryland common stock.
|
8.
|
Eligible Account Holders and Supplemental Eligible Account Holders will not recognize any gain or loss upon the constructive exchange of their liquidation interests in Jacksonville Bancorp-Federal for interests in the liquidation account in Jacksonville Bancorp-Maryland.
|
9. |
The constructive exchange of the Eligible Account Holders and Supplemental Eligible Account Holders liquidation interests in Jacksonville Bancorp-Federal for interests in the liquidation account established in Jacksonville Bancorp-Maryland will satisfy the continuity of interest requirement of Section 1.368-1(b) of the Federal Income Tax Regulations.
|
10. |
Each stockholder’s aggregate basis in shares of Jacksonville Bancorp-Maryland common stock (including fractional share interests) received in the exchange will be the same as the aggregate basis of Jacksonville Bancorp-Federal common stock surrendered in the exchange.
|
11. |
Each stockholder’s holding period in his or her Jacksonville Bancorp-Maryland common stock received in the exchange will include the period during which the Jacksonville Bancorp-Federal common stock surrendered was held, provided that the Jacksonville Bancorp-Federal common stock surrendered is a capital asset in the hands of the stockholder on the date of the exchange.
|
12. |
Cash received by any current stockholder of Jacksonville Bancorp-Federal in lieu of a fractional share interest in shares of Jacksonville Bancorp-Maryland common stock will be treated as having been received as a distribution in full payment in exchange for a fractional share interest of Jacksonville Bancorp-Maryland common stock, which such stockholder would otherwise be entitled to receive. Accordingly, a stockholder will recognize gain or loss equal to the difference between the cash received and the basis of the fractional share. If the common stock is held by the stockholder as a capital asset, the gain or loss will be capital gain or loss.
|
13. |
It is more likely than not that the fair market value of the nontransferable subscription rights to purchase Jacksonville Bancorp-Maryland common stock is zero. Accordingly, no gain or loss will be recognized by Eligible Account Holders, Supplemental Eligible Account Holders or Other Depositors upon distribution to them of nontransferable subscription rights to purchase shares of Jacksonville Bancorp-Maryland common stock. Eligible Account Holders, Supplemental Eligible Account Holders and Other Depositors will not realize any taxable income as the result of the exercise by them of the nontransferable subscriptions rights.
|
14. |
It is more likely than not that the fair market value of the benefit provided by the liquidation account of Jacksonville Savings Bank supporting the payment of the Jacksonville Bancorp-Maryland liquidation account in the event Jacksonville Bancorp-Maryland lacks sufficient net assets is zero. Accordingly, it is more likely than not that no gain or loss will be recognized by Eligible Account Holders and Supplemental Eligible Account Holders upon the constructive distribution to them of such rights in the Jacksonville Savings Bank liquidation account as of the effective date of the merger of Jacksonville Bancorp-Federal with and into Jacksonville Bancorp-Maryland.
|
15. |
It is more likely than not that the basis of the shares of Jacksonville Bancorp-Maryland common stock purchased in the offering by the exercise of nontransferable subscription rights will be the purchase price. The holding period of the Jacksonville Bancorp-Maryland common stock purchased pursuant to the exercise of nontransferable subscription rights will commence on the date on which the right to acquire such stock was exercised.
|
16. |
No gain or loss will be recognized by Jacksonville Bancorp-Maryland on the receipt of money in exchange for Jacksonville Bancorp-Maryland common stock sold in the offering.
|
(i)
|
it does not involve an interim savings institution;
|
(ii)
|
Jacksonville Bancorp-Federal’s federal stock charter is not changed;
|
(iii)
|
each share of Jacksonville Bancorp-Federal’s stock outstanding immediately prior to the effective date of the transaction will be an identical outstanding share or a treasury share of Jacksonville Bancorp-Federal after such effective date; and
|
(iv)
|
either:
|
(a)
|
no shares of voting stock of Jacksonville Bancorp-Federal and no securities convertible into such stock are to be issued or delivered under the plan of combination; or
|
(b)
|
the authorized but unissued shares or the treasury shares of voting stock of Jacksonville Bancorp-Federal to be issued or delivered under the plan of combination, plus those initially issuable upon conversion of any securities to be issued or delivered under such plan, do not exceed 15% of the total shares of voting stock of Jacksonville Bancorp-Federal outstanding immediately prior to the effective date of the transaction.
|
●
|
the economic effect, both immediate and long-term, upon Jacksonville Bancorp-Maryland’s stockholders, including stockholders, if any, who do not participate in the transaction;
|
●
|
the social and economic effect on the present and future employees, creditors and customers of, and others dealing with, Jacksonville Bancorp-Maryland and its subsidiaries and on the communities in which Jacksonville Bancorp-Maryland and its subsidiaries operate or are located;
|
●
|
whether the proposal is acceptable based on the historical, current or projected future operating results or financial condition of Jacksonville Bancorp-Maryland;
|
●
|
whether a more favorable price could be obtained for Jacksonville Bancorp-Maryland’s stock or other securities in the future;
|
●
|
the reputation and business practices of the other entity to be involved in the transaction and its management and affiliates as they would affect the employees of Jacksonville Bancorp-Maryland and its subsidiaries;
|
●
|
the future value of the stock or any other securities of Jacksonville Bancorp-Maryland or the other entity to be involved in the proposed transaction;
|
●
|
any antitrust or other legal and regulatory issues that are raised by the proposal;
|
●
|
the business and historical, current or expected future financial condition or operating results of the other entity to be involved in the transaction, including, but not limited to, debt service and other existing financial obligations, financial obligations to be incurred in connection with the proposed transaction, and other likely financial obligations of the other entity to be involved in the proposed transaction; and
|
●
|
the ability of Jacksonville Bancorp-Maryland to fulfill its objectives as a financial institution holding company and on the ability of its subsidiary financial institution(s) to fulfill the objectives of a federally insured financial institution under applicable statutes and regulations.
|
(i) |
The limitation on voting rights of persons who directly or indirectly beneficially own more than 10% of the outstanding shares of common stock;
|
|
(ii) |
The division of the board of directors into three staggered classes;
|
|
(iii) |
The ability of the board of directors to fill vacancies on the board;
|
|
(iv) |
The requirement that directors may only be removed for cause and by the affirmative vote of at least a majority of the votes eligible to be cast by stockholders;
|
|
(v)
|
The ability of the board of directors to amend and repeal the bylaws;
|
|
(vi) |
The ability of the board of directors to evaluate a variety of factors in evaluating offers to purchase or otherwise acquire Jacksonville Bancorp-Maryland;
|
|
(vii) |
The authority of the board of directors to provide for the issuance of preferred stock;
|
|
(viii) |
The validity and effectiveness of any action lawfully authorized by the affirmative vote of the holders of a majority of the total number of outstanding shares of common stock;
|
|
(ix) |
The number of stockholders constituting a quorum or required for stockholder consent;
|
|
(x) |
The indemnification of current and former directors and officers, as well as employees and other agents, by Jacksonville Bancorp-Maryland;
|
|
(xi) |
The limitation of liability of officers and directors to Jacksonville Bancorp-Maryland for money damages;
|
|
(xii) |
The inability of stockholders to cumulate their votes in the election of directors;
|
|
(xiii) | The advance notice requirements for stockholder proposals and nominations; and |
|
(xiv)
|
The provisions of the articles of incorporation relating to amendments and requiring approval of at least 80% of the outstanding voting stock to amend the provisions of the articles of incorporation provided in (i) through (xiii) of this list.
|
●
|
the acquisition would result in a monopoly or substantially lessen competition;
|
●
|
the financial condition of the acquiring person might jeopardize the financial stability of the institution;
|
●
|
the competence, experience or integrity of the acquiring person indicates that it would not be in the interest of the depositors or the public to permit the acquisition of control by such person; or
|
●
|
the acquisition would have an adverse effect on the Deposit Insurance Fund.
|
Report of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated Financial Statements
|
|
Balance Sheets
|
F-3
|
Statements of Income
|
F-5
|
Statements of Stockholders’ Equity
|
F-7
|
Statements of Cash Flows
|
F-9
|
Notes to Financial Statements
|
F-11
|
2009
|
2008
|
|||||||
Cash and due from banks
|
$ | 4,412,988 | $ | 6,292,590 | ||||
Federal funds sold
|
9,925,855 | 460,194 | ||||||
Interest-bearing demand deposits in banks
|
1,357,631 | 392,504 | ||||||
Cash and cash equivalents
|
15,696,474 | 7,145,288 | ||||||
Available-for-sale securities:
|
||||||||
Investment securities
|
37,196,298 | 49,638,933 | ||||||
Mortgage-backed securities
|
40,984,395 | 27,795,119 | ||||||
Other investments
|
149,902 | 240,321 | ||||||
Loans held for sale
|
814,074 | 1,388,284 | ||||||
Loans, net of allowance for loan losses of $2,290,001 and $1,934,072 at December 31, 2009 and 2008
|
173,683,310 | 182,948,292 | ||||||
Premises and equipment
|
5,766,858 | 6,106,746 | ||||||
Federal Home Loan Bank stock
|
1,108,606 | 1,108,606 | ||||||
Foreclosed assets held for sale, net
|
382,879 | 769,467 | ||||||
Cash surrender value of life insurance
|
4,094,663 | 3,907,339 | ||||||
Interest receivable
|
1,988,394 | 2,344,502 | ||||||
Deferred income taxes
|
724,139 | 891,731 | ||||||
Mortgage servicing rights, net of valuation allowance of $156,442 and $428,030 as of December 31, 2009 and 2008
|
850,313 | 545,494 | ||||||
Goodwill
|
2,726,567 | 2,726,567 | ||||||
Other assets
|
2,679,600 | 718,645 | ||||||
Total assets
|
$ | 288,846,472 | $ | 288,275,334 |
2009
|
2008
|
|||||||
Liabilities
|
||||||||
Deposits
|
||||||||
Demand
|
$ | 20,668,169 | $ | 19,526,137 | ||||
Savings, NOW and money market
|
88,412,078 | 78,129,554 | ||||||
Time
|
145,619,976 | 140,495,537 | ||||||
Total deposits
|
254,700,223 | 238,151,228 | ||||||
Short-term borrowings
|
3,789,453 | 7,633,079 | ||||||
Federal Home Loan Bank advances
|
— | 13,500,000 | ||||||
Deferred compensation
|
2,826,227 | 2,576,290 | ||||||
Advances from borrowers for taxes and insurance
|
508,356 | 445,077 | ||||||
Interest payable
|
734,903 | 925,661 | ||||||
Other liabilities
|
1,023,890 | 784,559 | ||||||
Total liabilities
|
263,583,052 | 264,015,894 | ||||||
Commitments and contingencies | — | — | ||||||
Stockholders’ Equity
|
||||||||
Preferred stock, $.01 par value, authorized 10,000,000 shares;
none issued and outstanding |
— | — | ||||||
Common stock, $.01 par value; authorized 20,000,000 shares; issued 1,987,904 shares
|
19,879 | 19,879 | ||||||
Additional paid-in capital
|
6,634,591 | 6,634,108 | ||||||
Retained earnings – substantially restricted
|
18,399,506 | 17,268,043 | ||||||
Accumulated other comprehensive income
|
695,825 | 337,410 | ||||||
Treasury stock, at cost
Common; 2009 – 67,087 shares
|
(486,381 | ) | — | |||||
Total stockholders’ equity
|
25,263,420 | 24,259,440 | ||||||
Total liabilities and stockholders’ equity
|
$ | 288,846,472 | $ | 288,275,334 |
2009
|
2008
|
|||||||
Interest and Fee Income
|
||||||||
Loans, including fees
|
$ | 11,591,716 | $ | 12,026,500 | ||||
Debt securities
|
||||||||
Taxable
|
503,211 | 1,094,248 | ||||||
Tax-exempt
|
1,050,667 | 977,332 | ||||||
Mortgage-backed securities
|
1,262,357 | 1,579,923 | ||||||
Other
|
11,966 | 230,333 | ||||||
Total interest income
|
14,419,917 | 15,908,336 | ||||||
Interest Expense
|
||||||||
Deposits
|
5,315,273 | 7,168,601 | ||||||
Short-term borrowings
|
12,452 | 78,045 | ||||||
Federal Home Loan Bank advances
|
103,803 | 469,771 | ||||||
Total interest expense
|
5,431,528 | 7,716,417 | ||||||
Net Interest Income
|
8,988,389 | 8,191,919 | ||||||
Provision for Loan Losses
|
2,575,000 | 310,000 | ||||||
Net Interest Income After Provision for Loan Losses
|
6,413,389 | 7,881,919 | ||||||
Noninterest Income
|
||||||||
Fiduciary activities
|
166,138 | 220,542 | ||||||
Commission income
|
869,368 | 1,021,228 | ||||||
Service charges on deposit accounts
|
895,264 | 792,940 | ||||||
Mortgage banking operations, net
|
736,681 | 195,743 | ||||||
Net realized gains on sales of available-for-sale securities
|
588,959 | 33,324 | ||||||
Loan servicing fees
|
359,813 | 352,477 | ||||||
Increase in cash surrender value of life insurance
|
178,676 | 162,827 | ||||||
Other
|
414,195 | 381,842 | ||||||
Total noninterest income
|
4,209,094 | 3,160,923 |
2009
|
2008
|
|||||||
Noninterest Expense
|
||||||||
Salaries and employee benefits
|
$ | 5,579,322 | $ | 5,525,628 | ||||
Occupancy and equipment
|
1,075,728 | 1,101,671 | ||||||
Data processing
|
356,666 | 427,838 | ||||||
Professional
|
230,699 | 179,517 | ||||||
Marketing
|
112,273 | 124,321 | ||||||
Postage and office supplies
|
287,671 | 310,119 | ||||||
Deposit insurance premium
|
555,223 | 46,943 | ||||||
Impairment (recovery) on mortgage servicing rights asset
|
(122,790 | ) | 428,030 | |||||
Other
|
1,050,935 | 1,076,670 | ||||||
Total noninterest expense
|
9,125,727 | 9,220,737 | ||||||
Income Before Income Taxes
|
1,496,756 | 1,822,105 | ||||||
Provision for Income Taxes
|
100,589 | 304,183 | ||||||
Net Income
|
$ | 1,396,167 | $ | 1,517,922 | ||||
Basic Earnings Per Share
|
$ | 0.72 | $ | 0.76 | ||||
Diluted Earnings Per Share
|
$ | 0.72 | $ | 0.76 | ||||
Cash Dividends Per Share
|
$ | 0.30 | $ | 0.30 |
Additional
|
||||||||||||
Issued Common Stock
|
Paid-in
|
|||||||||||
Shares
|
Amount
|
Capital
|
||||||||||
Balance, January 1, 2008
|
1,986,804 | $ | 19,868 | $ | 6,621,359 | |||||||
Comprehensive income
|
||||||||||||
Net income
|
— | — | — | |||||||||
Change in unrealized appreciation on available-for-sale securities, net of taxes
|
— | — | — | |||||||||
Total comprehensive income
|
||||||||||||
Stock option compensation expense
|
— | — | 1,760 | |||||||||
Dividends on common stock, $.30 per share
|
— | — | — | |||||||||
Stock options exercised
|
1,100 | 11 | 10,989 | |||||||||
Balance, December 31, 2008
|
1,987,904 | 19,879 | 6,634,108 | |||||||||
Comprehensive income
|
||||||||||||
Net income
|
— | — | — | |||||||||
Change in unrealized appreciation on available-for-sale securities, net of taxes
|
— | — | — | |||||||||
Total comprehensive income
|
||||||||||||
Purchase of treasury stock (67,087 shares)
|
— | — | — | |||||||||
Stock option compensation expense
|
— | — | 483 | |||||||||
Dividends on common stock, $.30 per share
|
— | — | — | |||||||||
Balance, December 31, 2009
|
1,987,904 | $ | 19,879 | $ | 6,634,591 |
Accumulated
|
||||||||||||||||
Other
|
||||||||||||||||
Retained
|
Comprehensive
|
Treasury
|
||||||||||||||
Earnings
|
Income (Loss)
|
Stock
|
Total
|
|||||||||||||
Balance, January 1, 2008
|
$ | 16,034,800 | $ | (58,136 | ) | $ | — | $ | 22,617,891 | |||||||
Comprehensive income
|
||||||||||||||||
Net income
|
1,517,922 | — | — | 1,517,922 | ||||||||||||
Change in unrealized appreciation on available-for-sale securities, net of taxes
|
— | 395,546 | — | 395,546 | ||||||||||||
Total comprehensive income
|
1,913,468 | |||||||||||||||
Stock option compensation expense
|
— | — | — | 1,760 | ||||||||||||
Dividends on common stock, $.30 per share
|
(284,679 | ) | — | — | (284,679 | ) | ||||||||||
Stock options exercised
|
— | — | — | 11,000 | ||||||||||||
Balance, December 31, 2008
|
17,268,043 | 337,410 | — | 24,259,440 | ||||||||||||
Comprehensive income
|
||||||||||||||||
Net income
|
1,396,167 | — | — | 1,396,167 | ||||||||||||
Change in unrealized appreciation on available-for-sale securities, net of taxes
|
— | 358,415 | — | 358,415 | ||||||||||||
Total comprehensive income
|
1,754,582 | |||||||||||||||
Purchase of treasury stock (67,087 shares)
|
— | — | (486,381 | ) | (486,381 | ) | ||||||||||
Stock option compensation expense
|
— | — | — | 483 | ||||||||||||
Dividends on common stock, $.30 per share
|
(264,704 | ) | — | — | (264,704 | ) | ||||||||||
Balance, December 31, 2009
|
$ | 18,399,506 | $ | 695,825 | $ | (486,381 | ) | $ | 25,263,420 |
2009
|
2008
|
|||||||
Operating Activities
|
||||||||
Net income
|
$ | 1,396,167 | $ | 1,517,922 | ||||
Items not requiring (providing) cash
|
||||||||
Depreciation and amortization
|
406,469 | 431,697 | ||||||
Provision for loan losses
|
2,575,000 | 310,000 | ||||||
Amortization of premiums and discounts on securities
|
955,364 | 83,720 | ||||||
Amortization of core deposit intangibles
|
— | 39,862 | ||||||
Deferred income taxes
|
(17,047 | ) | (290,430 | ) | ||||
Net realized gains on available-for-sale securities
|
(588,959 | ) | (33,324 | ) | ||||
Amortization of mortgage servicing rights
|
507,313 | 196,403 | ||||||
Impairment (recovery) of mortgage servicing rights asset
|
(122,790 | ) | 428,030 | |||||
Increase in cash surrender value of life insurance
|
(187,324 | ) | (171,476 | ) | ||||
Gains on sales of foreclosed assets
|
(11,701 | ) | (18,242 | ) | ||||
Gain on sale of premises and equipment
|
— | (6,517 | ) | |||||
Stock option compensation expense
|
483 | 1,760 | ||||||
Tax benefit relating to stock options exercised
|
— | — | ||||||
Changes in
|
||||||||
Interest receivable
|
356,108 | (239,408 | ) | |||||
Other assets
|
(1,990,045 | ) | (354,574 | ) | ||||
Interest payable
|
(190,758 | ) | (322,685 | ) | ||||
Other liabilities
|
523,316 | (212,431 | ) | |||||
Origination of loans held for sale
|
(66,814,834 | ) | (29,807,986 | ) | ||||
Proceeds from sales of loans held for sale
|
66,699,701 | 30,076,869 | ||||||
Net cash provided by operating activities
|
3,496,463 | 1,629,190 | ||||||
Investing Activities
|
||||||||
Purchases of available-for-sale securities
|
(101,825,114 | ) | (69,456,634 | ) | ||||
Proceeds from maturities of available-for-sale securities
|
43,966,667 | 50,922,663 | ||||||
Proceeds from the sales of available-for-sale investments and other investments
|
57,378,873 | 22,009,669 | ||||||
Net change in loans
|
6,600,703 | (7,901,707 | ) | |||||
Purchase of premises and equipment
|
(66,581 | ) | (295,828 | ) | ||||
Proceeds from sales of premises and equipment
|
— | 32,795 | ||||||
Proceeds from the sale of foreclosed assets
|
487,568 | 201,880 | ||||||
Purchase of bank-owned life insurance
|
— | (549,635 | ) | |||||
Net cash provided by (used in) investing activities
|
6,542,116 | (5,036,797 | ) |
2009
|
2008
|
|||||||
Financing Activities
|
||||||||
Net increase in demand deposits, money market, NOW and savings accounts
|
$ | 11,424,556 | $ | 2,267,974 | ||||
Net increase (decrease) in certificates of deposit
|
5,124,439 | (9,837,497 | ) | |||||
Net increase (decrease) in short-term borrowings
|
(3,843,626 | ) | 2,697,045 | |||||
Proceeds from Federal Home Loan Bank advances
|
— | 8,500,000 | ||||||
Repayment of Federal Home Loan Bank advances
|
(13,500,000 | ) | (5,000,000 | ) | ||||
Net increase in advances from borrowers for taxes and insurance
|
63,279 | 23,588 | ||||||
Proceeds from stock options exercised
|
— | 11,000 | ||||||
Purchase and retirement of common stock
|
— | — | ||||||
Purchase of treasury stock
|
(486,381 | ) | — | |||||
Dividends paid
|
(269,660 | ) | (284,679 | ) | ||||
Net cash provided by (used in) financing activities
|
(1,487,393 | ) | (1,622,569 | ) | ||||
Increase (Decrease) in Cash and Cash Equivalents
|
8,551,186 | (5,030,176 | ) | |||||
Cash and Cash Equivalents, Beginning of Year
|
7,145,288 | 12,175,464 | ||||||
Cash and Cash Equivalents, End of Year
|
$ | 15,696,474 | $ | 7,145,288 | ||||
Supplemental Cash Flows Information
|
||||||||
Interest paid
|
$ | 5,622,286 | $ | 8,039,102 | ||||
Income taxes paid
|
$ | 559,000 | $ | 551,600 | ||||
Sale and financing of foreclosed assets
|
$ | 218,636 | $ | 156,890 | ||||
Real estate acquired in settlement of loans
|
$ | 307,915 | $ | 666,822 | ||||
Dividends declared not paid
|
$ | 66,157 | $ | 71,113 | ||||
Loans held for sale transferred to loans
|
$ | — | $ | — |
Note 1:
|
Nature of Operations and Summary of Significant Accounting Policies
|
|
Principles of Consolidation and Financial Statement Presentation
|
Buildings and improvements
|
35-40 years
|
Equipment
|
3-5 years
|
Note 2:
|
Restriction on Cash and Due From Banks
|
Note 3:
|
Securities
|
Amortized
Cost |
Gross
Unrealized Gains |
Gross
Unrealized Losses |
Fair Value
|
|||||||||||||
Available-for-sale
Securities
|
||||||||||||||||
December 31, 2009:
|
||||||||||||||||
U.S. Government and agencies
|
$ | 9,036,752 | $ | 70,820 | $ | (27,556 | ) | $ | 9,080,016 | |||||||
Mortgage-backed securities (Government-sponsored enterprises - residential)
|
40,428,279 | 610,634 | (54,518 | ) | 40,984,395 | |||||||||||
Municipal bonds
|
27,661,381 | 531,363 | (76,462 | ) | 28,116,282 | |||||||||||
$ | 77,126,412 | $ | 1,212,817 | $ | (158,536 | ) | $ | 78,180,693 | ||||||||
December 31, 2008:
|
||||||||||||||||
U.S. Government and agencies
|
$ | 19,472,065 | $ | 361,545 | $ | — | $ | 19,833,610 | ||||||||
Mortgage-backed securities (Government-sponsored enterprises - residential)
|
27,384,188 | 410,931 | — | 27,795,119 | ||||||||||||
Municipal bonds
|
30,066,572 | 283,150 | (544,399 | ) | 29,805,323 | |||||||||||
$ | 76,922,825 | $ | 1,055,626 | $ | (544,399 | ) | $ | 77,434,052 |
Available-for-sale
|
||||||||
Amortized
Cost
|
Fair
Value
|
|||||||
Within one year
|
$ | 270,508 | $ | 271,451 | ||||
One to five years
|
3,627,155 | 3,758,162 | ||||||
Five to ten years
|
18,617,963 | 18,862,007 | ||||||
After ten years
|
14,182,507 | 14,304,678 | ||||||
36,698,133 | 37,196,298 | |||||||
Mortgage-backed securities
|
40,428,279 | 40,984,395 | ||||||
Totals
|
$ | 77,126,412 | $ | 78,180,693 |
December 31, 2009
|
||||||||||||||||||||||||
Less than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
Description of
Securities
|
Fair Value
|
Unrealized
Losses
|
Fair Value
|
Unrealized
Losses
|
Fair Value
|
Unrealized
Losses
|
||||||||||||||||||
Available-for-sale Securities
|
||||||||||||||||||||||||
U.S. Government and agencies
|
$ | 2,477,539 | $ | (27,556 | ) | $ | — | $ | — | $ | 2,477,539 | $ | (27,556 | ) | ||||||||||
Mortgage-backed securities (Government-sponsored enterprises - residential)
|
7,435,781 | (54,518 | ) | — | — | 7,435,781 | (54,518 | ) | ||||||||||||||||
Municipal bonds
|
7,525,639 | (76,462 | ) | — | — | 7,525,639 | (76,462 | ) | ||||||||||||||||
Total temporarily impaired securities
|
$ | 17,438,959 | $ | (158,536 | ) | $ |
—
|
$ |
—
|
$ | 17,438,959 | $ | (158,536 | ) |
December 31, 2008
|
||||||||||||||||||||||||
Less than 12 Months
|
12 Months or More
|
Total
|
||||||||||||||||||||||
Description of
Securities
|
Fair Value
|
Unrealized
Losses
|
Fair Value
|
Unrealized
Losses
|
Fair Value
|
Unrealized
Losses
|
||||||||||||||||||
Available-for-sale Securities
|
||||||||||||||||||||||||
U.S. Government and agencies
|
$ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||
Mortgage-backed securities (Government-sponsored enterprises - residential)
|
— | — | — | — | — | — | ||||||||||||||||||
Municipal bonds
|
13,971,751 | (544,399 | ) | — | — | 13,971,751 | (544,399 | ) | ||||||||||||||||
Total temporarily impaired securities
|
$ | 13,971,751 | $ | (544,399 | ) | $ |
—
|
$ |
—
|
$ | 13,971,751 | $ | (544,399 | ) |
Note 4:
|
Loans and Allowance for Loan Losses
|
2009
|
2008
|
|||||||
Mortgage loans on real estate
|
||||||||
Residential 1-4 family
|
$ | 38,580,967 | $ | 46,806,391 | ||||
Commercial and agricultural
|
60,993,795 | 61,034,537 | ||||||
Second mortgages
|
28,119,373 | 30,001,775 | ||||||
Total mortgage loans on real estate
|
127,694,135 | 137,842,703 | ||||||
Commercial loans, including agricultural
|
34,393,456 | 35,356,098 | ||||||
Consumer
|
6,117,802 | 5,841,659 | ||||||
Other
|
7,836,674 | 5,950,391 | ||||||
176,042,067 | 184,990,851 | |||||||
Less
|
||||||||
Net deferred loan fees
|
68,756 | 108,487 | ||||||
Allowance for loan losses
|
2,290,001 | 1,934,072 | ||||||
Net loans
|
$ | 173,683,310 | $ | 182,948,292 |
2009
|
2008
|
|||||||
Balance, beginning of year
|
$ | 1,934,072 | $ | 1,766,229 | ||||
Provision charged to expense
|
2,575,000 | 310,000 | ||||||
Losses charged off, net of recoveries of $24,042 for 2009 and $64,025 for 2008
|
(2,219,071 | ) | (142,157 | ) | ||||
Balance, end of year
|
$ | 2,290,001 | $ | 1,934,072 |
2009
|
2008
|
|||||||
Impaired loans without a valuation allowance
|
$ | — | $ | 206,446 | ||||
Impaired loans with a valuation allowance
|
3,713,484 | 1,147,702 | ||||||
Total impaired loans
|
$ | 3,713,484 | $ | 1,354,148 | ||||
Valuation allowance related to impaired loans
|
$ | 559,481 | $ | 174,905 | ||||
Total nonaccrual loans
|
$ | 1,597,027 | $ | 1,004,881 | ||||
Total loans past due 90 days or more and still accruing
|
$ | 356,534 | $ | 185,502 |
2009
|
2008
|
|||||||
Average investment in impaired loans
|
$ | 5,205,308 | $ | 489,211 | ||||
Interest income recognized on impaired loans
|
$ | 226,821 | $ | 114,520 | ||||
Interest income recognized on a cash basis on impaired loans
|
$ | 219,969 | $ | 96,459 |
Note 5:
|
Premises and Equipment
|
2009
|
2008
|
|||||||
Land
|
$ | 983,276 | $ | 983,276 | ||||
Buildings and improvements
|
7,542,073 | 7,522,011 | ||||||
Equipment
|
4,440,594 | 4,401,113 | ||||||
12,965,943 | 12,906,400 | |||||||
Less accumulated depreciation
|
(7,199,085 | ) | (6,799,654 | ) | ||||
Net premises and equipment
|
$ | 5,766,858 | $ | 6,106,746 |
Note 6:
|
Loan Servicing
|
2009
|
2008
|
|||||||
Mortgage servicing rights
|
||||||||
Balance, beginning of year
|
$ | 973,524 | $ | 965,679 | ||||
Additions
|
391,746 | 204,248 | ||||||
Amortization
|
(358,515 | ) | (196,403 | ) | ||||
Balance at end of year
|
1,006,755 | 973,524 | ||||||
Valuation allowances
|
||||||||
Balance at beginning of year
|
428,030 | — | ||||||
Additions
|
— | 428,030 | ||||||
Reduction due to increases in market value
|
(122,790 | ) | — | |||||
Reduction due to payoff of loans
|
(148,798 | ) | — | |||||
Balances at end of year
|
156,442 | 428,030 | ||||||
Mortgage servicing assets, net
|
$ | 850,313 | $ | 545,494 | ||||
Fair value disclosures
|
||||||||
Fair value as of the beginning of the period
|
$ | 545,494 | $ | 1,040,899 | ||||
Fair value as of the end of the period
|
$ | 1,083,576 | $ | 545,494 |
Note 7:
|
Deposits
|
December 31,
|
||||||||
2009
|
2008
|
|||||||
Savings, NOW and Money Market
|
$ | 729,009 | $ | 1,056,335 | ||||
Certificates of deposit
|
4,586,264 | 6,112,266 | ||||||
Total deposit interest expense
|
$ | 5,315,273 | $ | 7,168,601 |
2010
|
$ | 108,098,457 | ||
2011
|
25,659,323 | |||
2012
|
4,990,759 | |||
2013
|
2,171,590 | |||
2014
|
4,684,766 | |||
Thereafter
|
15,081 | |||
$ | 145,619,976 |
Note 8:
|
Short-term Borrowings
|
Note 9:
|
Federal Home Loan Bank Advances
|
Note 10:
|
Income Taxes
|
2009
|
2008
|
|||||||
Taxes currently payable
|
||||||||
Federal
|
$ | 117,636 | $ | 594,613 | ||||
State
|
— | — | ||||||
Deferred income taxes
|
(17,047 | ) | (290,430 | ) | ||||
Income tax expense
|
$ | 100,589 | $ | 304,183 |
2009
|
2008
|
|||||||
Computed at the statutory rate (34%)
|
$ | 508,897 | $ | 619,515 | ||||
Increase (decrease) resulting from
|
||||||||
Tax exempt interest
|
(354,497 | ) | (283,936 | ) | ||||
Graduated tax rates
|
(14,968 | ) | (18,221 | ) | ||||
State income taxes, net
|
58,345 | 58,144 | ||||||
Increase in cash surrender value
|
(60,750 | ) | (55,361 | ) | ||||
Other
|
(36,438 | ) | (15,958 | ) | ||||
Actual tax expense
|
$ | 100,589 | $ | 304,183 | ||||
Tax expense as a percentage of pre-tax income
|
6.72 | % | 16.69 | % |
2009
|
2008
|
|||||||
Deferred tax assets
|
||||||||
Allowance for loan losses
|
$ | 763,554 | $ | 625,389 | ||||
Deferred compensation
|
1,097,085 | 1,000,064 | ||||||
State net operating loss carryforward
|
160,488 | 220,325 | ||||||
2,021,127 | 1,845,778 | |||||||
Deferred tax liabilities
|
||||||||
Unrealized gains on available-for-sale securities
|
(358,456 | ) | (173,817 | ) | ||||
Depreciation
|
(360,916 | ) | (337,862 | ) | ||||
Federal Home Loan Bank stock dividends
|
(146,736 | ) | (146,736 | ) | ||||
Prepaid expenses
|
(68,875 | ) | (46,695 | ) | ||||
Mortgage servicing rights
|
(330,075 | ) | (211,750 | ) | ||||
Other
|
(31,930 | ) | (37,187 | ) | ||||
(1,296,988 | ) | (954,047 | ) | |||||
Net deferred tax asset
|
$ | 724,139 | $ | 891,731 |
Note 11:
|
Comprehensive Income
|
2009
|
2008
|
|||||||
Net unrealized gain (loss) on available-for-sale securities
|
$ | 1,132,013 | $ | 632,636 | ||||
Less reclassification adjustment for realized gains included in income
|
588,959 | 33,324 | ||||||
Other comprehensive income, before tax effect
|
543,054 | 599,312 | ||||||
Less tax expense
|
184,639 | 203,766 | ||||||
Other comprehensive income
|
$ | 358,415 | $ | 395,546 |
2009
|
2008
|
|||||||
Net unrealized gain (loss) on securities available-for-sale
|
$ | 1,054,281 | $ | 511,227 | ||||
Tax effect
|
(358,456 | ) | (173,817 | ) | ||||
Net-of-tax amount
|
$ | 695,825 | $ | 337,410 |
Note 12:
|
Regulatory Matters
|
Actual
|
Minimum Capital
Requirement |
Minimum to Be Well
Capitalized Under Prompt Corrective Action Provisions |
||||||||||||||||||||||
Amount
|
Ratio
|
Amount
|
Ratio
|
Amount
|
Ratio
|
|||||||||||||||||||
As of December 31, 2009
|
||||||||||||||||||||||||
Total risk-based capital
(to risk-weighted assets)
|
$ | 23,891 | 11.83 | % | $ | 16,146 | 8.0 | % | $ | 20,183 | 10.0 | % | ||||||||||||
Tier I capital
(to risk-weighted assets)
|
21,601 | 10.70 | 8,073 | 4.0 | 12,110 | 6.0 | ||||||||||||||||||
Tier I capital
(to average assets)
|
21,601 | 7.44 | 11,611 | 4.0 | 14,514 | 5.0 | ||||||||||||||||||
Tangible capital
(to adjusted tangible assets)
|
21,601 | 7.44 | 4,354 | 1.5 | — | N/A | ||||||||||||||||||
As of December 31, 2008
|
||||||||||||||||||||||||
Total risk-based capital
(to risk-weighted assets)
|
$ | 22,816 | 10.94 | % | $ | 16,677 | 8.0 | % | $ | 20,846 | 10.0 | % | ||||||||||||
Tier I capital
(to risk-weighted assets)
|
20,882 | 10.02 | 8,338 | 4.0 | 12,508 | 6.0 | ||||||||||||||||||
Tier I capital
(to average assets)
|
20,882 | 7.30 | 11,436 | 4.0 | 14,295 | 5.0 | ||||||||||||||||||
Tangible capital
(to adjusted tangible assets)
|
20,882 | 7.30 | 4,289 | 1.5 | — | N/A |
2009
|
2008
|
|||||||
Bank equity
|
$ | 25,024 | $ | 24,001 | ||||
Less net unrealized gain
|
696 | 337 | ||||||
Less disallowed goodwill
|
2,727 | 2,727 | ||||||
Less disallowed servicing amounts
|
— | 55 | ||||||
Tier 1 capital
|
21,601 | 20,882 | ||||||
Plus allowance for loan losses
|
2,290 | 1,934 | ||||||
Total risked-based capital
|
$ | 23,891 | $ | 22,816 |
Year ended December 31, 2000
|
$ | 77,905 | ||
Year ended December 31, 2001
|
311,621 | |||
Year ended December 31, 2002
|
311,622 | |||
Year ended December 31, 2003
|
311,621 | |||
Year ended December 31, 2004
|
311,622 | |||
Year ended December 31, 2005
|
311,621 | |||
Year ended December 31, 2006
|
311,622 | |||
Year ended December 31, 2007
|
311,621 | |||
Year ended December 31, 2008
|
311,622 | |||
Year ended December 31, 2009
|
311,621 | |||
$ | 2,882,498 |
Note 13:
|
Related Party Transactions
|
2009
|
2008
|
|||||||
Balance beginning of year
|
$ | 979,776 | $ | 944,569 | ||||
Additions
|
2,657,615 | 2,402,371 | ||||||
Repayments
|
(1,855,537 | ) | (2,311,845 | ) | ||||
Change in related parties
|
2,394,038 | (55,319 | ) | |||||
Balance, end of year
|
$ | 4,175,892 | $ | 979,776 |
Note 14:
|
Employee Benefits
|
Note 15:
|
Stock Options Plan
|
2009
|
||||||||||||||||
Shares
|
Weighted-
Average Exercise Price |
Weighted-
Average Remaining Contractual Term |
Aggregate
Intrinsic Value |
|||||||||||||
Outstanding, beginning of year
|
34,445 | $ | 10.65 | |||||||||||||
Granted
|
— | — | ||||||||||||||
Exercised
|
— | — | ||||||||||||||
Forfeited or expired
|
(1,100 | ) | 14.00 | |||||||||||||
Outstanding, end of year
|
33,345 | $ | 10.54 | 2.40 | $ | 0 | ||||||||||
Exercisable, end of year
|
33,345 | $ | 10.54 | 2.40 | $ | 0 |
2008
|
||||||||||||||||
Shares
|
Weighted-
Average Exercise Price |
Weighted-
Average Remaining Contractual Term |
Aggregate
Intrinsic Value |
|||||||||||||
Outstanding, beginning of year
|
35,545 | $ | 10.63 | |||||||||||||
Granted
|
— | — | ||||||||||||||
Exercised
|
(1,100 | ) | 10.00 | |||||||||||||
Forfeited or expired
|
— | — | ||||||||||||||
Outstanding, end of year
|
34,445 | $ | 10.65 | 3.49 | $ | 0 | ||||||||||
Exercisable, end of year
|
34,205 | $ | 10.63 | 3.46 | $ | 0 |
Note 16:
|
Earnings Per Share
|
Year Ended December 31, 2009
|
||||||||||||
Income
|
Weighted-
Average Shares |
Per Share
Amount |
||||||||||
Net income
|
$ | 1,396,167 | ||||||||||
Basic earnings per share
|
||||||||||||
Income available to common stockholders
|
1,927,250 | $ | 0.72 | |||||||||
Effect of dilutive securities
|
||||||||||||
Stock options
|
— | — | ||||||||||
Diluted earnings per share
|
||||||||||||
Income available to common stockholders
|
$ | 1,396,167 | 1,927,250 | $ | 0.72 |
Year Ended December 31, 2008
|
||||||||||||
Income
|
Weighted-
Average Shares |
Per Share
Amount |
||||||||||
Net income
|
$ | 1,517,922 | ||||||||||
Basic earnings per share
|
1,987,712 | |||||||||||
Income available to common stockholders
|
$ | .76 | ||||||||||
Effect of dilutive securities
|
||||||||||||
Stock options
|
— | — | ||||||||||
Diluted earnings per share
|
||||||||||||
Income available to common stockholders
|
$ | 1,517,922 | 1,987,712 | $ | .76 |
Note 17:
|
Disclosures about Fair Value of Assets and Liabilities
|
|
Level 1
|
Quoted prices in active markets for identical assets or liabilities
|
|
Level 2
|
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
|
|
Level 3
|
Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities
|
2009
|
||||||||||||||||
Fair Value Measurements Using
|
||||||||||||||||
Fair Value
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs (Level 3) |
|||||||||||||
U.S. Government and agencies
|
$ | 9,080,016 | $ | — | $ | 9,080,016 | $ | — | ||||||||
Mortgage-backed securities (Government-sponsored enterprises - residential)
|
40,984,395 | — | 40,984,395 | — | ||||||||||||
Municipal bonds
|
28,116,282 | — | 28,116,282 | — |
2008
|
||||||||||||||||
Fair Value Measurements Using
|
||||||||||||||||
Fair Value
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs (Level 3) |
|||||||||||||
U.S. Government and agencies
|
$ | 19,833,610 | $ | — | $ | 19,833,610 | $ | — | ||||||||
Mortgage-backed securities (Government-sponsored enterprises -residential)
|
27,795,119 | — | 27,795,119 | — | ||||||||||||
Municipal bonds
|
29,805,323 | — | 29,805,323 | — |
2009
|
||||||||||||||||
Fair Value Measurements Using
|
||||||||||||||||
Fair Value
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs (Level 3) |
|||||||||||||
Impaired loans (collateral dependent)
|
$ | 3,154,003 | $ | — | $ | — | $ | 3,154,003 | ||||||||
Mortgage servicing rights
|
850,313 | — | — | 850,313 |
2008
|
||||||||||||||||
Fair Value Measurements Using
|
||||||||||||||||
Fair Value
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs (Level 3) |
|||||||||||||
Impaired loans (collateral dependent)
|
$ | 972,797 | $ | — | $ | — | $ | 972,797 | ||||||||
Mortgage servicing rights
|
545,494 | — | — | 545,494 |
December 31, 2009
|
December 31, 2008
|
|||||||||||||||
Carrying
Amount |
Fair Value
|
Carrying
Amount |
Fair Value
|
|||||||||||||
Financial assets
|
||||||||||||||||
Cash and cash equivalents
|
$ | 15,696,474 | $ | 15,696,474 | $ | 7,145,288 | $ | 7,145,288 | ||||||||
Available-for-sale securities
|
78,180,693 | 78,180,693 | 77,434,052 | 77,434,052 | ||||||||||||
Other investments
|
149,902 | 149,902 | 240,321 | 240,321 | ||||||||||||
Loans held for sale
|
814,074 | 814,074 | 1,388,284 | 1,388,284 | ||||||||||||
Loans, net of allowance for loan losses
|
173,683,310 | 171,479,887 | 182,948,292 | 181,308,061 | ||||||||||||
Federal Home Loan Bank stock
|
1,108,606 | 1,108,606 | 1,108,606 | 1,108,606 | ||||||||||||
Interest receivable
|
1,988,394 | 1,988,394 | 2,344,502 | 2,344,502 | ||||||||||||
Financial liabilities
|
||||||||||||||||
Deposits
|
254,700,223 | 257,948,804 | 238,151,228 | 240,721,801 | ||||||||||||
Short-term borrowings
|
3,789,453 | 3,789,453 | 7,633,079 | 7,633,079 | ||||||||||||
Federal Home Loan Bank advances
|
— | — | 13,500,000 | 13,593,469 | ||||||||||||
Advances from borrowers for taxes and insurance
|
508,356 | 508,356 | 445,077 | 445,077 | ||||||||||||
Interest payable
|
734,903 | 734,903 | 925,661 | 925,661 | ||||||||||||
Unrecognized financial instruments (net of contract amount)
|
||||||||||||||||
Commitments to originate loans
|
— | — | — | — | ||||||||||||
Letters of credit
|
— | — | — | — | ||||||||||||
Lines of credit
|
— | — | — | — |
Note 18:
|
Significant Estimates and Concentrations
|
Note 19:
|
Commitments and Credit Risk
|
Note 20:
|
Plan of Conversion
|
Note 21:
|
Quarterly Results of Operations (Unaudited)
|
Year Ended December 31, 2009
|
||||||||||||||||
Three Months Ended
|
||||||||||||||||
December 31
|
September 30
|
June 30
|
March 31
|
|||||||||||||
Interest income
|
$ | 3,387,087 | $ | 3,649,444 | $ | 3,609,769 | $ | 3,773,617 | ||||||||
Interest expense
|
1,204,502 | 1,314,222 | 1,421,744 | 1,491,060 | ||||||||||||
Net interest income
|
2,182,585 | 2,335,222 | 2,188,025 | 2,282,557 | ||||||||||||
Provision for loan losses
|
425,000 | 250,000 | 1,550,000 | 350,000 | ||||||||||||
Net interest income after provision for loan losses
|
1,757,585 | 2,085,222 | 638,025 | 1,932,557 | ||||||||||||
Other income
|
1,184,528 | 871,823 | 1,247,162 | 905,581 | ||||||||||||
Other expense
|
2,419,836 | 2,270,706 | 2,219,603 | 2,215,582 | ||||||||||||
Income before income taxes
|
522,277 | 686,339 | (334,416 | ) | 622,556 | |||||||||||
Income tax expense (benefit)
|
91,752 | 149,123 | (261,592 | ) | 121,306 | |||||||||||
Net income (loss)
|
$ | 430,525 | $ | 537,216 | $ | (72,824 | ) | $ | 501,250 | |||||||
Basic earnings (loss) per share
|
$ | 0.22 | $ | 0.28 | $ | (0.04 | ) | $ | 0.26 | |||||||
Diluted earnings (loss) per share
|
$ | 0.22 | $ | 0.28 | $ | (0.04 | ) | $ | 0.26 |
Year Ended December 31, 2008
|
||||||||||||||||
Three Months Ended
|
||||||||||||||||
December 31
|
September 30
|
June 30
|
March 31
|
|||||||||||||
Interest income
|
$ | 3,946,895 | $ | 3,972,057 | $ | 3,933,463 | $ | 4,055,921 | ||||||||
Interest expense
|
1,615,858 | 1,856,923 | 2,023,898 | 2,219,738 | ||||||||||||
Net interest income
|
2,331,037 | 2,115,134 | 1,909,565 | 1,836,183 | ||||||||||||
Provision for loan losses
|
145,000 | 105,000 | 30,000 | 30,000 | ||||||||||||
Net interest income after provision for loan losses
|
2,186,037 | 2,010,134 | 1,879,565 | 1,806,183 | ||||||||||||
Other income
|
718,730 | 844,964 | 800,069 | 797,160 | ||||||||||||
Other expense
|
2,713,605 | 2,206,700 | 2,160,897 | 2,139,535 | ||||||||||||
Income before income taxes
|
191,162 | 648,398 | 518,737 | 463,808 | ||||||||||||
Income tax expense (benefit)
|
(40,813 | ) | 149,601 | 94,956 | 100,439 | |||||||||||
Net income
|
$ | 231,975 | $ | 498,797 | $ | 423,781 | $ | 363,369 | ||||||||
Basic earnings per share
|
$ | 0.12 | $ | 0.25 | $ | 0.21 | $ | 0.18 | ||||||||
Diluted earnings per share
|
$ | 0.12 | $ | 0.25 | $ | 0.21 | $ | 0.18 |
Note 22:
|
Condensed Financial Information (Parent Company Only)
|
December 31,
|
||||||||
2009
|
2008
|
|||||||
Assets
|
||||||||
Cash and due from banks
|
$ | 146,663 | $ | 203,417 | ||||
Investment in common stock of subsidiary
|
25,023,244 | 24,000,219 | ||||||
Other assets
|
190,588 | 149,388 | ||||||
Total assets
|
$ | 25,360,495 | $ | 24,353,024 | ||||
Liabilities
|
||||||||
Other liabilities
|
$ | 97,075 | $ | 93,584 | ||||
Total liabilities
|
97,075 | 93,584 | ||||||
Stockholders’ Equity
|
25,263,420 | 24,259,440 | ||||||
Total liabilities and stockholders’ equity
|
$ | 25,360,495 | $ | 24,353,024 |
Year Ending December 31,
|
||||||||
2009
|
2008
|
|||||||
Income
|
||||||||
Dividends from subsidiary
|
$ | 864,624 | $ | 384,749 | ||||
Other income
|
746 | 854 | ||||||
Total income
|
865,370 | 385,603 | ||||||
Expenses
|
||||||||
Other expenses
|
218,720 | 151,222 | ||||||
Total expenses
|
218,720 | 151,222 | ||||||
Income Before Income Tax and Equity in Undistributed Income of Subsidiary
|
646,650 | 234,381 | ||||||
Income Tax Benefit
|
(84,908 | ) | (58,702 | ) | ||||
Income Before Equity in Undistributed Income of Subsidiary
|
731,558 | 293,083 | ||||||
Equity in Undistributed Income of Subsidiary
|
664,609 | 1,224,839 | ||||||
Net Income
|
$ | 1,396,167 | $ | 1,517,922 |
Year Ending December 31,
|
||||||||
2009
|
2008
|
|||||||
Operating Activities
|
||||||||
Net income
|
$ | 1,396,167 | $ | 1,517,922 | ||||
Items not providing cash, net
|
(664,126 | ) | (1,223,081 | ) | ||||
Change in other assets and liabilities, net
|
(37,710 | ) | (7,439 | ) | ||||
Net cash provided by operating activities
|
694,331 | 287,402 | ||||||
Financing Activities
|
||||||||
Dividends paid
|
(264,704 | ) | (284,679 | ) | ||||
Purchase and retirement of common stock
|
— | — | ||||||
Purchase of treasury stock
|
(486,381 | ) | — | |||||
Exercise of stock options
|
— | 11,000 | ||||||
Net cash used in financing activities
|
(751,085 | ) | (273,679 | ) | ||||
Net Change in Cash and Cash Equivalents
|
(56,754 | ) | 13,723 | |||||
Cash and Cash Equivalents at Beginning of Year
|
203,417 | 189,694 | ||||||
Cash and Cash Equivalents at End of Year
|
$ | 146,663 | $ | 203,417 |
1.
|
The approval of a plan of conversion and reorganization (the “Plan”) whereby: (a) Jacksonville Bancorp, MHC and Jacksonville Bancorp, Inc., a Federal Corporation (“Jacksonville Bancorp-Federal”) will convert and reorganize from the mutual holding company structure to the stock holding company structure; (b) Jacksonville Bancorp, Inc., a Maryland corporation (“Jacksonville Bancorp-Maryland”), will become the new stock holding company of Jacksonville Savings Bank; (c) the outstanding shares of Jacksonville Bancorp-Federal other than those held by Jacksonville Bancorp, MHC, will be converted into shares of common stock of Jacksonville Bancorp-Maryland; and (d) Jacksonville Bancorp-Maryland will offer shares of its common stock for sale in a subscription offering, community offering and, possibly, a syndicated community offering;
|
||
2.
|
The approval of the adjournment of the special meeting, if necessary, to solicit additional proxies in the event that there are not sufficient votes at the time of the special meeting to approve the plan of conversion and reorganization;
|
||
3.
|
The following informational proposals:
|
||
3a.
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote to approve certain amendments to Jacksonville Bancorp-Maryland’s articles of incorporation;
|
||
3b.
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote of stockholders to approve stockholder-proposed amendments to Jacksonville Bancorp-Maryland’s bylaws;
|
||
3c.
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Jacksonville Bancorp-Maryland’s outstanding voting stock; and
|
||
4.
|
Such other business that may properly come before the meeting.
|
BY ORDER OF THE BOARD OF DIRECTORS
|
||
John D. Eilering
|
||
Corporate Secretary
|
QUESTIONS AND ANSWERS FOR STOCKHOLDERS OF JACKSONVILLE BANCORP-FEDERAL REGARDING THE PLAN OF CONVERSION AND REORGANIZATION
|
1
|
SUMMARY
|
6
|
RISK FACTORS
|
12
|
PROPOSAL 1 — APPROVAL OF THE PLAN OF CONVERSION AND REORGANIZATION
|
17
|
PROPOSAL 2 — ADJOURNMENT OF THE SPECIAL MEETING
|
20
|
PROPOSALS 3a THROUGH 3c — INFORMATIONAL PROPOSALS RELATED TO THE ARTICLES OF INCORPORATION AND BYLAWS OF JACKSONVILLE BANCORP-MARYLAND
|
21
|
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
|
25
|
FORWARD-LOOKING STATEMENTS
|
26
|
HOW WE INTEND TO USE THE PROCEEDS FROM THE OFFERING
|
27
|
OUR DIVIDEND POLICY
|
27
|
MARKET FOR THE COMMON STOCK
|
27
|
HISTORICAL AND PRO FORMA REGULATORY CAPITAL COMPLIANCE
|
28
|
CAPITALIZATION
|
29
|
PRO FORMA DATA
|
30
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
31
|
BUSINESS OF JACKSONVILLE BANCORP-MARYLAND
|
32
|
BUSINESS OF JACKSONVILLE BANCORP-FEDERAL AND JACKSONVILLE SAVINGS BANK
|
32
|
SUPERVISION AND REGULATION
|
33
|
TAXATION
|
33
|
MANAGEMENT
|
34
|
BENEFICIAL OWNERSHIP OF COMMON STOCK
|
35
|
SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS
|
35
|
COMPARISON OF STOCKHOLDERS’ RIGHTS FOR EXISTING STOCKHOLDERS OF JACKSONVILLE BANCORP-FEDERAL
|
36
|
RESTRICTIONS ON ACQUISITION OF JACKSONVILLE BANCORP-MARYLAND
|
37
|
DESCRIPTION OF CAPITAL STOCK OF JACKSONVILLE BANCORP-MARYLAND FOLLOWING THE CONVERSION
|
38
|
TRANSFER AGENT
|
38
|
EXPERTS
|
38
|
LEGAL MATTERS
|
38
|
WHERE YOU CAN FIND ADDITIONAL INFORMATION
|
38
|
OTHER MATTERS
|
38
|
JACKSONVILLE BANCORP-FEDERAL INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
|
F-1
|
Q.
|
WHAT ARE STOCKHOLDERS BEING ASKED TO APPROVE?
|
|
A.
|
Jacksonville Bancorp-Federal stockholders as of May 10, 2010 are being asked to vote to approve the plan of conversion pursuant to which Jacksonville Bancorp, MHC will convert from the mutual to the stock form of organization. As part of the conversion, a newly formed Maryland corporation, Jacksonville Bancorp-Maryland is offering its common stock to eligible depositors of Jacksonville Savings Bank, to Jacksonville Savings Bank’s tax qualified benefit plans, to stockholders of Jacksonville Bancorp-Federal as of May 10, 2010 and to the public. The shares offered represent Jacksonville Bancorp, MHC’s current 54.1% ownership interest in Jacksonville Bancorp-Federal. Voting for approval of the plan of conversion will also include approval of the exchange ratio and the articles of incorporation and bylaws of Jacksonville Bancorp-Maryland (including the anti-takeover provisions and provisions limiting stockholder rights).
Your vote is important. Without sufficient votes “FOR” its approval, we cannot implement the plan of conversion.
|
|
In addition, Jacksonville Bancorp-Federal stockholders are being asked to approve the adjournment of the special meeting, if necessary, to solicit additional proxies in the event that there are not sufficient votes at the time of the special meeting to approve the plan of conversion.
|
||
Stockholders also are asked to vote on the following informational proposals with respect to the articles of incorporation and bylaws of Jacksonville Bancorp-Maryland:
|
||
●
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote to approve certain amendments to Jacksonville Bancorp-Maryland’s articles of incorporation;
|
|
●
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote of stockholders to approve stockholder-proposed amendments to Jacksonville Bancorp-Maryland’s bylaws; and
|
|
●
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Jacksonville Bancorp-Maryland’s outstanding voting stock.
|
|
The provisions of Jacksonville Bancorp-Maryland’s articles of incorporation that are included as informational proposals were approved as part of the process in which our Board of Directors approved the plan of conversion. These proposals are informational in nature only, because the Office of Thrift Supervision’s regulations governing mutual-to-stock conversions do not provide for votes on matters other than the plan of conversion. While we are asking you to vote with respect to each of the informational proposals listed above, the proposed provisions for which an informational vote is requested will become effective if stockholders approve the plan of conversion, regardless of whether stockholders vote to approve any or all of the informational proposals. The provisions of Jacksonville Bancorp-Maryland’s articles of incorporation which are summarized above as informational proposals may have the effect of deterring, or rendering more difficult, attempts by third parties to obtain control of Jacksonville Bancorp-Maryland if such attempts are not approved by the Board of Directors, or may make the removal of the Board of Directors or management, or the appointment of new directors, more difficult.
|
Your vote is important. Without sufficient votes “FOR” approval of the plan of conversion, we cannot implement the plan of conversion and the related stock offering.
|
||
Q.
|
WHAT ARE THE REASONS FOR THE CONVERSION AND RELATED OFFERING?
|
|
A.
|
Our primary reasons for converting and raising additional capital through the offering are:
|
|
●
|
to increase our capital to support internal growth through lending in the communities we serve;
|
|
●
|
to enhance existing products and services and support the development of new products and services;
|
|
●
|
to facilitate growth through branch and whole bank acquisitions, as opportunities arise;
|
|
●
|
to improve our overall competitive position; and
|
|
●
|
to improve the liquidity of our shares of common stock and enhance stockholder returns through more flexible capital management strategies.
|
|
As a fully converted stock holding company, we will have greater flexibility in structuring mergers and acquisitions, including the form of consideration that we can use to pay for an acquisition. Our current mutual holding company structure limits our ability to offer shares of our common stock as consideration in a merger or acquisition since Jacksonville Bancorp, MHC is required to own a majority of Jacksonville Bancorp-Federal’s outstanding shares of common stock. Potential sellers often want stock for at least part of the purchase price. Our new stock holding company structure will enable us to offer stock or cash consideration, or a combination of stock and cash, and therefore will enhance our ability to compete with other bidders when acquisition opportunities arise. We currently have no arrangements or understandings regarding any specific acquisition.
|
||
|
||
Q.
|
WHAT WILL STOCKHOLDERS RECEIVE FOR THEIR EXISTING JACKSONVILLE BANCORP-FEDERAL SHARES?
|
|
A.
|
As more fully described in “Proposal 1 — Approval of the Plan of Conversion and Reorganization — Share Exchange Ratio,” depending on the number of shares sold in the offering, each share of common stock that you own at the time of the completion of the conversion will be exchanged for between 848,122 shares at the minimum and 1,147,459 shares at the maximum of the offering range (or 1,319,578 at the adjusted maximum of the offering range) of Jacksonville Bancorp-Maryland common stock (cash will be paid in lieu of any fractional shares).
For example, if you own 100 shares of Jacksonville Bancorp-Federal common stock, and the exchange ratio is 1.1312 (at the midpoint of the offering range), after the conversion you will receive 113 shares of Jacksonville Bancorp-Federal common stock and $0.12 in cash, the value of the fractional share, based on the $10.00 per share purchase price of stock in the offering.
|
If you own shares of Jacksonville Bancorp-Federal common stock in a brokerage account in “street name,” your shares will be automatically exchanged, and you do not need to take any action to exchange your shares of common stock. If you own shares in the form of Jacksonville Bancorp-Federal stock certificates after the completion of the conversion and stock offering, our exchange agent will mail to you a transmittal form with instructions to surrender your stock certificates. New certificates of Jacksonville Bancorp-Maryland common stock will be mailed to you within five business days after the exchange agent receives properly executed transmittal forms and your Jacksonville Bancorp-Federal stock certificates.
You should not submit a stock certificate until you receive a transmittal form.
|
|
Q.
|
WHY WILL THE SHARES THAT I RECEIVE BE BASED ON A PRICE OF $10.00 PER SHARE RATHER THAN THE TRADING PRICE OF THE COMMON STOCK PRIOR TO COMPLETION OF THE CONVERSION?
|
A.
|
The $10.00 per share price was selected primarily because it is a commonly selected per share price for mutual-to-stock conversion offerings. The amount of common stock Jacksonville Bancorp-Maryland will issue at $10.00 per share in the offering and the exchange is based on an independent appraisal of the estimated market value of Jacksonville Bancorp-Maryland, assuming the conversion and offering are completed. RP Financial, LC., an appraisal firm experienced in appraisal of financial institutions, has estimated that, as of February 19, 2010, this market value ranged from $18.5 million to $25.0 million, with a midpoint of $21.7 million. Based on this valuation, the number of shares of common stock of Jacksonville Bancorp-Maryland that existing public stockholders of Jacksonville Bancorp-Federal will receive in exchange for their shares of Jacksonville Bancorp-Federal common stock will range from 848,122 to 1,147,459, with a midpoint of 997,790 shares (with a value of approximately $8.5 million to $11.5 million, with a midpoint of $10.0 million, at $10.00 per share). If market conditions so warrant, the appraised value can be increased to $28.7 million, the adjusted maximum of the appraisal, and the number of shares issued in the exchange for existing shares of Jacksonville Bancorp-Federal can be increased to 1,319,578 (a value of $13.2 million, at $10.00 per share). The number of shares received by the existing public stockholders of Jacksonville Bancorp-Federal is intended to maintain their existing 45.9% ownership in our organization (excluding any new shares purchased by them in the offering and their receipt of cash in lieu of fractional exchange shares). The independent appraisal is based in part on Jacksonville Bancorp-Federal’s financial condition and results of operations, the pro forma impact of the additional capital raised by the sale of shares of common stock in the offering, and an analysis of a peer group of ten publicly traded savings bank and thrift holding companies that RP Financial, LC. considered comparable to Jacksonville Bancorp-Federal.
|
Q.
|
DOES THE EXCHANGE RATIO DEPEND ON THE TRADING PRICE OF JACKSONVILLE BANCORP-FEDERAL COMMON STOCK?
|
A.
|
No, the exchange ratio will not be based on the market price of Jacksonville Bancorp-Federal common stock. Therefore, changes in the price of Jacksonville Bancorp-Federal common stock between now and the completion of the conversion and offering will not affect the calculation of the exchange ratio.
|
Q.
|
WHY DOESN’T JACKSONVILLE BANCORP-FEDERAL WAIT TO CONDUCT THE CONVERSION AND OFFERING UNTIL THE STOCK MARKET IMPROVES SO THAT CURRENT STOCKHOLDERS CAN RECEIVE A HIGHER EXCHANGE RATIO?
|
A.
|
The Board of Directors believes that because the stock holding company form of organization and the capital raised in the conversion offer important advantages and that it is in the best interest of our stockholders to complete the conversion and offering sooner rather than later. There is no way to know when market conditions will change, when regulations governing conversion to stock form will change, or how they might change, or how changes in market conditions might affect stock prices for financial institutions. The Board of Directors concluded that it would be better to complete the conversion and offering now, under existing Office of Thrift Supervision conversion regulations and under a valuation that offers a fair exchange ratio to existing stockholders and an attractive price to new investors, rather than wait an indefinite amount of time for potentially better market conditions.
|
Q.
|
SHOULD I SUBMIT MY STOCK CERTIFICATES NOW?
|
A.
|
No. If you hold stock certificate(s), instructions for exchanging the certificates will be sent to you by our exchange agent
after
completion of the conversion. If your shares are held in “street name” (
e.g.,
in a brokerage account) rather than in certificate form, the share exchange will be reflected automatically in your account upon completion of the conversion.
|
Q.
|
HOW DO I VOTE?
|
A.
|
Mark your vote, sign each proxy card enclosed and return the card(s) to us, in the enclosed proxy reply envelope.
YOUR VOTE IS IMPORTANT. PLEASE VOTE PROMPTLY.
|
Q.
|
IF MY SHARES ARE HELD IN STREET NAME, WILL MY BROKER, BANK OR OTHER NOMINEE AUTOMATICALLY VOTE ON THE PLAN ON MY BEHALF?
|
A.
|
No. Your broker, bank or other nominee will not be able to vote your shares without instructions from you. You should instruct your broker, bank or other nominee to vote your shares, using the directions that they provide to you.
|
Q.
|
WHAT HAPPENS IF I DON’T VOTE?
|
A.
|
Your vote is very important. Not voting all the proxy card(s) you receive will have the same effect as voting
“against”
the plan of conversion.
Without sufficient favorable votes
“for”
the plan of conversion, we will not proceed with the conversion and offering.
|
Q.
|
WHAT IF I DO NOT GIVE VOTING INSTRUCTIONS TO MY BROKER, BANK OR OTHER NOMINEE?
|
A.
|
Your vote is important. If you do not instruct your broker, bank or other nominee to vote your shares, the unvoted proxy will have the same effect as a vote
“against”
the plan of conversion.
|
Q.
|
MAY I PLACE AN ORDER TO PURCHASE SHARES IN THE OFFERING, IN ADDITION TO THE SHARES THAT I WILL RECEIVE IN THE EXCHANGE?
|
A.
|
Yes. If you would like to receive a prospectus and stock order form, you must call our Stock Information Center at (877) 860-2070 , Monday through Friday between 9:00 a.m. and 5:00 p.m., Central Time. The Stock Information Center is closed weekends and bank holidays.
|
Eligible depositors of Jacksonville Savings Bank have priority subscription rights allowing them to purchase common stock in a subscription offering. Shares not purchased in the subscription offering may be available for sale to the public in a community offering, as described herein. In the event orders for Jacksonville Bancorp-Maryland common stock in a community offering exceed the number of shares available for sale, shares may be allocated (to the extent shares remain available) first to cover orders of natural persons residing in the Illinois counties of Cass, Greene, Macoupin, Montgomery, Morgan, Pike, Sangamon and Scott; second to cover orders of Jacksonville Bancorp-Federal stockholders as of [voting record date]; and thereafter to cover orders of the general public. Stockholders of Jacksonville Bancorp-Federal are subject to an ownership limitation.
|
|
Shares of common stock purchased in the offering by a stockholder and his or her associates or individuals acting in concert with the stockholder,
plus
any shares a stockholder and these individuals receive in the exchange for existing shares of Jacksonville Bancorp-Federal common stock, may not exceed 5% of the total shares of common stock of Jacksonville Bancorp-Maryland to be issued and outstanding after the completion of the conversion.
|
|
Q.
|
WILL THE CONVERSION HAVE ANY EFFECT ON DEPOSIT AND LOAN ACCOUNTS AT JACKSONVILLE SAVINGS BANK?
|
A.
|
No. The account number, amount, interest rate and withdrawal rights of deposit accounts will remain unchanged. Deposits will continue to be federally insured by the Federal Deposit Insurance Corporation up to the legal limit. Loans and rights of borrowers will not be affected. Depositors will no longer have voting rights in the mutual holding company, which will cease to exist, after the conversion and offering. Only stockholders of Jacksonville Bancorp-Maryland will have voting rights after the conversion and offering.
|
1.
|
The approval of a plan of conversion and reorganization (the “Plan”) whereby: (a) Jacksonville Bancorp, MHC and Jacksonville Bancorp, Inc., a Federal Corporation (“Jacksonville Bancorp-Federal”) will convert and reorganize from the mutual holding company structure to the stock holding company structure; (b) Jacksonville Bancorp, Inc., a Maryland corporation (“Jacksonville Bancorp-Maryland”), will become the new stock holding company of Jacksonville Savings Bank; (c) the outstanding shares of Jacksonville Bancorp-Federal other than those held by Jacksonville Bancorp, MHC, will be converted into shares of common stock of Jacksonville Bancorp-Maryland; and (d) Jacksonville Bancorp-Maryland will offer shares of its common stock for sale in a subscription offering, community offering and, possibly, a syndicated community offering;
|
||
2.
|
The approval of the adjournment of the special meeting, if necessary, to solicit additional proxies in the event that there are not sufficient votes at the time of the special meeting to approve the plan of conversion and reorganization;
|
||
3.
|
The following informational proposals:
|
||
3a.
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote to approve certain amendments to Jacksonville Bancorp-Maryland’s articles of incorporation;
|
||
3b
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote of stockholders to approve stockholder-proposed amendments to Jacksonville Bancorp-Maryland’s bylaws;
|
||
3c.
|
Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Jacksonville Bancorp-Maryland’s outstanding voting stock; and
|
||
4.
|
Such other business that may properly come before the meeting.
|
(i)
|
First, to depositors with accounts at Jacksonville Savings Bank with aggregate balances of at least $50.00 at the close of business on December 31, 2008.
|
|
(ii)
|
Second, to our tax-qualified employee benefit plans, including our employee stock ownership plan and 401(k) plan, which will receive nontransferable subscription rights to purchase in the aggregate up to 10.0% of the shares of common stock sold in the offering. Our employee stock ownership plan currently intends to purchase up to 4% of the shares of common stock sold in the offering, with the remaining shares in this purchase priority allocated to our 401(k) plan.
|
|
(iii)
|
Third, to depositors with accounts at Jacksonville Savings Bank with aggregate balances of at least $50.00 at the close of business on March 31, 2010.
|
|
(iv)
|
Fourth, to depositors of Jacksonville Savings Bank at the close of business on May 10, 2010 .
|
●
|
the purchase of shares by underwriters in connection with a public offering; or
|
|
●
|
the purchase of shares by any employee benefit plans of Jacksonville Bancorp-Federal or any subsidiary.
|
Amount (1)
|
|||||
* |
Registrant’s Legal Fees and Expenses
|
$ | 500,000 | ||
* |
Registrant’s Accounting Fees and Expenses
|
50,000 | |||
* |
Conversion Agent and Data Processing Fees
|
30,000 | |||
* |
Marketing Agent Fees (1)
|
383,585 | |||
* |
Marketing Agent Expenses (Including Legal Fees and Expenses)
|
57,500 | |||
* |
Appraisal Fees and Expenses
|
40,000 | |||
* |
Printing, Postage, Mailing and EDGAR Fees
|
204,000 | |||
* |
Filing Fees (OTS, Nasdaq, FINRA, IDFPR and SEC)
|
25,923 | |||
* |
Transfer Fees and Expenses
|
5,000 | |||
* |
Business Plan Fees and Expenses
|
32,000 | |||
* |
Other
|
55,577 | |||
* |
Total
|
$ | 1,383,585 |
* | Estimated | |
(1)
|
Jacksonville Bancorp, Inc. has retained Keefe Bruyette & Woods, Inc. to assist in the sale of common stock on a best efforts basis in the offerings. Fees are estimated at the adjusted maximum of the offering range.
|
Item 14.
|
Indemnification of Directors and Officers
|
Item 15. | Recent Sales of Unregistered Securities |
Not Applicable. |
Item 16. | Exhibits and Financial Statement Schedules: |
The exhibits and financial statement schedules filed as part of this registration statement are as follows: | |
*
|
Previously filed.
|
**
|
Supporting financial schedules filed in paper format only pursuant to Rule 202 of Regulation S-T. Available for inspection during business hours at the principal offices of the SEC in Washington, D.C.
|
(1)
|
Incorporated by reference to the Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 20, 2009 (File No. 000-49792).
|
(2)
|
Incorporated by reference to the Current Report on Form 8-K filed with the Securities and Exchange Commission on September 4, 2008 (File No. 000-49792).
|
(3)
|
Incorporated by reference to the registration statement on Form S-8 filed with the Securities and Exchange Commission on February 2, 2004 (File No. 333-112420).
|
(b)
|
Financial Statement Schedules
|
Item 17.
|
Undertakings
|
|
(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. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective 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.
|
|
(i)
|
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);
|
|
(ii)
|
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
|
|
(iii)
|
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
|
|
(iv)
|
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
|
JACKSONVILLE BANCORP, INC. | |||
By:
|
/s/ Richard A. Foss
|
||
Richard A. Foss
|
|||
President and Chief Executive Officer
|
|||
(Duly Authorized Representative)
|
Signatures
|
Title
|
Date
|
||
/s/ Richard A. Foss
|
President, Chief Executive
|
April 30 , 2010
|
||
Richard A. Foss
|
Officer and Director (Principal | |||
Executive Officer)
|
||||
/s/ Diana S. Tone
|
Chief Financial Officer
|
April 30 , 2010
|
||
Diana S. Tone | (Principal Financial and | |||
Accounting Officer)
|
||||
/s/ Andrew F. Applebee
|
Chairman of the Board
|
April 30 , 2010
|
||
Andrew F. Applebee
|
||||
/s/ Dean H. Hess
|
Director
|
April 30 , 2010
|
||
Dean H. Hess
|
||||
/s/ John L. Eyth
|
Director
|
April 30 , 2010
|
||
John L. Eyth
|
||||
/s/ Emily J. Osburn
|
Director
|
April 30 , 2010
|
||
Emily J. Osburn
|
||||
/s/ Harmon B. Deal, III
|
Director
|
April 30 , 2010
|
||
Harmon B. Deal, III
|
||||
/s/ John C. William
|
Director
|
April 30 , 2010
|
||
John C. Williams
|
||||
/s/ John M. Buchanan
|
Director
|
April 30 , 2010
|
||
John M. Buchanan
|
1.1
|
Engagement Letters between Jacksonville Bancorp, Inc., Jacksonville Savings Bank and Keefe, Bruyette & Woods, Inc. *
|
1.2
|
Form of Agency Agreement between Jacksonville Bancorp, MHC, Jacksonville Bancorp, Inc., a Maryland corporation, Jacksonville Savings Bank and Jacksonville Bancorp, Inc., a federal corporation, and Keefe, Bruyette & Woods, Inc.
|
2
|
Plan of Conversion and Reorganization, as amended
|
3.1
|
Form of Articles of Incorporation of Jacksonville Bancorp, Inc., as amended and restated
|
3.2
|
Bylaws of Jacksonville Bancorp, Inc. *
|
4
|
Form of Common Stock Certificate of Jacksonville Bancorp, Inc. *
|
5
|
Opinion of Luse Gorman Pomerenk & Schick, P.C. regarding legality of securities being registered *
|
8
|
Federal Tax Opinion of Luse Gorman Pomerenk & Schick, P.C.
|
10.1
|
Employment Agreement between Jacksonville Savings Bank and Andrew F. Applebee
(1)
|
10.2
|
Employment Agreement between Jacksonville Savings Bank and Richard A. Foss
(2)
|
10.3
|
Employment Agreement between Jacksonville Savings Bank and John Williams
(2)
|
10.4
|
Jacksonville Savings Bank and Jacksonville Bancorp, MHC 1996 Stock Option Plan
(3)
|
10.5
|
Jacksonville Savings Bank 2001 Stock Option Plan
(3)
|
10.6
|
Amendments to the Jacksonville Savings Bank and Jacksonville Bancorp, MHC Stock Option Plans*
|
10.7
|
Change in Control Agreement between Jacksonville Savings Bank and Diana Tone
|
10.8
|
Jacksonville Savings Bank Supplemental Life Insurance Plan *
|
10.9
|
Jacksonville Savings Bank Salary Continuation Plan 1
(2)
|
10.10
|
Jacksonville Savings Bank Long-Term Deferred Compensation Plan, as amended *
|
10.11
|
Deferred Compensation Agreement between Chapin State Bank and John C. Williams *
|
10.12
|
Director’s Compensation Agreement between Chapin State Bank and John C. Williams *
|
10.13
|
Deferred Compensation Agreement between Chapin State Bank and Dean H. Hess *
|
10.14
|
Director’s Compensation Agreement between Chapin State Bank and Dean H. Hess *
|
21
|
Subsidiaries of Registrant *
|
23.1
|
Consent of Luse Gorman Pomerenk & Schick, P.C. (contained in Opinions included as Exhibits 5 and 8)
|
23.2
|
Consent of BKD LLP
|
23.3
|
Consent of RP Financial, LC.
|
24
|
Power of Attorney (set forth on signature page)
|
99.1
|
Appraisal Agreement between
Jacksonville Savings Bank, and Jacksonville Bancorp, Inc., and Jacksonville Bancorp, MHC
and RP Financial, LC. *
|
99.2
|
Business Plan Agreement between Jacksonville Savings Bank and Keller & Company, Inc. *
|
99.3
|
Appraisal Report of RP Financial, LC. *, **
|
99.4
|
Letter of RP Financial, LC. with respect to Subscription Rights *
|
99.5
|
Letter of RP Financial, LC. with respect to Liquidation Rights *
|
99.6
|
Marketing Materials *
|
99.7
|
Stock Order and Certification Form *
|
99.8
|
Form of Proxy Card
|
_______________________ |
*
|
Previously filed.
|
**
|
Supporting financial schedules filed in paper format only pursuant to Rule 202 of Regulation S-T. Available for inspection during business hours at the principal offices of the SEC in Washington, D.C.
|
(1)
|
Incorporated by reference to the Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 20, 2009 (File No. 000-49792).
|
(2) |
Incorporated by reference to the Current Report on Form 8-K filed with the Securities and Exchange Commission on September 4, 2008 (File No. 000-49792).
|
(3) |
Incorporated by reference to the registration statement on Form S-8 filed with the Securities and Exchange Commission on February 2, 2004 (File No. 333-112420).
|
Jacksonville Bancorp, MHC
|
Jacksonville Bancorp, Inc.
|
||
(a federal corporation)
|
(a federal corporation)
|
||
By Its Authorized
|
By Its Authorized
|
||
Representative:
|
Representative:
|
||
|
|
||
Richard A. Foss
|
Richard A. Foss
|
||
President and Chief Executive Officer
|
President and Chief Executive Officer
|
||
Jacksonville Savings Bank
|
Jacksonville Bancorp, Inc.
|
||
(an Illinois savings bank)
|
(a Maryland corporation)
|
||
By Its Authorized
|
By Its Authorized
|
||
Representative:
|
Representative:
|
||
|
|
||
Andrew F. Applebee
|
Richard A. Foss
|
||
Chairman
|
President and Chief Executive Officer
|
By Its Authorized
Representative:
|
|
|
|
Harold Hanley
|
|
Managing Director
|
1
|
|||
1
|
|||
8
|
|||
10
|
|||
10
|
|||
11
|
|||
12
|
|||
12
|
|||
13
|
|||
13
|
|||
14
|
|||
15
|
|||
15
|
|||
16
|
|||
17
|
|||
18
|
|||
19
|
|||
20
|
|||
20
|
|||
22
|
|||
22
|
|||
23
|
|||
23
|
|||
24
|
|||
24
|
|||
24
|
|||
25
|
|||
26
|
|||
26
|
|||
27
|
|||
27
|
|||
27
|
|||
27
|
|||
28
|
EXHIBIT A
|
FORM OF AGREEMENT OF MERGER BETWEEN JACKSONVILLE BANCORP, MHC AND JACKSONVILLE BANCORP, INC.
|
EXHIBIT B
|
FORM OF AGREEMENT OF MERGER BETWEEN JACKSONVILLE BANCORP, INC. (FEDERAL) AND JACKSONVILLE BANCORP, INC. (MARYLAND)
|
EXHIBIT C
|
FORM OF ARTICLES OF INCORPORATION OF THE HOLDING COMPANY
|
EXHIBIT D
|
FORM OF BYLAWS OF THE HOLDING COMPANY
|
(1)
|
The Holding Company will be organized as a first-tier stock subsidiary of the Mid-Tier Holding Company.
|
||
(2)
|
The Mutual Holding Company will merge with and into the Mid-Tier Holding Company with the Mid-Tier Holding Company as the resulting entity (the “MHC Merger”) pursuant to the Agreement of Merger attached hereto as Exhibit A, whereby the shares of Mid-Tier Holding Company common stock held by the Mutual Holding Company will be canceled and Members of the Mutual Holding Company will constructively receive liquidation interests in the Mid-Tier Holding Company in exchange for their ownership interests in the Mutual Holding Company.
|
||
(3)
|
Immediately after the MHC Merger, the Mid-Tier Holding Company will merge with the Holding Company with the Holding Company as the resulting entity (the “Mid-Tier Merger”) pursuant to the Agreement of Merger attached hereto as Exhibit B, whereby the Bank will become the wholly-owned subsidiary of the Holding Company. As part of the Mid-Tier Merger, the liquidation interests in Mid-Tier Holding Company constructively received by the Members of the Mutual Holding Company as part of the MHC Merger will automatically, without further action on the part of the holders thereof, be exchanged for an interest in the Liquidation Account, and each of the Minority Shares shall automatically, without further action on the part of the holders thereof, be converted into and become the right to receive Holding Company Common Stock based upon the Exchange Ratio.
|
||
(4)
|
Immediately after the Mid-Tier Merger, the Holding Company will offer for sale the Holding Company Common Stock in the Offering.
|
||
(5) |
The Holding Company will contribute at least 50% of the net proceeds of the Offering to the Bank in constructive exchange for additional shares of common stock of the Bank and in exchange for the Bank Liquidation Account.
|
(1) |
Any exchange of such shares in connection with a merger or acquisition involving the Bank or the Holding Company, as the case may be, which has been approved by the appropriate federal regulatory agency; and
|
||
(2) |
Any disposition of such shares following the death of the person to whom such shares were initially sold under the terms of the Plan.
|
(1) |
Each certificate representing shares restricted by this section shall bear a legend prominently stamped on its face giving notice of the restriction;
|
||
(2) |
Instructions shall be issued to the stock transfer agent for the Holding Company not to recognize or effect any transfer of any certificate or record of ownership of any such shares in violation of the restriction on transfer; and
|
||
(3) |
Any shares of capital stock of the Holding Company issued with respect to a stock dividend, stock split, or otherwise with respect to ownership of outstanding Subscription Shares subject to the restriction on transfer hereunder shall be subject to the same restriction as is applicable to such Subscription Shares.
|
A. | (1) | The charter of the Bank may contain a provision stipulating that no person, except the Holding Company, for a period of five years following the closing date of the Conversion, may directly or indirectly acquire or offer to acquire the beneficial ownership of more than 10% of any class of equity security of the Bank, without the prior written approval of the Illinois Department. In addition, such charter may also provide that for a period of five years following the closing date of the Conversion, shares beneficially owned in violation of the above-described charter provision shall not be entitled to vote and shall not be voted by any person or counted as voting stock in connection with any matter submitted to stockholders for a vote. In addition, special meetings of the stockholders relating to changes in control or amendment of the charter may only be called by the Board of Directors, and shareholders shall not be permitted to cumulate their votes for the election of Directors. |
(2)
|
For a period of three years from the date of consummation of the Conversion, no person, other than the Holding Company, shall directly or indirectly offer to acquire or acquire the beneficial ownership of more than 10% of any class of equity security of the Bank without the prior written consent of the OTS and the Illinois Department.
|
(1) |
The term “person” includes an individual, a firm, a corporation or other entity;
|
||
(2) |
The term “offer” includes every offer to buy or acquire, solicitation of an offer to sell, tender offer for, or request or invitation for tenders of, a security or interest in a security for value;
|
||
(3) |
The term “acquire” includes every type of acquisition, whether effected by purchase, exchange, operation of law or otherwise; and
|
||
(4) |
The term “security” includes non-transferable subscription rights issued pursuant to a plan of conversion as well as a “security” as defined in 15 U.S.C. § 77b(a)(1).
|
Jacksonville Bancorp, Inc.
|
||||
(a federal corporation)
|
||||
ATTEST:
|
||||
By:
|
||||
John D. Eilering, Secretary
|
Richard A. Foss
|
|||
President and Chief Executive Officer
|
||||
Jacksonville Bancorp, MHC
|
||||
(a federal mutual holding company)
|
||||
ATTEST:
|
||||
By:
|
||||
John D. Eilering, Secretary
|
Richard A. Foss
|
|||
President and Chief Executive Officer
|
Jacksonville Bancorp, Inc.
|
||||
(a federal corporation)
|
||||
ATTEST:
|
||||
By:
|
||||
John D. Eilering, Secretary
|
Richard A. Foss
|
|||
President and Chief Executive Officer
|
||||
Jacksonville Bancorp, MHC
|
||||
(a federal mutual holding company)
|
||||
ATTEST:
|
||||
By:
|
||||
John D. Eilering, Secretary
|
Richard A. Foss
|
|||
President and Chief Executive Officer
|
(a)
|
An “affiliate” of a specified Person shall mean a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified.
|
||
(b)
|
“Beneficial ownership” shall be determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934 (or any successor rule or statutory provision), or, if said Rule 13d-3 shall be rescinded and there shall be no successor rule or statutory provision thereto, pursuant to said Rule 13d-3 as in effect on December 31, 2009; provided, however, that a Person shall, in any event, also be deemed the “beneficial owner” of any Common Stock:
|
||
(1)
|
that such Person or any of its affiliates beneficially owns, directly or indirectly; or
|
||
(2)
|
that such Person or any of its affiliates has (i) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of an agreement, contract, or other arrangement with the Corporation to effect any transaction of the type described in clause (i) or (ii) of the first sentence of Article 9 hereof) or upon the exercise of conversion rights, exchange rights, warrants, or options or otherwise, or (ii) sole or shared voting or investment power with respect thereto pursuant to any agreement, arrangement, understanding, relationship or otherwise (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of a revocable proxy granted for a particular meeting of stockholders, pursuant to a public solicitation of proxies for such meeting, with respect to shares of which neither such Person nor any such affiliate is otherwise deemed the beneficial owner); or
|
(3)
|
that are beneficially owned, directly or indirectly, by any other Person with which such first mentioned Person or any of its affiliates acts as a partnership, limited partnership, syndicate or other group pursuant to any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of capital stock of the Corporation; and provided further, however, that (i) no director or officer of the Corporation (or any affiliate of any such director or officer) shall, solely by reason of any or all of such directors or officers acting in their capacities as such, be deemed, for any purposes hereof, to beneficially own any Common Stock beneficially owned by any other such director or officer (or any affiliate thereof), and (ii) neither any employee stock ownership or similar plan of the Corporation or any subsidiary of the Corporation nor any trustee with respect thereto (or any affiliate of such trustee) shall, solely by reason of such capacity of such trustee, be deemed, for any purposes hereof, to beneficially own any Common Stock held under any such plan. For purposes of computing the percentage of beneficial ownership of Common Stock of a Person, the outstanding Common Stock shall include shares deemed owned by such Person through application of this subsection but shall not include any other shares of Common Stock that may be issuable by the Corporation pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or otherwise. For all other purposes, the outstanding Common Stock shall include only Common Stock then outstanding and shall not include any Common Stock that may be issuable by the Corporation pursuant to any agreement, or upon the exercise of conversion rights, warrants or options, or otherwise.
|
||
(c)
|
A “Person” shall mean any individual, firm, corporation, or other entity.
|
||
(d)
|
The Board of Directors shall have the power to construe and apply the provisions of this Section D and to make all determinations necessary or desirable to implement such provisions including, but not limited to, matters with respect to (i) the number of shares of Common Stock beneficially owned by any Person, (ii) whether a Person is an affiliate of another, (iii) whether a Person has an agreement, arrangement, or understanding with another as to the matters referred to in the definition of beneficial ownership, (iv) the application of any other definition or operative provision of this Section D to the given facts, or (v) any other matter relating to the applicability or effect of this Section D.
|
Class I Directors:
|
Term to Expire in
|
||
Dean H. Hess
|
2011
|
||
John C. Williams
|
2011
|
||
Harmon B. Deal, III
|
2011
|
||
Class II Directors
:
|
Term to Expire in
|
||
John L. Eyth
|
2012
|
||
Richard A. Foss
|
2012
|
||
John M. Buchanan
|
2012
|
||
Class III Directors
:
|
Term to Expire in
|
||
Andrew F. Applebee
|
2013
|
||
Emily J. Osburn
|
2013
|
||
Alan Schick, Incorporator
|
(1)
|
The Mid-Tier Holding Company will organize the Holding Company as a Maryland-chartered stock holding company subsidiary.
|
|
(2)
|
The Mutual Holding Company will merge with and into the Mid-Tier Holding Company with the Mid-Tier Holding Company as the resulting entity (the “MHC Merger”) whereby the shares of Mid-Tier Holding Company held by the Mutual Holding Company will be cancelled and the owners of the Mutual Holding Company (e.g., the depositors of the Bank) will constructively receive liquidation interests in Mid-Tier Holding Company in exchange for their liquidation interests in the Mutual Holding Company.
|
|
(3)
|
Immediately after the MHC Merger, the Mid-Tier Holding Company will merge with the Holding Company (the “Mid-Tier Merger”), with the Holding Company as the resulting entity. As part of the Mid-Tier Merger, the liquidation interests in Mid-Tier Holding Company constructively received by the former owners of Mutual Holding Company will automatically, without further action on the part of the holders thereof, be exchanged for an interest in the Liquidation Account and the Minority Shares will automatically, without further action on the part of the holders thereof, be converted into and become the right to receive Holding Company Common Stock based on the Exchange Ratio.
|
|
(4)
|
Immediately after the Mid-Tier Merger, the Holding Company will offer for sale Holding Company Common Stock in the Offering.
|
|
(5)
|
The Holding Company will contribute at least 50% of the net proceeds of the Offering to the Bank in constructive exchange for common stock of the Bank and the Bank Liquidation Account.
|
Very truly yours,
|
||
/s/ Luse Gorman Pomerenk & Schick, P.C. | ||
Luse Gorman Pomerenk & Schick, P.C.
|
(i)
|
a failure to elect or reelect or to appoint or reappoint Executive to the Executive’s position and title that the Executive held immediately prior to the Change in Control;
|
|
(ii)
|
a material change in Executive’s position to become one of lesser responsibility, importance, or scope than the position Executive held immediately prior to the Change in Control, or a material reduction in the benefits and perquisites provided to Executive from those being provided immediately prior to the Change in Control;
|
|
(iii)
|
a relocation of Executive’s principal place of employment by more than 30 miles from its location as of the date of this Agreement;
|
(iv)
|
a liquidation or dissolution of the Company or the Bank other than liquidations or dissolutions that are caused by reorganizations that do not affect the status of Executive; or
|
|
(v)
|
any other breach of this Agreement by the Bank.
|
(i)
|
pay Executive, or in the event of Executive’s subsequent death, Executive’s beneficiary or estate, as the case may be, as severance pay, a lump-sum cash payment equal to two (2) times the sum of: (i) the average annual base salary, bonus, and any other cash compensation earned by Executive during the two (2) calendar years immediately prior to the year in which Executive’s Date of Termination (as defined in Section 4 hereof) occurs, and (ii) the average amount of benefits received by Executive pursuant to any employee benefit plans maintained by the Bank during the two (2) calendar years immediately prior to the year in which Executive’s Date of Termination occurs. Such payment shall be payable within 30 calendar days following Executive’s Date of Termination.
|
|
(ii)
|
In addition, the Bank will provide continued life insurance coverage and non-taxable medical and dental insurance coverage substantially identical to the coverage maintained by the Bank for Executive prior to Executive’s termination for 24 months immediately following Executive’s Date of Termination.
|
JACKSONVILLE SAVINGS BANK
|
||||
By:
|
||||
Date
|
Name:
|
|||
Title:
|
|
|||
EXECUTIVE
|
||||
Date
|
Diana Tone
|
RP ® FINANCIAL, LC. |
|
Serving the Financial Services Industry Since 1988 |
Sincerely, | |||
|
|
/s/ RP F inancial , LC. | |
RP FINANCIAL, LC. |
Washington
Headquarters
|
|
Three
Ballston Plaza
|
Telephone:
(703) 528-1700
|
1100
North Glebe Road, Suite 1100
|
Fax
No.: (703) 528-1788
|
Arlington,
VA 22201
|
Toll-Free
No.: (866) 723-0594
|
www.rpfinancial.com
|
E-Mail:
mail@rpfinancial.com
|
FOR
|
AGAINST
|
ABSTAIN
|
|||
1.
|
The approval of a plan of conversion and reorganization , as amended (the “Plan”) whereby: (a) Jacksonville Bancorp, MHC and Jacksonville Bancorp, Inc., a Federal Corporation (“Jacksonville Bancorp-Federal”) will convert and reorganize from the mutual holding company structure to the stock holding company structure; (b) Jacksonville Bancorp, Inc., a Maryland corporation (“Jacksonville Bancorp-Maryland”), will become the new stock holding company of Jacksonville Savings Bank; (c) the outstanding shares of Jacksonville Bancorp-Federal other than those held by Jacksonville Bancorp, MHC, will be converted into shares of common stock of Jacksonville Bancorp-Maryland; and (d) Jacksonville Bancorp-Maryland will offer shares of its common stock for sale in a subscription offering, community offering and, possibly, a syndicated community offering;
|
o
|
o
|
o
|
|
2.
|
The approval of the adjournment of the Special Meeting, if necessary, to solicit additional proxies in the event that there are not sufficient votes at the time of the Special Meeting to approve the plan of conversion and reorganization;
|
o
|
o
|
o
|
|
3.
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The following informational proposals:
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3a.
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Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote to approve certain amendments to Jacksonville Bancorp-Maryland’s articles of incorporation;
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o
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o
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o
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3b.
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Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation requiring a super-majority vote of stockholders to approve stockholder-proposed amendments to Jacksonville Bancorp-Maryland’s bylaws; and
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o
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o
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o
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3c.
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Approval of a provision in Jacksonville Bancorp-Maryland’s articles of incorporation to limit the voting rights of shares beneficially owned in excess of 10% of Jacksonville Bancorp-Maryland’s outstanding voting stock.
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o
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o
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o
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Dated: _________________, 2010
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Check Box if You Plan to Attend the Special Meeting
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PRINT NAME OF STOCKHOLDER
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PRINT NAME OF STOCKHOLDER
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SIGNATURE OF STOCKHOLDER
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SIGNATURE OF STOCKHOLDER
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