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HF BANCORP, INC.
445 EAST FLORIDA AVENUE, HEMET, CA 92543-4244
MAILING ADDRESS: P.O. BOX 12006, HEMET, CA 92546-8006
NEWS RELEASE
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FOR ADDITIONAL INFORMATION, CALL J. ROBERT EICHINGER AT
909-658-4418, EXT. 201.
MAY 10, 1996
FOR IMMEDIATE RELEASE
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HEMET FEDERAL TO ACQUIRE
PALM SPRINGS SAVINGS BANK
HF Bancorp, Inc. (NASDAQ: HEMT), the holding company for Hemet Federal
Savings and Loan Association, today announced that the Association has signed a
definitive agreement to acquire Palm Springs Savings Bank. The announcement was
made jointly by Hemet Federal Chairman & CEO J. Robert Eichinger and Palm
Springs President & CEO Stephen G. Hoffmann. Hemet Federal agreed to pay Palm
Springs shareholders $14.375 in cash for each share held, or $16,257,349 in
total for 1,130,946 shares outstanding.
With the acquisition, Hemet Federal will be adding four branches with
approximately $175 million in deposits - in the Coachella Valley communities of
Palm Springs, Rancho Mirage, Cathedral City and Desert Hot Springs. This comes
on top of the Association's recently announced plan to purchase three San Diego
County offices form Hawthorne Savings, with $168 million in deposits. When both
transactions are completed, Hemet Federal will be a nineteen branch institution
with approximately $825 million in deposits and over $1 billion in assets -
making in the largest financial Institution headquartered in Riverside County.
The acquisition agreement is subject to approval by the shareholders of
Palm Springs, approval of the appropriate regulatory authorities, and the
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HF Bancorp, Inc.
May 10, 1996
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satisfaction of certain other customary conditions. In connection with the
transaction, there is a provision for a termination fee payable to HF Bancorp if
the transaction is not consummated under certain conditions. Under certain
circumstances, HF Bancorp would be required to pay liquidated damages to Palm
Springs. In addition, the directors and officers of Palm Springs and certain
others with substantial stock ownership in Palm Springs have signed agreements
to vote their stock in favor of the agreement.
Reacting to the announcement of the acquisition, Hemet Federal Chairman &
CEO J. Robert Eichinger stated, "We are thrilled by this opportunity to enter
the Coachella Valley. It is an area into which we have seriously considered
expanding for some time, and to be able to do so with an immediate four-branch
presence is indeed exciting. This acquisition will enable us to offer additional
products and services which have been so successfully developed and implemented
by Palm Springs Savings Bank, particularly in the small business sector, and
offer them at all nineteen offices. The consolidation of support services will
allow us to more effectively and efficiently serve our valued customers
throughout the newly expanded branch network. And we are truly delighted to
welcome Steve Hoffmann and other highly talented Palm Springs employees to Hemet
Federal. They will be excellent additions to our team."
Palm Springs Savings Bank President and CEO Stephen G. Hoffmann, who will
join Hemet Federal as President & Managing Officer, said, "This is truly a good
move for both organizations. The infusion of added capital will enable us to
provide a higher level of service to our Coachella Valley communities and
residents, and will enable our customers to conduct their financial business at
many additional locations in Western Riverside County and North San Diego
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HF Bancorp, Inc.
May 10, 1996
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County."
The acquisition, which is subject to regulatory approval, is expected to
be completed by September 30, 1996. Upon completion of the acquisition, the four
branches of Palm Springs Savings Bank will continue to operate under that name,
as a division of Hemet Federal.
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