SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1 TO CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 31, 1998
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COMMERCIAL FEDERAL CORPORATION
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(Exact name of registrant as specified in its charter)
NEBRASKA 1-11515 47-0658852
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) dentification Number)
2120 SOUTH 72nd STREET, OMAHA, NEBRASKA 68124
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (402) 554-9200
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NOT APPLICABLE
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(Former name or former address, if changed since last report)
1
COMMERCIAL FEDERAL CORPORATION
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FORM 8-K/A
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AMENDMENT NO. 1 TO CURRENT REPORT
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits:
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On July 31, 1998, Commercial Federal Corporation ("Commercial Federal")
consummated its acquisition of AmerUs Bank ("AmerUs"), a wholly-owned
subsidiary of AmerUs Group Co. AmerUs was a federally chartered savings
bank headquartered in Des Moines, Iowa.
On August 14, 1998, Commercial Federal consummated its acquisition of First
Colorado Bancorp, Inc. ("First Colorado"). First Colorado, headquartered
in Lakewood, Colorado, was a unitary savings and loan holding company and
the parent company of First Federal Bank of Colorado, a federally chartered
stock savings bank.
The unaudited pro forma consolidated financial information set forth herein
was prepared for purposes of complying with Regulation S-X of the
Securities and Exchange Commission in connection with the filing of the
respective Forms 8-K of Commercial Federal relating to the acquisitions of
AmerUs and First Colorado since such acquisitions are significant to the
financial statements of Commercial Federal.
Item 7(a). Financial Statements of Business Acquired:
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The unaudited consolidated financial statements as of June 30, 1998, and
for the six months ended June 30, 1998 and 1997, and the audited
consolidated financial statements as of December 31, 1997 and 1996, and for
the years ended December 31, 1997 and 1996, of AmerUs are included herein
as Exhibits 99(a) and 99(b), respectively.
The unaudited consolidated financial statements of First Colorado (File
No. 0-27126) as of June 30, 1998, and for the three and six months ended
June 30, 1998 and 1997, are incorporated by reference to Item 1 of the
First Colorado Quarterly Report on Form 10-Q for the quarter ended June 30,
1998. The audited consolidated financial statements of First Colorado as of
December 31, 1997, and for the three years ended December 31, 1997, are
incorporated by reference to Item 8 of the First Colorado Annual Report on
Form 10-K for the year ended December 31, 1997.
Item 7(b). Pro Forma Financial Information:
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Filed as a part of this Current Report Form 8-K/A is the required unaudited
pro forma combined statement of financial position as of June 30, 1998, and
the unaudited pro forma condensed combined statements of operations for the
three years ended June 30, 1998.
The pro forma data are presented for comparative purposes only and are not
necessarily indicative of the future financial position or results of
operations of the combined company or of the combined financial position or
the results of operations that would have been realized had the
acquisitions of AmerUs and First Colorado been consummated during the
periods or as of the date for which the pro forma data are presented.
2
COMMERCIAL FEDERAL CORPORATION
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FORM 8-K/A
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AMENDMENT NO. 1 TO CURRENT REPORT
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Item 7(c). Exhibits:
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Exhibit 23. Consent of KPMG Peat Marwick LLP.
Exhibit 99(a). Unaudited consolidated financial statements of AmerUs Bank
and Subsidiaries as of June 30, 1998, and for the six
months ended June 30, 1998 and 1997.
Exhibit 99(b). Audited consolidated financial statements of AmerUs Bank
and Subsidiaries as of December 31, 1997 and 1996, and for
the years ended December 31, 1997 and 1996.
Exhibit 99(c). Unaudited consolidated financial statements of First
Colorado as of June 30, 1998, and for the three and six
months ended June 30, 1998 and 1997 (incorporated by
reference to Item 1 of the First Colorado Quarterly Report
on Form 10-Q for the quarter ended June 30, 1998).
Exhibit 99(d). Audited consolidated financial statements of First Colorado
as of December 31, 1997, and for the three years ended
December 31, 1997 (incorporated by reference to Item 8 of
the First Colorado Annual Report on Form 10-K for the year
ended December 31, 1997).
3
SIGNATURES
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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 thereunto duly authorized.
COMMERCIAL FEDERAL CORPORATION
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(Registrant)
Date: October 14, 1998 /s/ James A. Laphen
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James A. Laphen, President, Chief Operating
Officer and Chief Financial Officer (Duly
Authorized and Principal Financial Officer)
Date: October 14, 1998 /s/ Gary L. Matter
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Gary L. Matter, Senior Vice President,
Controller and Secretary
(Principal Accounting Officer)
4
COMMERCIAL FEDERAL CORPORATION
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Item 7(b). Pro Forma Financial Information.
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On July 31, 1998, Commercial Federal consummated its acquisition of AmerUs.
Under the terms of the Stock Purchase Agreement, Commercial Federal acquired
through a taxable acquisition all of the outstanding shares of the common stock
of AmerUs for total consideration of $178,269,000. Such consideration consisted
of (i) certain assets retained by AmerUs Group Co. in lieu of cash (primarily
FHA Title One single-family residential mortgage loans and a receivable for
income tax benefits) totaling approximately $85,027,000, (ii) cash (as adjusted
per the agreement) totaling $53,242,000, and (iii) a one-year promissory note
for $40,000,000 bearing interest, adjusted monthly, at 150 basis points over the
one-year Treasury bill rate. AmerUs was a federally chartered savings bank
headquartered in Des Moines, Iowa and operated 47 branches in Iowa (26),
Missouri (8), Nebraska (6), Kansas (4), Minnesota (2) and South Dakota (1). The
acquisition was accounted for as a purchase.
On August 14, 1998, Commercial Federal consummated its acquisition of First
Colorado. Under the terms of the agreement, Commercial Federal acquired in a
tax-free reorganization all 18,564,766 outstanding shares of First Colorado's
common stock in exchange for 18,278,789 shares of its common stock. Based on
Commercial Federal's closing stock price of $26.375 at August 14, 1998, the
total consideration for this acquisition, including cash paid for fractional
shares, approximated $482,154,000. An additional requirement of the transaction
with First Colorado was the issuance of 1,400,000 shares of First Colorado
common stock immediately prior to the consummation of the merger. Such
requirement was necessary to cure the taint on the treasury stock of First
Colorado so this transaction could be accounted for as a pooling of interests.
These shares offered directly by First Colorado resulted in gross cash proceeds
(prior to any transaction costs) of $33,425,000 less the placement agent's
commission of $919,000, or net proceeds to First Colorado totaling $32,506,000.
First Colorado, headquartered in Lakewood, Colorado, was a unitary savings and
loan holding company and the parent company of First Federal Bank of Colorado, a
federally chartered stock savings bank that operated 27 branches located in
Colorado, with 23 branches located in the Denver metropolitan area and four in
Colorado's western slope region. The acquisition was accounted for as a pooling
of interests.
The unaudited pro forma combined statement of financial condition as of June 30,
1998, and the unaudited pro forma condensed combined statements of operations
and diluted earnings per share for the fiscal years ended June 30, 1998, 1997
and 1996 presented on the following pages do not include any expected cost
savings or the benefits of related synergies as a result of the mergers of
AmerUs and First Colorado, do not reflect any nonrecurring merger transaction
costs, nor do they reflect all purchase accounting adjustments other than those
described in the accompanying notes, and are not necessarily indicative of the
results that would have occurred if the mergers of AmerUs and First Colorado had
been consummated on June 30, 1998, or had occurred as of the beginning of the
fiscal year ended June 30, 1996 for the First Colorado acquisition accounted for
as a pooling-of-interests and as of the beginning of the fiscal year ended June
30, 1998 for the AmerUs acquisition accounted for as a purchase, or which may be
obtained in the future.
5
Commercial Federal Corporation
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Item 7(b). Pro Forma Financial Information
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Unaudited Pro Forma Combined Statement of Financial Condition
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Commercial AmerUs Pro Forma
Federal Bank Adjustments
ASSETS: --------------------------------------------------------------
(In thousands)
Cash $ 131,336 $ 38,304 $ 45,000 A
(53,242) A
Investment securities available for sale 140,359 - -
Mortgage-backed securities available for sale 165,697 123,601 -
Loans held for sale, net 289,666 30,084 2,193 C
Investment securities held to maturity 455,028 - -
Mortgage-backed securities held to maturity 748,589 - -
Loans and leases receivable, net 6,412,712 1,053,069 3,865 C
(75,656) A
Federal Home Loan Bank stock 119,431 13,182 -
Interest receivable, net 58,119 11,379 -
Real estate, net 20,831 4,446 -
Premises and equipment, net 111,803 18,377 -
Prepaid expenses and other assets 125,924 18,662 (9,371) A
Intangible assets, net 73,145 1,685 (1,685) C
111,685 C
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Total Assets $8,852,640 $1,312,789 $ 22,789
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Deposits $5,363,140 $ 957,624 $ 6,238 C
Advances from Federal Home Loan Bank 2,271,772 215,525 2,515 C
Securities sold under agreements to repurchase 334,294 - -
Other borrowings 106,577 7,352 40,000 A
45,000 A
Interest payable 35,925 - -
Other liabilities 97,893 27,221 34,103 C
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Total liabilities 8,209,601 1,207,722 127,856
Commitments and contingencies - - -
Stockholders' Equity:
Preferred stock - - -
Common stock 421 3 (3) B
Additional paid-in capital 233,727 44,929 (44,929) B
Retained earnings 409,735 61,375 (61,375) B
Unearned Employee Stock Ownership Plan (ESOP) shares (1,383) - -
Unrealized holding gain (loss) on securities
available for sale, net 539 (1,240) 1,240 B
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643,039 105,067 (105,067)
Less treasury stock, at cost - - -
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Total Stockholders' Equity 643,039 105,067 (105,067)
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Total Liabilities and Stockholders' Equity $8,852,640 $1,312,789 $ 22,789
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Pro Forma First Pro Forma Pro Forma
Combined Colorado Adjustments Combined
ASSETS: ----------------------------------------------------------
(In thousands)
Cash $ 161,398 $ 85,676 $ 32,506 D $ 279,580
Investment securities available for sale 140,359 757 - 141,116
Mortgage-backed securities available for sale 289,298 5,696 - 294,994
Loans held for sale, net 321,943 - - 321,943
Investment securities held to maturity 455,028 77,160 - 532,188
Mortgage-backed securities held to maturity 748,589 171,867 - 920,456
Loans and leases receivable, net 7,393,990 1,155,580 - 8,549,570
Federal Home Loan Bank stock 132,613 11,701 - 144,314
Interest receivable, net 69,498 8,234 - 77,732
Real estate, net 25,277 166 - 25,443
Premises and equipment, net 130,180 23,148 - 153,328
Prepaid expenses and other assets 135,215 2,605 - 137,820
Intangible assets, net 184,830 4,040 - 188,870
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Total Assets $10,188,218 $1,546,630 $ 32,506 $11,767,354
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Deposits 6,327,002 $1,195,067 $ - $ 7,522,069
Advances from Federal Home Loan Bank 2,489,812 107,410 - 2,597,222
Securities sold under agreements to repurchase 334,294 - - 334,294
Other borrowings 198,929 4,097 - 203,026
Interest payable 35,925 - - 35,925
Other liabilities 159,217 21,900 - 181,117
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Total liabilities 9,545,179 1,328,474 - 10,873,653
Commitments and contingencies - - - -
Stockholders' Equity:
Preferred stock - - - -
Common stock 421 2,013 140 D 604
(2,153) E
183 E
Additional paid-in capital 233,727 154,463 32,366 D 370,186
(183) E
(50,187) E
Retained earnings 409,735 124,510 - 534,245
Unearned Employee Stock Ownership Plan (ESOP) shares (1,383) (10,021) - (11,404)
Unrealized holding gain (loss) on securities
available for sale, net 539 (469) - 70
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643,039 270,496 (19,834) 893,701
Less treasury stock, at cost - (52,340) 52,340 E -
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Total Stockholders' Equity 643,039 218,156 32,506 893,701
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Total Liabilities and Stockholders' Equity $10,188,218 $1,546,630 $ 32,506 $11,767,354
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See footnotes on the following page.
COMMERCIAL FEDERAL CORPORATION
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Item 7(b). Pro Forma Financial Information.
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A. Represents the cash paid and the purchase notes totaling $40,000,000
executed for the purchase of AmerUs' common stock, the dispositions of
certain assets of AmerUs per the Stock Purchase Agreement plus the gain
and/or losses, net of tax, realized upon such dispositions. These pro forma
adjustments reflect that the cash portion paid for AmerUs' common stock is
funded in part by a $45,000,000 promissory note with a five-year maturity,
quarterly principal payments of $1,250,000 and bearing a monthly rate of
interest which is priced at 100 basis points below the quoted national base
prime rate.
B. Represents the elimination of the stockholders' equity accounts of AmerUs
since this transaction is accounted for as a purchase.
C. The acquisition of AmerUs is accounted for as a purchase and these pro
forma adjustments represent the estimated fair value of AmerUs' related
assets and liabilities. The excess of the purchase price over the fair
value of the net assets acquired on a pro forma basis is estimated to total
$110,000,000 of which $16,264,000 is allocated to core value of deposits,
and $93,736,000 to goodwill for these unaudited pro forma combined
financial statements.
D. Represents the 1,400,000 shares of First Colorado common stock issued prior
to the consummation of the merger:
Total consideration (1,400,000 shares x $23.875 per share) $33,425,000
Less commissions and other expenses of issuance and distribution (919,000)
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Net cash proceeds $32,506,000
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Accounting for the transaction:
Par value ($.10 per share) $ 140,000
Additional paid-in capital 32,366,000
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$32,506,000
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The purpose of the issuance of the 1,400,000 shares of First Colorado
common stock is to permit the merger to be accounted for as a pooling-of-
interests under generally accepted accounting principles. For purposes of
these pro forma adjustments the net cash proceeds were assumed to remain in
non-interest-earning assets.
E. Represents the tax-free exchange of .9847 shares of Commercial Federal
common stock for each share of First Colorado common stock (18,564,766 net
outstanding shares) surrendered in connection with this acquisition,
adjusted for the issuance of 1,400,000 shares, resulting in 18,278,789
shares of Commercial Federal common stock issued. No consideration was
given for fractional shares in these pro forma adjustments. Fractional
shares were paid in cash.
Nonrecurring pre-tax expenses and charges estimated to approximate $25,000,000
associated with the First Colorado merger are not included in this unaudited
historical pro forma combined statement of financial condition.
7
Commercial Federal Corporation
Item 7(b). Pro Forma Financial Information
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended June 30, 1998
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Commercial AmerUs Pro Forma Pro Forma First Pro Forma
(In thousands, except per share data) Federal Bank Adjustments Combined Colorado Combined
----------- -------- ----------- ----------- ----------- ------------
Interest income $ 647,618 $112,849 $ (2,773) A $ 757,694 $ 110,070 $ 867,764
Interest expense 417,188 67,556 1,366 A 486,110 60,201 546,311
----------- -------- ----------- ----------- ----------- -----------
Net interest income 230,430 45,293 (4,139) 271,584 49,869 321,453
Provision (credit) for loan and lease losses 15,325 8,324 - 23,649 (1,472) 22,177
----------- -------- ----------- ----------- ----------- -----------
Net interest income after provision for
loan and lease losses 215,105 36,969 (4,139) 247,935 51,341 299,276
----------- -------- ----------- ----------- ----------- -----------
Noninterest income 88,265 25,168 - 113,433 9,069 122,502
Noninterest expense 195,295 44,318 7,127 A 246,740 28,716 275,456
----------- -------- ----------- ----------- ----------- -----------
Income before income taxes 108,075 17,819 (11,266) 114,628 31,694 146,322
Provision for income taxes 40,742 6,953 (2,548) 45,147 11,614 56,761
----------- -------- ----------- ----------- ----------- -----------
Net income $ 67,333 $ 10,866 $ (8,718) $ 69,481 $ 20,080 $ 89,561
=========== ======== ======== =========== =========== ===========
Diluted earnings per common share $ 1.62 $ 43.46 $ 1.67 $ 1.23 $ 1.52 B
=========== ======== =========== =========== ===========
Weighted average diluted
common shares outstanding 41,693,226 250,000 41,693,226 16,278,946 59,101,684 B
=========== ======== =========== =========== ===========
See footnotes on the following pages.
8
Commercial Federal Corporation
Item 7(b). Pro Forma Financial Information
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Years Ended June 30,
--------------------------------------------------------------------------------
1997 1996
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Commercial First Pro Forma Commercial First Pro Forma
(In thousands, except per share data) Federal Colorado Combined Federal Colorado Combined
----------- ----------- ----------- ----------- --------- -----------
Interest income $ 607,604 $ 104,628 $ 712,232 $ 575,733 $ 94,263 $ 669,996
Interest expense 396,775 57,194 453,969 378,580 58,863 437,443
----------- ----------- ----------- ----------- --------- -----------
Net interest income 210,829 47,434 258,263 197,153 35,400 232,553
Provision (credit) for loan and lease losses 12,284 1,143 13,427 7,211 (495) 6,716
----------- ----------- ----------- ----------- --------- -----------
Net interest income after provision for loan
and lease losses 198,545 46,291 244,836 189,942 35,895 225,837
Noninterest income 81,133 5,498 86,631 68,768 5,206 73,974
Noninterest expense 194,142 30,506 224,648 159,774 21,317 181,091
----------- ----------- ----------- ----------- --------- -----------
Income before income taxes and extraordinary
items 85,536 21,283 106,819 98,936 19,784 118,720
Provision for income taxes 30,069 7,911 37,980 32,741 7,146 39,887
----------- ----------- ----------- ----------- --------- -----------
Income before extraordinary items $ 55,467 $ 13,372 $ 68,839 $ 66,195 $ 12,638 $ 78,833
=========== =========== =========== =========== ========= ===========
Diluted earnings per common share $ 1.35 $ .73 $ 1.14 B $ 1.59 $ 1.96 $ 1.26 B
=========== =========== =========== =========== ========= ===========
Weighted average diluted common shares
outstanding 41,020,167 18,354,268 60,472,194 B 41,692,377 6,433,838 62,787,936 B
=========== =========== =========== =========== ========= ===========
See footnotes on the following pages.
6
COMMERCIAL FEDERAL CORPORATION
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Item 7(b). Pro Forma Financial Information.
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A. The unaudited pro forma condensed combined statements for the fiscal years
ended June 30, 1998, 1997 and 1996 present the combined revenues and
expenses and pro forma adjustments as if the mergers of AmerUs and First
Colorado had occurred as of the beginning of the fiscal year ended June 30,
1996, for the First Colorado acquisition accounted for as a pooling-of-
interests, and as of the beginning of the fiscal year ended June 30, 1998
for the AmerUs acquisition accounted for as a purchase. The pro forma
adjustments below represent the estimated fair value of the related assets
and liabilities of AmerUs.
The excess of the purchase price over the fair value of the net assets of
AmerUs acquired on a pro forma basis is estimated to total $110,000,000 of
which $16,264,000 is allocated to core value of deposits and $93,736,000 to
goodwill for these unaudited pro forma combined financial statements. Net
income on a pro forma basis was reduced for the accelerated amortization
expense of core value of deposits estimated over a 10-year period and the
straight line amortization expense of goodwill estimated over a 20-year
period; and adjustments were made to interest expense on the $45,000,000
note, the proceeds of which were used to partially fund the purchase of the
common stock of AmerUs in this transaction, and on the $40,000,000 purchase
notes pursuant to the Stock Purchase Agreement.
The following are the effects of the amortization of the pro forma purchase
accounting adjustments for AmerUs for the fiscal year ended June 30, 1998,
assuming this acquisition had been consummated as of the beginning of
fiscal year 1998.
Interest income:
Purchase accounting adjustments on loans $(2,773,000)
===========
Interest expense:
Purchase accounting adjustments on deposits $(3,306,000)
Purchase accounting adjustments on advances
from Federal Home Loan Bank (1,383,000)
Interest on note borrowed to partially fund the cash
portion for the purchase of AmerUs common stock 3,280,000
Interest on Purchase Notes payable to AmerUs Group
Co. for the purchase of AmerUs common stock 2,775,000
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$ 1,366,000
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Noninterest expense:
Amortization of core value of deposits $ 2,440,000
Amortization of goodwill 4,687,000
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$ 7,127,000
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10
COMMERCIAL FEDERAL CORPORATION
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Item 7(b). Pro Forma Financial Information.
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B. Pro forma combined diluted earnings per common share and weighted average
diluted common shares outstanding are based upon an exchange ratio of .9847
and the additional issuance of 1,400,000 shares of First Colorado common
stock prior to the consummation of the merger. Such pro forma assumptions
result in the issuance of Commercial Federal weighted average shares of
common stock totaling 17,408,458, 19,452,027 and 21,095,559, respectively,
for the years ended June 30, 1998, 1997 and 1996.
C. Commercial Federal's fiscal year end is June 30, and First Colorado's
fiscal year end is December 31. Historical results of operations for First
Colorado for the year ended June 30, 1998, represent its results of
operations for the four fiscal quarters then ended. Historical results of
operations for First Colorado for the years ended June 30, 1997, and June
30, 1996, represent First Colorado's reported results of operations for the
fiscal years ended December 31, 1996 and 1995, respectively.
Nonrecurring pre-tax expenses and charges estimated to approximate $25,000,000
associated with the First Colorado merger are not included in this unaudited
historical pro forma combined statements of operations.
11