Roanoke Times Copyright (c) 1995, Landmark Communications, Inc. DATE: SATURDAY, June 5, 1993 TAG: 9306050174 SECTION: BUSINESS PAGE: A-6 EDITION: METRO SOURCE: MAG POFF STAFF WRITER DATELINE: LENGTH: Medium
Under the proposal, filed with the Office of Thrift Supervision, Charter would offer its shareholders the right to buy 5.95 shares of the offering for each share they hold.
With 3,656,397 shares outstanding, Charter would issue purchase rights to 21,755,562. The anticipated price would be $2 a share, Charter said.
Dates for the offering will be scheduled after OTC approval, the company said.
If the offering circular is approved by the OTC, Charter said, it would enter into standby purchase arrangements with "high net worth individuals and institutional investors" to buy the shares that shareholders decline to purchase. That would ensure sale of the full issue, Charter officials said.
Charter's employees also would be eligible to buy shares under the proposal.
The offering, if the circular is approved by the OTC, would boost Charter's capital position. The OTC has already approved Charter's capital plan and its hiring of Wheat, First Securities Inc., a Richmond-based regional brokerage, as its adviser.
Charter in May wrote off $41.1 million in so-called goodwill, an intangible accounting credit it had received from federal regulators for taking over four failed thrifts in 1982 and 1984.
Regulators disallowed goodwill in 1989, but Charter filed suit to contest that action. It lost the suit in March and wrote off the goodwill.
That means the thrift lacks enough capital to meet federal requirements. The proposed stock issue would boost Charter's capital to meet the government standards, offsetting the lost paper value of the goodwill.
Shareholders voted at a special meeting Monday to raise the number of shares from 12.5 million to 50 million with the understanding that new shares would be issued.
Bristol-based Charter operates 26 offices in the Roanoke Valley, Southwest Virginia and Tennessee. As of March 31, the thrift had $692 million in assets and $592 million in deposits.
by CNB