-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GdJJ6MOb52mp7ww/NFd+J2iVvc5cIjErgprcy05b/1XLJBVl2J3eVrf6MDmopdMU 20iSxHpzUs75wYjkuqdDFA== 0000908184-97-000032.txt : 19970428 0000908184-97-000032.hdr.sgml : 19970428 ACCESSION NUMBER: 0000908184-97-000032 CONFORMED SUBMISSION TYPE: SC 13E4/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19970425 SROS: NASD SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN NATIONAL BANKSHARES INC CENTRAL INDEX KEY: 0000741516 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 541284688 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-50763 FILM NUMBER: 97587276 BUSINESS ADDRESS: STREET 1: 628 MAIN ST CITY: DANVILLE STATE: VA ZIP: 24541 BUSINESS PHONE: 8047925111 MAIL ADDRESS: STREET 1: 628 MAIN STREET CITY: DANVILLE STATE: VA ZIP: 24541 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN NATIONAL BANKSHARES INC CENTRAL INDEX KEY: 0000741516 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 541284688 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4/A BUSINESS ADDRESS: STREET 1: 628 MAIN ST CITY: DANVILLE STATE: VA ZIP: 24541 BUSINESS PHONE: 8047925111 MAIL ADDRESS: STREET 1: 628 MAIN STREET CITY: DANVILLE STATE: VA ZIP: 24541 SC 13E4/A 1 As filed with the Securities and Exchange Commission on April 25, 1997 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13E-4 ISSUER TENDER OFFER STATEMENT (Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934) (Amendment No. 1) AMERICAN NATIONAL BANKSHARES INC. (Name of Issuer) AMERICAN NATIONAL BANKSHARES INC. (Name of Person(s) Filing Statement) Common Stock, $1.00 Par Value Per Share (Title of Class of Securities) 027745108 (CUSIP Number of Class of Securities) Charles H. Majors President and Chief Executive Officer AMERICAN NATIONAL BANKSHARES INC. P. O. Box 191 628 Main Street Danville, Virginia 24543-0191 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of the Person(s) Filing Statement) Copies to: Kenneth J. Alcott, Esq. Hunton & Williams Riverfront Plaza, East Tower 951 East Byrd Street Richmond, Virginia 23219 April 9, 1997 (Date Tender Offer First Published, Sent or Given to Security Holders) CALCULATION OF FILING FEE Transaction Valuation* Amount of filing fee $6,750,000 $1,350 *Calculated solely for the purpose of determining the filing fee, based upon the purchase of 250,000 shares at $27.00 per share. X Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. Amount Previously Paid:N/A Filing Party:N/A Form or Registration No.:N/A Date Filed:N/A This Issuer Tender Offer Statement on Schedule 13E-4, dated as of April 9, 1997, relating to the offer by American National Bankshares Inc. (the "Company") to purchase 250,000 shares (or such lesser number of shares as are properly tendered) of its common stock, par value $1.00 per share (the "Shares"), at prices not in excess of $27.00 nor less than $25.00 net per Share in cash upon the terms and subject to the conditions set forth in the Offer to Purchase, dated April 9, 1997, and in the related Letter of Transmittal, which together constitute the "Offer", is hereby amended to incorporate the information included in the exhibits referred to below. Item 9. Material to be Filed as Exhibits. (a)(8) Form of The Carson Medlin Company analyst's report relating to the Company. (9) Form of Letter to Shareholders of the Company transmitting The Carson Medlin Company analyst's report. SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. April 25, 1997 AMERICAN NATIONAL BANKSHARES INC. By: /s/ Charles H. Majors Name:Charles H. Majors Title:President and Chief Executive Officer EXHIBIT INDEX Exhibit No. (a)(8) Form of The Carson Medlin Company analyst's report relating to the Company. (9) Form of Letter to Shareholders transmitting The Carson Medlin Company analyst's report. EX-19 2 Exhibit (a)(8) COMMUNITY BANK BULLETIN THE CARSON MEDLIN COMPANY AMERICAN NATIONAL BANKSHARES INC. Danville, Virginia OTC Bulletin Board: AMNB March 12, 1997 Current Price (3/11/97) $24.75 52 Week Price Range $23.25-28.88 1996 EPS $ 1.54 Price/Earnings - 1996 16.1X 1996 EPS $ 1.82 Price/Earnings - 1996 13.6X (operating) (operating) Book Value (12/31/96)$15.92 Price/Book 155% Annual Dividend $ 0.72 Dividend Yield 2.9% Shares Outstanding 3,279,798 Market Capitalization $81.2 million CORPORATE OVERVIEW American National Bankshares Inc. is the holding company for American National Bank, a $440 million asset, eleven office institution headquartered in Danville, Virginia. Since August of 1995, the Company has successfully completed two branch acquisitions and acquired the $85 million Mutual Savings Bank in Danville. To leverage off Mutual's strength in residential real estate lending, in late 1996 the Company created Mutual Mortgage of the Piedmont, Inc., a mortgage banking subsidiary. With a marketable stock, over $52 million in stockholders' equity, and an experienced market driven management, the Company is well positioned to continue to opportunistically fill in and expand the bank's franchise. RECENT FINANCIAL PERFORMANCE For the year ended December 31, 1996, the Company reported earnings from operations (before extraordinary items of $5,935,000, 15% higher than the $5,156,000 in 1995. Earnings per share from operations increased 14% from $1.60 in 1995 to $1.82 in 1996. Excluding nonrecurring items, the Company's return on assets was 1.46% and the return on equity was 11.9% for 1996. After extraordinary items in 1996, including merger-related expenses for the Mutual Savings acquisition and the one-time assessment for recapitalization of the SAIF Deposit Insurance Fund, the Company earned $5,032,000 or $1.54 per share. The strength of the Company's earnings has been masked to an extent by the noncash expense required to amortize the core deposit intangibles, which resulted from the branch acquisitions and reflects the premium paid to acquire the deposits. While the value of the franchise should actually increase with time and with good management, accounting rules require the amortization of intangible assets, which reduces reported earnings. At year end, the Company had $4.1 million (net) in core deposit intangibles, which were being amortized over ten years. This expense is a drag on reported earnings, but has, in our opinion, little or no impact on the true economic profits of the Company. Amortization expense for 1996 was $318,000. The Company's EPS, ROA and ROE (from operations) would have been $1.91, 1.54% and 12.6%, respectively without the amortization expense rather than $1.82, 1.46% and 11.9%. HIGHLIGHTS - - 1996 operating earnings up 15.1% to a record $5.9 million - - Acquisition of Yanceyville, NC branch makes AMNB a multi-state bank - - Mortgage banking subsidiary, Mutual Mortgage of the Piedmont, Inc., begins operations - - Total assets up 74% in two years to $440 million - - At 155% of book and 13.6X operating earnings, AMNB sells below the current community bank average Shares traded by: J.C. Bradford & Co. Scott & Stringfellow, Inc. Wheat First Butcher Singer Baird, Patrick & Co., Inc. Monroe Securities, Inc. Ryan, Beck & Co. American National Bankshares Inc. Table 1 Long Term Financial Performance*
($000's except per Year Ending December 31 share data) 1996 1995 1995 1993 1992 Total Assets $440,158 $388,479 $337,355 $327,908 $321,966 Loans, net 233,509 212,684 188,034 177,130 170,756 Deposits 361,983 327,342 282,791 283,322 279,936 Repurchase Agreement funding 15,059 9,572 6,105 0 0 Stockholders' Equity 52,218 48,912 45,045 42,815 39,706 Net Income 5,032 5,016 4,509 4,565 4,547 Net Income, adjusted (a) 5,935 5,156 4,509 4,565 4,547 Earnings per share $1.54 $1.56 $1.40 $1.42 $1.41 Earnings per share, adjusted (a) $1.82 $1.60 $1.40 $1.42 $1.41 Dividends per share $0.69 $0.56 $0.75 $0.47 $0.66 Book Value per share $15.92 $15.22 $14.02 $13.32 $12.36 ROAA 1.24% 1.43% 1.37% 1.41% 1.45% ROAA, Adjusted (a) 1.46% 1.47% 1.37% 1.41% 1.45% ROAE 10.1% 10.6% 10.1% 11.2% 11.8% ROAE, Adjusted (a) 11.9% 10.9% 10.1% 11.2% 11.8% Net interest margin 4.15% 4.40% 4.23% 4.10% 4.00% Equity/Assets 11.86% 12.59% 13.35% 13.06% 12.33% Nonperforming Assets Ratio (b) 0.22% 0.22% 0.16% 0.50% 0.66% (a) Net of one time merger related expenses in the first quarter and SAIF assessment in third quarter 1996 (b) Loans 90 days or more past due + nonaccrual Loans + OREO/Loans + OREO * Restated for merger with Mutual Savings Bank on a pooling basis in 1996
Since the Yanceyville branch was acquired late in 1996, amortization expense, which is not tax deductible, will be higher in 1997 and future years than it was in 1996, an estimated $460,000 per year. Largely as a result of increased expense for intangible amortization, we are projecting only a modest increase in per share earnings from operations for 1997, $1.90 per share. Excluding the amortization expense, we estimate per share earnings would be roughly 8% higher than reported earnings for 1997 or $2.05 per share. The Company's net interest margin declined in 1996 to 4.15% from 4.40% in 1995, principally due to increased reliance on, and increased interest expense for, time deposits and repurchase agreements. Noninterest income increased by $656,000 or 32% in 1996 over 1995. The increase was due to a higher level of trust income due to the closing of several large estates, new trust business and an increase in service charges. Asset quality at American National continues to be excellent. Nonperforming assets at year end were a low 0.22% of total loans. Net chargeoffs were also a low .17% of average net loans. Despite continued favorable loan loss experience, the Company increased the provision for loan losses in 1996 to $673,000 from $484,000 in 1995. The loan loss reserve increased to $3,070,000 or 1.30% of loans at year end 1996 from $2,757,000 or 1.28% of loans at year end 1995. ACQUISITIONS In August of 1995, the Company completed the acquisition of a former Crestar branch in Gretna, Virginia, added $36 million in deposits and $2 million in loans. The acquisition of Mutual Savings of Danville added two offices in Danville and an office in Collinsville. With nearly $16 million in capital at the time of the March 1996 acquisition and an equity to asset ratio of nearly 19%, Mutual also contributed considerable financial muscle to the combined organization. The second branch acquisition completed in late October of 1996 was for the former branch office of First South Bank, $22 million in deposits and $5 million in loans, in Yanceyville, North Carolina (roughly ten miles south of Danville), making the Company one of the few Virginia banks with a North Carolina office and multi-state operations. LONG-TERM PERFORMANCE The Company began 1995 with six offices, five ATMs and a little over $250 million in total assets. In two years management has built the institution to $440 million, 11 offices and seven ATMs. There are plans for two more ATMs in early 1997. Total assets have increased in the two years by 74%. In addition to expanding the franchise, management has pursued complementary business ventures. With the December 1996 opening of Mutual Mortgage of the Piedmont, Inc., the Company has moved formally into mortgage banking. This reflects the Company's strategy of building on the core competencies of the institution, taking advantage of low risk expansion opportunities while remaining vigilant on costs and maintaining focus. Because of the market's tendency to focus on reported earnings, we think that very little, if any, of the value management has created in the last two years has been reflected in the stock price. STOCK PRICE PERFORMANCE AMNB first appeared on NASDAQ's electronic OTC Bulletin Board in late 1995. At the recent price of $24.75 per share, the stock is trading at 155% of book value, 13.6X 1996 operating earnings, and 13.0X estimated 1997 earnings. Community banks in the Southeast were recently trading at an average 185% of book and 14.9X earnings. There are currently about 1,500 registered AMNB shareholders. Compared to other community banks AMNB's stock is relatively liquid. In 1996 186,000 or 5.7% of the Company's total shares changed hands. Officers and directors own approximately 8% of the outstanding shares. There is currently no institutional ownership. This is not a prospectus nor a solicitation of orders. Information presented herein, while obtained from sources believed to be reliable, is not guaranteed. The Carson Medlin Company ("CMC"), its principals or employees may from time to time have a position in the securities mentioned herein or may perform investment banking or other services for any of the companies mentioned. American National Bankshares Inc. has paid CMC twelve thousand five hundred dollars for past services and has agreed to compensate CMC eight thousand seven hundred and fifty dollars for its current services; there are currently no agreements to provide any future services. Any information contained herein of a nonfactual nature is the opinion of CMC and is subject to change without notice. The Carson Medlin Company, 1000 North Ashley Drive, Suite 517, Tampa, FL 33602. EX-20 3 Exhibit (a)(9) [American National Bankshares Inc. Letterhead] April 25, 1997 Dear Shareholder: Consistent with previous practice, I am forwarding to you a Community Bank Bulletin regarding American National Bankshares Inc., dated March 12, 1997, prepared by The Carson-Medlin Company. The Company engaged Carson-Medlin in 1996 to prepare quarterly analysts reports on the Company. This is the third of these reports. The first two were dated August 23, 1996 and December 6, 1996 and were previously made available to you by mail. The enclosed Bulletin is provided to our shareholders, and is made publicly available, for general information purposes only. The Bulletin does not constitute a statement by or the opinion of the Company or its officers or directors, and in no way constitutes a recommendation to tender, or to not tender, shares of the Company's stock in connection with the currently pending self-tender offer, which was commenced by the Company on April 9, 1997. Sincerely, /s/ Charles H. Majors Charles H. Majors President and Chief Executive Officer CHM/chc Enclosures -----END PRIVACY-ENHANCED MESSAGE-----