SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 26, 1995
SDN BANCORP, INC.
(Exact name of registrant as specified in its charter)
(Delaware) (2-76555) (95-3683748)
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(State of other (Commission File Number) (I.R.S. Employer Identification
jurisdiction of Number)
incorporation)
135 Saxony Road, Encinitas, CA 92024-0905
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (610) 436-6888
Item 5. OTHER EVENTS
On October 26, 1995 SDN Bancorp, Inc. a Delaware corporation ("Bancorp")
and Liberty National Bank ("Liberty") signed an Agreement and Plan of Merger
(the "Agreement") under which Bancorp will acquire Liberty through a cash merger
(the "Merger"). Also party to the transaction is Dartmouth Capital Group, L.P.,
a Delaware limited partnership ("the Partnership") and Bancorp's largest
shareholder, which is expected to fund the transaction.
Under the terms of the Agreement, all of the outstanding shares of
Liberty's common stock (excepting only shares as to which dissenters rights have
been exercised and, with limited exceptions, shares beneficially owned by the
parties to the Agreement), will be converted into cash at the greater of $14.80
per share or 130% of Liberty's book value (subject to certain adjustments) per
share at the monthend preceeding the closing, calculated on a fully diluted
basis, in each case subject to possible small upward adjustments depending upon
the timing of the closing. The Agreement further provides that, prior to the
closing, Liberty will have canceled all outstanding options to acquire its
common stock, in each case in return for a payment to the holder of the option
equal to the spread between the exercise price of the option and the price per
share to be paid by Bancorp.
The Agreement outlines certain covenants by both parties prior to the
close of the transaction, including, but not limited to, an agreement by Liberty
not to solicit additional proposals to acquire Liberty and with limited
exceptions, not to respond to any such proposal from a third party.
The consummation of the Merger is subject to certain standard
conditions, including, but not limited to, the approval of the Agreement by the
holders of not less than two-thirds of Liberty's common stock and the receipt of
all required regulatory approvals. All of the Directors of Liberty have entered
into a Voting Agreement in which they have agreed to vote all of their
respective shares of common stock in favor of the Merger and against any
comparable transaction with a third party.
Either party may terminate the Agreement by written notice after noon
(Pacific time) on June 30, 1996 if the transaction has failed to close for
reasons other than a breach of any representation, warranty, covenant or
agreement by the terminating party.
Generally, each party to the Agreement is responsible for its own
expenses. However, Liberty is obligated to pay the expenses of the Partnership,
subject to a cap, if Liberty is unable to obtain shareholder approval or if the
Partnership terminates the Agreement due to certain conditions to the
obligations of the Partnership having not been satisfied.
Liberty is also obligated to pay the Partnership a termination fee, plus
expenses (subject to a cap), if Liberty or the Partnership terminates the
Agreement under certain circumstances including, without limitation and as a
condition to Liberty's termination of the Agreement, Liberty's pursuit of a
"Qualifying Strategic Transaction Proposal" as defined in the Agreement.
Further, the Partnership is also obligated to pay Liberty a termination fee,
plus expenses (subject to a cap), if Liberty terminates the Agreement because
the Partnership has breached any representation or warranty or failed to
perform, including the failure to provide funding for the transaction. In such
case, Bancorp has guaranteed the payment of the obligations of the Partnership.
The Agreement is attached hereto as an exhibit and is incorporated
herein by reference in its entirety. The foregoing summary of the Agreement
does not purport to be complete and is qualified in its entirety by reference
to the Agreement.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
a) Financial Statements NA
b) Pro Forma Financials NA
c) Exhibits:
2. Agreement and Plan of Merger dated October 26, 1995
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized
SDN Bancorp, Inc
Date: November 17, 1995 Robert P. Keller /s/
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Robert P. Keller
President and
Chief Executive Officer