Exhibit 99.1(a)(1)(i)
OFFER TO PURCHASE FOR CASH
BY
RSV BANCORP, INC.
OF
UP TO 202,000 SHARES OF COMMON STOCK, PAR VALUE $0.10
AT A PURCHASE PRICE
NOT GREATER THAN $19.00 NOR LESS THAN $17.00 PER SHARE
OUR OFFER AND YOUR RIGHT TO WITHDRAW YOUR SHARES EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON OCTOBER 15, 2004, UNLESS THE OFFER IS EXTENDED. WE MAY EXTEND THE
OFFER PERIOD AT ANY TIME.
RSV BANCORP, INC. IS:
o offering to purchase up to 202,000 shares of our common stock in a tender
offer; and
o offering to purchase these shares at a price not greater than $19.00 nor
less than $17.00 per share in cash, without interest.
IF YOU WANT TO TENDER YOUR SHARES INTO OUR OFFER, THEN YOU MUST:
o specify the price between $17.00 and $19.00 at which you are willing to
tender your shares;
o specify the number of shares you want to tender; and
o follow the instructions in this document and the related documents,
including the accompanying letter of transmittal, to submit your shares.
WHEN OUR OFFER EXPIRES:
o we will select the lowest purchase price specified by tendering
stockholders that will allow us to purchase up to 202,000 shares or such
lesser number of shares as are tendered;
o if the number of shares tendered at or below the selected price is not more
than 202,000, we will purchase all these shares at that price; and
o if the number of shares tendered at or below the selected price is more
than 202,000, we will purchase shares at the selected price:
o first from holders of less than 100 shares who tendered all of their
shares at or below the selected price, and
o then, on a pro rata basis from all other stockholders who tendered
shares at or below the selected price.
OUR OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. OUR
OFFER IS, HOWEVER, SUBJECT TO OTHER CONDITIONS DISCUSSED IN SECTION 7.
OUR BOARD OF DIRECTORS HAS APPROVED THIS OFFER. HOWEVER, NEITHER WE NOR ANY
MEMBER OF OUR BOARD OF DIRECTORS NOR THE INFORMATION AGENT MAKES ANY
RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING
YOUR SHARES OR AS TO THE PRICE OR PRICES AT WHICH YOU MAY CHOOSE TO TENDER YOUR
SHARES. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR SHARES AND,
IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH YOUR SHARES
SHOULD BE TENDERED.
This document contains important information about our offer. We urge you to
read it in its entirety.
The Information Agent for this Offer is:
D. F. King & Co., Inc.
The date of this Offer to Purchase is September 14, 2004
IMPORTANT PROCEDURES
IF YOU WANT TO TENDER ALL OR PART OF YOUR SHARES, YOU MUST DO ONE OF THE
FOLLOWING BEFORE THE EXPIRATION DATE:
o if your shares are registered in the name of a broker, dealer, commercial
bank, trust company or other nominee, contact the nominee and have the
nominee tender your shares for you; or
o if you hold certificates in your own name, then (a) complete and sign the
letter of transmittal according to its instructions, and (b) deliver (i)
the letter of transmittal, together with any required signature guarantee,
(ii) the stock certificates representing your shares, and (iii) any other
documents required by the letter of transmittal to Registrar and Transfer
Company, (the "depositary").
IF YOU WANT TO TENDER YOUR SHARES, BUT:
o your stock certificates representing your shares are not immediately
available or they cannot be delivered to the depositary, or
o your other required documents cannot be delivered to the depositary by the
expiration date,
then you can still tender your shares, if you comply with the guaranteed
delivery procedure described in Section 3.
TO TENDER YOUR SHARES YOU MUST FOLLOW THE PROCEDURES DESCRIBED IN (A) THIS
DOCUMENT, (B) THE LETTER OF TRANSMITTAL, AND (C) THE OTHER DOCUMENTS RELATED TO
OUR OFFER, INCLUDING CHOOSING A PRICE AT WHICH YOU WANT TO TENDER YOUR SHARES.
If you wish to maximize the chance that your shares will be purchased by
us, you should check the box next to "Shares tendered at price determined
pursuant to the offer" in the section of the letter of transmittal titled "Price
(In Dollars) Per Share At Which Shares Are Being Tendered." Note that this
--------------
election could result in your shares being purchased at the minimum price of
- --------------------------------------------------------------------------------
$17.00 per share.
- ----------------
If you have any questions or need assistance, you should contact D. F. King
& Co., Inc., (the "information agent") for our offer, at their address and
telephone number on the back page of this document. You may request additional
copies of this document, the letter of transmittal or the notice of guaranteed
delivery from the information agent.
TABLE OF CONTENTS
SECTION PAGE
Summary Term Sheet............................................................ 1
Forward-Looking Statements.................................................... 5
The Offer..................................................................... 6
1. Number of Shares; Price; Priority of Purchase....................... 6
2. Purposes of the Offer; Certain Effects of the Offer................. 9
3. Procedures for Tendering Shares.....................................11
4. Withdrawal Rights...................................................16
5. Purchase of Shares and Payment of Purchase Price....................17
6. Conditional Tender Procedures.......................................18
7. Conditions of Our Offer.............................................19
8. Price Range of Shares; Dividends....................................21
9. Source and Amount of Funds..........................................22
10. Information About Us and the Shares.................................22
11. Interests of Directors and Executive Officers;
Transactions and Arrangements Concerning Shares.................22
12. Effects of Our Offer on the Market for Our Shares;
Registration Under the Exchange Act..............................32
13. Legal Matters; Regulatory Approvals.................................33
14. Extension of Our Offer; Termination; Amendment......................33
15. Federal Income Tax Consequences.....................................34
16. Fees and Expenses...................................................38
17. Miscellaneous.......................................................38
SUMMARY TERM SHEET
We are providing this summary term sheet for your convenience. It
highlights material information in this document. However, you should realize
that it does not describe all of the details of our offer to the same extent
that they are described in the body of this document. We urge you to read this
entire document and the related letter of transmittal carefully because they
contain the full details of our offer. Where helpful, we have included
references to the sections of this document where you will find a more complete
discussion.
WHO IS OFFERING TO PURCHASE MY SHARES?
RSV Bancorp, Inc. ("RSV Bancorp"). We are offering to purchase up to 202,000
shares of our outstanding common stock. See Section 10.
WHAT IS THE PURCHASE PRICE?
The price range for our offer is $17.00 to $19.00.
We are conducting the offer through a procedure commonly called a "modified
Dutch auction." This procedure allows you to choose a price within this price
range at which you are willing to sell your shares to us.
We will look at the prices chosen by stockholders for all of the shares properly
tendered. We will then select the lowest price that will allow us to buy up to
202,000 shares. If a lesser number of shares is tendered, we will select the
price that will allow us to buy all shares that were properly tendered. All
shares we purchase will be purchased at the same price, even if you have chosen
a lower price, but we will not purchase any shares tendered at a price above the
price selected in accordance with these procedures.
If you wish to maximize the chance that your shares will be purchased, you
should check the box next to "Shares tendered at price determined pursuant to
the offer" in the section of the letter of transmittal titled "Price (In
Dollars) Per Share At Which Shares Are Tendered." You should understand that
this election could result in your shares being purchased at the minimum price
of $17.00 per share. See Section 1.
HOW AND WHEN WILL I BE PAID?
If your shares are purchased in our offer, you will be paid the purchase price,
in cash, without interest, promptly after the expiration of the offer period and
the acceptance of the shares for payment. There may be tax consequences to
receiving this payment. See Sections 1, 3, 5 and 15.
1
HOW MANY SHARES WILL RSV BANCORP PURCHASE IN ALL?
We will purchase up to 202,000 shares in our offer, or approximately 30% of our
outstanding common stock. We also reserve the right to purchase additional
shares up to 2% of the outstanding shares, subject to applicable legal
requirements. Our offer is not conditioned on any minimum number of shares being
tendered. See Section 1.
IF I TENDER MY SHARES, HOW MANY OF MY SHARES WILL RSV BANCORP PURCHASE?
All the shares that you tender in our offer may not be purchased, even if they
are tendered at or below the purchase price we select. If more than 202,000
shares are tendered at or below the selected purchase price, we will purchase
shares based on the following order of priority:
o First, we will purchase shares from all holders of "odd lots" of less
-----
than 100 shares who properly tender all of their shares at prices
equal to or below the selected price.
o Second, we will purchase shares from all other stockholders who
------
properly tender shares at prices equal to or below the selected price,
on a pro rata basis, subject to the conditional tender provisions
described in Section 6. As a result, we will purchase the same
percentage of shares from each tendering stockholder in this second
category. We will announce this proration percentage, if it is
necessary, after our offer expires.
As we noted above, we may also choose to purchase an additional 2% of the
outstanding shares, subject to applicable legal rules. See Section 1.
HOW WILL RSV BANCORP PAY FOR THE SHARES?
We would need a maximum of $3,838,000 to purchase 202,000 shares at the highest
price of $19.00. We will use cash on hand and dividends from Mt. Troy Bank to
pay for the shares we purchase in this offer. See Section 9.
HOW LONG DO I HAVE TO TENDER MY SHARES TO RSV BANCORP
You may tender your shares until our offer expires. The offer is scheduled to
expire on October 15, 2004, at 5:00 p.m., New York City Time, but we may choose
to extend our offer at any time. We cannot assure you that we will extend our
offer or, if we extend it, for how long it will be extended. See Sections 1 and
14. If a broker, dealer, commercial bank, trust company or other nominee holds
your shares, it is likely they have an earlier deadline for accepting the offer.
HOW WILL I BE NOTIFIED IF RSV BANCORP EXTENDS THIS OFFER?
If we extend our offer, we will make a public announcement before 9:00 a.m., New
York City Time, on the first business day after the scheduled expiration date.
See Section 14.
2
WHAT ARE THE CONDITIONS TO RSV BANCORP'S OFFER?
Our obligation to accept and pay for your tendered shares is conditioned upon
the satisfaction or waiver of the conditions described in this document. See
Section 7.
HOW DO I TENDER MY SHARES?
To tender your shares, you must complete one of the actions described under
"Important Procedures" on the inside front cover of this document before the
expiration date.
You may also contact the information agent or your broker for assistance. The
contact information for the Information agent is on the back page of this
document.
See Section 3 and the instructions to the letter of transmittal.
ONCE I HAVE TENDERED SHARES IN THE OFFER, CAN I CHANGE MY MIND?
Yes. If you tender your shares and change your mind, you may withdraw your
shares at any time before our offer expires.
In addition, after our offer expires, if we have not accepted for payment the
shares you have tendered to us, you may withdraw your shares at any time after
12:00 midnight, New York City Time, on November 9, 2004. See Section 4.
To withdraw your shares, you must timely deliver a written notice of your
withdrawal to the depositary at the address or facsimile number appearing on the
back page of this document. Your notice of withdrawal must specify (1) your
name, (2) the number of shares to be withdrawn, and (3) the name of the
registered holder of the shares. Some additional requirements apply if the
certificates for the shares to be withdrawn have been delivered to the
depositary. See Section 4.
WHAT DO RSV BANCORP AND ITS BOARD OF DIRECTORS THINK ABOUT THIS OFFER?
Our Board of Directors has approved this offer. However, neither we, our board
of directors, nor the information agent is making any recommendation regarding
whether you should tender or not tender your shares or at what price you should
choose to tender your shares. You must decide whether to tender your shares and,
if so, how many shares to tender and the price or prices at which you will
tender them. You should discuss whether to tender your shares with your broker
or other financial or tax advisor. Our directors and executive officers have
advised us that they do not intend to tender shares in our offer. See Section 2.
3
WHAT IS A RECENT MARKET PRICE OF MY RSV BANCORP SHARES?
Our common stock is traded on the OTC Bulletin Board under the symbol "RSVI."
Prior to July 1, 2004, our common stock had traded under the symbol "RSVB." On
September 8, 2004, the last trading day prior to commencement of our offer, the
closing sale price of our common stock on the OTC Bulletin Board was $17.10. We
urge you to obtain more current market quotations for your shares. For trading
information regarding the shares, you may call D. F. King & Co., Inc., toll free
at (800) 207-3158, See Section 10.
WILL I HAVE TO PAY BROKERAGE COMMISSIONS OR STOCK TRANSFER TAX IF I TENDER MY
SHARES TO RSV BANCORP?
If you are a registered stockholder and tender your shares directly to the
depositary, you will not need to pay any brokerage commissions. If you hold
shares through a broker or bank, however, you should ask your broker or bank to
see if you will be charged a fee to tender your shares. See Section 3.
If you instruct the depositary in the letter of transmittal to make the payment
for the shares to the registered holder, you will not incur any stock transfer
tax. See Section 5.
WHAT ARE THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES IF I TENDER MY SHARES
TO RSV BANCORP?
Generally, you will be subject to United States federal income taxation when you
receive cash from us in exchange for the shares you tender. The cash you receive
will be treated either as:
o a sale or exchange eligible for capital gains treatment; or
o a dividend subject to ordinary income tax rates.
See Section 15.
WHOM DO I CONTACT IF I HAVE QUESTIONS ABOUT RSV BANCORP'S OFFER?
Our information agent can help answer your questions. The information agent is
D. F. King & Co., Inc. Their contact information appears on the back page of
this document.
FOLLOWING THE OFFER, WILL RSV BANCORP CONTINUE AS A PUBLIC COMPANY?
The completion of the offer in accordance with its terms will not cause RSV
Bancorp to cease being subject to the periodic reporting obligations of the
Securities Exchange Act of 1934, as amended. See Section 12.
IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES OF COMMON STOCK?
Stockholders who choose not to tender will own a greater percentage interest in
our outstanding common stock following the consummation of the offer.
4
FORWARD-LOOKING STATEMENTS
This document contains a number of forward-looking statements regarding our
financial condition, results of operations and business. These statements may be
made directly in this document or may be incorporated in this document by
reference to other documents. These statements may also include references to
periods following the completion of our offer or other transactions described in
this document. You can find many of these statements by looking for words such
as "believes," "expects," "anticipates," "estimates," "intends," "plans," "may,"
"will" and "potential" and for similar expressions. Forward-looking statements
involve substantial risks and uncertainties. Some of the factors that may cause
actual results to differ materially from those contemplated by the
forward-looking statements include, but are not limited to, the following
possibilities:
o the timing and occurrence or non-occurrence of events, including the
conditions to our offer, may be subject to circumstances beyond our
control;
o there may be increases in competitive pressure among financial
institutions or from non-financial institutions;
o changes in the interest rate environment may reduce interest margins
or may adversely affect mortgage banking operations;
o changes in deposit flows, loan demand or real estate values may
adversely affect our business;
o changes in accounting principles, policies or guidelines may cause our
financial condition to be perceived differently;
o general economic conditions, either nationally or locally, in the
markets in which we do business, or conditions in securities markets,
the banking industry or the mortgage banking industry, may be less
favorable than we currently anticipate;
o legislation or regulatory changes may adversely affect our business;
o technological changes may be more difficult or expensive than we
anticipate;
o success or consummation of new business initiatives may be more
difficult or expensive than we anticipate; or
o litigation or other matters before regulatory agencies, whether
currently existing or commencing in the future, may delay the
occurrence or non-occurrence of events longer than we anticipate.
All subsequent written and oral forward-looking statements concerning our
offer or other matters addressed in this document and attributable to us or any
person acting on our behalf are qualified by these cautionary statements.
5
THE OFFER
1. NUMBER OF SHARES; PRICE; PRIORITY OF PURCHASE.
GENERAL. On the terms and subject to the conditions of our offer, we will
purchase at a price not greater than $19.00 nor less than $17.00 per share, net
to the seller in cash, without interest, 202,000 shares of our common stock, or
such lesser number of shares as are properly tendered and not properly withdrawn
in accordance with the procedures set forth in Section 4.
The term "expiration date" with respect to our offer means 5:00 p.m., New
York City Time, on October 15, 2004, unless we, in our sole discretion, extend
the period of time during which our offer will remain open. If extended by us,
the term "expiration date" will mean the latest time and date at which our
offer, as extended, will expire. See Section 14 for a description of our right
to extend, delay, terminate or amend our offer.
In accordance with the instructions of the letter of transmittal,
stockholders desiring to tender shares must specify the price or prices, not
greater than $19.00 nor less than $17.00 per share, at which they are willing to
sell their shares. Prices may be specified in increments of $0.25.
Alternatively, stockholders desiring to tender shares can choose not to specify
a price and, instead, specify that they will sell their shares at the purchase
price selected by us for shares properly tendered in our offer. This could
result in the tendering stockholder receiving a price per share as low as
$17.00.
THE GREATER NUMBER OF STOCKHOLDERS WHO ELECT NOT TO SPECIFY A PURCHASE
PRICE WILL INCREASE THE CHANCE THAT THE TENDERING STOCKHOLDER COULD RECEIVE A
PRICE PER SHARE AS LOW AS $17.00.
Promptly following the expiration date, we will select the purchase price
for shares properly tendered and not properly withdrawn, taking into account the
number of shares tendered and the prices specified by tendering stockholders. We
will select the lowest purchase price between $17.00 and $19.00 net per share in
cash, without interest, that will enable us to purchase 202,000 shares, or such
lesser number of shares as are properly tendered.
Shares properly tendered at or below that purchase price and not properly
withdrawn will be purchased at the selected purchase price upon the terms and
conditions of our offer, including the odd lot, proration and conditional tender
provisions described below. If more than 202,000 shares are tendered at or below
the purchase price we select, shares tendered at or below the purchase price
will be subject to proration, except for odd lots. In accordance with the rules
of the SEC, we may, and we reserve the right to, purchase in our offer an
additional amount of shares, not to exceed 2% of our outstanding common stock,
without amending or extending our offer. See Section 14.
All shares we purchase will be purchased at the same price, even if you
have specified a lower price. However, we will not purchase any shares tendered
at a price above the purchase price we select using the procedures described
above.
All shares tendered and not purchased, including shares tendered at prices
above the purchase price we select and shares not purchased because of proration
or the conditional tender procedures, will be returned to you at our expense
promptly following the expiration date.
On the letter of transmittal you can specify the order in which portions of
your shares will be purchased if, as a result of the proration provisions or
otherwise, some but not all of your tendered shares
6
are purchased in our offer. In addition, you can tender different portions of
your shares at different prices by completing separate letters of transmittal
for each price at which you tender shares.
You may withdraw your shares from our offer by following the procedures
described in Section 4.
If we:
o increase or decrease the range of prices to be paid for shares,
o increase the number of shares being sought in our offer by more than
2% of our outstanding common stock, or
o decrease the number of shares being sought in our offer,
then our offer must remain open, or will be extended, until at least ten (10)
business days from, and including, the date that notice of any such change is
first published, sent or given in the manner described in Section 14. For
purposes of our offer, a "business day" means any day other than a Saturday,
Sunday or United States federal holiday and consists of the time period from
12:01 a.m. through 12:00 midnight, New York City Time.
In calculating the number of shares to be accepted for payment pursuant to
the procedures described in this document, we will add the total number of
shares tendered at the minimum price of $17.00 to the shares tendered by
stockholders who have indicated, in the appropriate box in the letter of
transmittal, that they are willing to accept the price determined in our offer.
Accordingly, shares tendered at the price determined in the offer will be
treated the same as shares tendered at $17.00. However, as discussed above,
shares properly tendered and accepted for purchase will all be purchased at the
same price, even if the purchase price we select is higher than the price at
which the shares were tendered.
OUR OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. OUR OFFER IS, HOWEVER, SUBJECT TO OTHER CONDITIONS. SEE SECTION 7.
PRIORITY OF PURCHASES. Upon the terms and conditions of our offer, if
202,000 or fewer shares are properly tendered at prices equal to or below the
purchase price and not properly withdrawn, we will purchase all properly
tendered shares at the purchase price.
Upon the terms and conditions of our offer, if more than 202,000 shares are
properly tendered at prices equal to or below the purchase price and not
properly withdrawn, we will purchase properly tendered shares in the following
order:
o First, all shares properly tendered and not properly withdrawn by any
-----
"odd lot holder" (as defined below) who tenders all shares owned
(beneficially or of record) by such odd lot holder at a price equal to
or below the purchase price (conditional tenders and tenders of less
than all the shares owned will not qualify for this preference); and
completes the section entitled "Odd Lots" in the letter of transmittal
and, if applicable, in the notice of guaranteed delivery.
o Second, after the purchase of all the shares properly tendered by odd
------
lot holders and subject to the conditional tender procedures described
in Section 6, we will purchase, on a pro rata basis with appropriate
adjustments to avoid purchases of fractional shares (as
7
described below), all other shares properly tendered at prices equal
to or below the purchase price, and
o Third, only if necessary to purchase 202,000 shares, shares
-----
conditionally tendered (for which the condition was not initially
satisfied) at or below the purchase price, will, to the extent
feasible, be selected for purchase by random lot. To be eligible for
purchase by random lot, stockholders whose shares are conditionally
tendered must have tendered all of their shares.
As a result, all the shares that you tender in our offer may not be
purchased, even if they are tendered at prices equal to or below the purchase
price. This will occur if we receive more than 202,000 properly tendered shares
at prices equal to or below the purchase price.
As we noted above, we may elect to purchase more than 202,000 shares in our
offer, subject to applicable law. If we do so, the preceding provisions will
apply to the greater number of shares.
ODD LOTS. For purposes of our offer, the term "odd lots" means all shares
properly tendered before the expiration date at prices equal to or below the
purchase price and not properly withdrawn by any person, referred to as an "odd
lot holder," who owns, beneficially or of record, a total of fewer than 100
shares (not as a result of any proration) and certifies to that fact in the "Odd
Lots" box on the letter of transmittal and, if applicable, on the notice of
guaranteed delivery. As set forth above, odd lots will be accepted for payment
before proration, if any, of the purchase of other tendered shares. To qualify
for this preference, an odd lot holder must tender all shares owned,
beneficially or of record, by the odd lot holder in accordance with the
procedures described in Section 3.
This preference is not available to partial tenders or to beneficial or
record holders of a total of 100 or more shares, even if these holders have
separate accounts or certificates representing fewer than 100 shares. This
preference also is not available to record holders who become odd lot holders as
result of proration, as discussed below.
Any odd lot holder wishing to tender all its shares pursuant to our offer
should complete the section entitled "Odd Lots" in the letter of transmittal
and, if applicable, in the notice of guaranteed delivery.
PRORATION. If proration of tendered shares is required, we will determine
the proration percentage promptly following the expiration date. Subject to the
conditional tender procedures described in Section 6, proration for each
stockholder tendering shares, other than odd lot holders, will be based on the
ratio of the number of shares properly tendered and not properly withdrawn by
the stockholder to the total number of shares properly tendered and not properly
withdrawn by all stockholders, other than odd lot holders, at or below the
purchase price selected by us.
Because of the potential difficulty in determining the number of shares
properly tendered and not properly withdrawn, including shares tendered by
guaranteed delivery procedures as described in Section 3 and because of the odd
lot procedures described above and the conditional tender procedures described
in Section 6, we do not expect that we will be able to announce the final
proration percentage or commence payment for any shares purchased under our
offer until seven (7) to ten (10) business days after the expiration date. The
preliminary results of any proration will be announced by press release promptly
after the expiration date. Stockholders may obtain preliminary proration
information from the information agent and may be able to obtain this
information from their brokers.
8
As described in Section 15, the number of shares that we will purchase from
a stockholder under our offer may affect the United States federal income tax
consequences to that stockholder and, therefore, may be relevant to a
stockholder's decision whether or not to tender shares. The letter of
transmittal affords each stockholder the opportunity to designate the order of
priority in which shares are to be purchased in the event of proration, should a
stockholder decide to do so for federal income tax reasons. In addition,
stockholders may choose to submit a "conditional tender" under the procedures
discussed in Section 6 in order to structure their tender for federal income tax
reasons.
2. PURPOSES OF THE OFFER; CERTAIN EFFECTS OF THE OFFER.
We believe that the purchase of shares is an attractive use of a portion of
our available capital on behalf of our stockholders and is consistent with our
long-term goal of increasing stockholder value. We believe we have adequate
sources of capital to both complete the share repurchase and continue with our
regular pursuit of business opportunities.
The offer is designed to restructure our balance sheet in order to increase
return on equity and earnings per share by reducing the amount of equity and
shares outstanding. Based upon the current market price of our shares, we
believe that the purchase of shares is an attractive use of funds. Following the
purchase of the shares, we believe funds provided by earnings, combined with
other sources of liquidity, will be adequate to meet our funding needs for the
foreseeable future. Upon completion of the offer, we expect that RSV Bancorp and
our wholly owned subsidiary bank, Mt. Troy Bank, will continue to maintain the
highest regulatory standards for capital.
Since our initial public offering, our capital base has not only exceeded
all applicable regulatory standards but also the amount of capital needed to
support our banking business. Upon completion of our initial public offering in
April, 2002, we had an equity to assets ratio of 21.63%, which was well in
excess of industry standards, regulatory requirements and an amount necessary to
execute our long term business plan. Since the time we went public, our board of
directors has continuously sought ways to enhance our value and utilize our
excess capital, focusing on a combination of regular cash dividends and stock
repurchases. Since it became legally permissible for us to repurchase our
shares, we have repurchased 83,766 shares, or 11.06% of the shares issued in our
initial public offering, at a total cost of $1.5 million. As of June 30, 2004,
our equity to assets ratio stood at 15.24%.
In setting the price range for our offer, our board of directors considered
the funds available held by RSV Bancorp, the available capital that could be
distributed by Mt. Troy Bank to RSV Bancorp, the resulting regulatory capital
levels at Mt. Troy Bank, and the increase in pro forma earnings per share and
decrease in pro forma book value per share that would result from the completion
of the offer. The goal of our board of directors was to structure the size and
price of our offer so that it would be appealing to stockholders who may be
interested in selling their shares and beneficial to stockholders who may be
interested in retaining their shares.
We believe the offer may be attractive from the perspective of our
stockholders for the following reasons:
o The offer gives stockholders liquidity by giving them opportunity to
determine the price or prices, not greater than $19.00 per share or
less than $17.00 per share, at which they are willing to sell all or a
portion of their shares and, if those shares are purchased in our
offer, to sell their shares for cash without the usual transaction
costs associated with open-market sales;
9
o The offer provides stockholders with the opportunity to sell their
shares for a price that may be greater than market prices prevailing
prior to the announcement of the offer.
o Any odd lot holders whose shares are purchased pursuant to the offer
not only will avoid the payment of brokerage commissions for their
sale of shares directly to us, but also will avoid any applicable odd
lot discounts payable on sales of odd lots.
o To the extent the purchase of shares in the offer results in a
reduction in the number of stockholders of record, the costs to us for
services to stockholders will be reduced.
o The offer allows stockholders to sell a portion of their shares while
retaining a continuing ownership interest in RSV Bancorp, subject to
the attendant risk and rewards associated with owning equity
securities.
o Stockholders who do not tender their shares pursuant to the offer will
realize a proportionate increase in their relative ownership interest
in RSV Bancorp and, thus, in RSV Bancorp's future earnings and assets,
subject to our right to issue additional shares and other equity
securities in the future.
The offer also presents some potential risks and disadvantages to us and
our continuing stockholders:
o The offer will result in a decrease in the amount of cash held by RSV
Bancorp and Mt. Troy Bank. However, after completion of the offer, we
expect Mt. Troy Bank to continue to maintain the highest regulatory
capital ranking.
o The offer will reduce our "public float" (the number of shares owned
by outside stockholders and available for trading in the securities
markets). This may result in lower stock prices or reduced liquidity
in the trading markets for our common stock in the future.
We believe that the modified "Dutch auction" tender offer set forth herein
represents a mechanism to provide most of our stockholders with the opportunity
to tender all or a portion of their shares and, thereby, receive a return of
cash if they so elect. This format of repurchase provides a method for
stockholders not participating to increase their relative percentage interest in
us and our future operations at no additional cost. As a result, the Board of
Directors believes that investing in our own shares in this manner is an
attractive use of surplus and an efficient means to provide value to our
stockholders. The tender offer also provides stockholders (particularly those
who, because of the size of their stockholdings, might not be able to sell their
shares without potential disruption to the share price) with an opportunity to
obtain liquidity with respect to their shares without potential disruption to
the share price and the usual transaction costs associated with market sales.
The offer will enable stockholders to sell a portion of their shares while
retaining a continuing equity interest in us, if they so desire. The offer may
provide stockholders who are considering a sale of all or a portion of their
shares the opportunity to determine the price or prices (not greater than $19.00
nor less than $17.00 per share) at which they are willing to sell their shares
and, if any such shares are purchased pursuant to the offer, to sell those
shares for cash without the usual transaction costs associated with open-market
sales. In addition, odd lot holders whose shares are purchased pursuant to the
offer will avoid the payment of brokerage commissions and will avoid any
applicable odd lot discounts in a sale of
10
such holder's shares. For stockholders who do not tender, there is no assurance
that the price of the stock will not trade below the price being offered
pursuant to the offer, nor is there any assurance that there will be an active
public market in which to trade your shares of common stock. For stockholders
who do tender, the trading price of stock may increase as a result of the offer
or an unexpected acquisition at a premium could occur in the future although we
are restricted from entering into any agreement or having discussions with any
party regarding an acquisition until at least three years after the date of Mt.
Troy Bank's conversion from mutual to stock form.
NEITHER RSV BANCORP, OUR BOARD OF DIRECTORS, OUR INFORMATION AGENT, OR OUR
FINANCIAL ADVISOR MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS TO WHETHER TO
TENDER OR NOT TO TENDER ANY SHARES OR AS TO THE PRICE OR PRICES AT WHICH
STOCKHOLDERS MAY CHOOSE TO TENDER THEIR SHARES. WE HAVE NOT AUTHORIZED ANY
PERSON TO MAKE ANY SUCH RECOMMENDATION. STOCKHOLDERS SHOULD CAREFULLY EVALUATE
ALL INFORMATION IN OUR OFFER, CONSULT THEIR OWN INVESTMENT AND TAX ADVISORS, AND
MAKE THEIR OWN DECISIONS ABOUT WHETHER TO TENDER SHARES AND, IF SO, HOW MANY
SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH TO TENDER.
3. PROCEDURES FOR TENDERING SHARES.
PROPER TENDER OF SHARES. For your shares to be properly tendered, either
(1) or (2) below must occur:
(1) The depositary must receive all of the following before or on the
expiration date at the depositary's address on the back page of this
document:
(A) the certificates for the shares;
(B) a properly completed and executed letter of transmittal or a
manually executed facsimile of it, including any required
signature guarantees; and
(C) any other documents required by the letter of transmittal.
(2) You must comply with the guaranteed delivery procedure set forth
below.
In accordance with Instruction 5 of the letter of transmittal, if you want
to tender your shares you must properly complete the pricing section of the
letter of transmittal, titled "Price (In Dollars) Per Share At Which Shares Are
Being Tendered":
o If you wish to maximize the chance that your shares will be purchased
at the purchase price determined by us, you should check the box in
this section of the letter of transmittal next to "Shares tendered at
price determined pursuant to the offer." This means that you will
accept the purchase price selected by us in accordance with the terms
of our offer. Note that this election could result in your shares
-------------------------------------------------------
being purchased at the minimum price of $17.00 per share.
--------------------------------------------------------
o If you wish to indicate a specific price (in multiples of $0.25) at
which your shares are being tendered, you must check ONE box in this
section. You should be aware that this
-----------------------------
11
election could mean that none of your shares will be purchased if you
----------------------------------------------------------------------
choose a price that is higher than the purchase price we eventually
----------------------------------------------------------------------
select after the expiration date.
---------------------------------
If you want to tender portions of your shares at different prices you must
complete a separate letter of transmittal for each portion of your shares that
you want to tender at a different price. However, the same shares cannot be
tendered (unless properly withdrawn previously in accordance with the procedures
described in Section 4) at more than one price. To tender shares properly, one
and only one price box must be checked in the "Price (In Dollars) Per Share At
Which Shares Are Being Tendered" section on each letter of transmittal.
If you tender your shares directly to the depositary, you will not need to
pay any brokerage commissions. If you hold shares through a broker or bank,
however, you should ask your broker or bank to see if you will be charged a fee
to tender your shares through the broker or bank.
ENDORSEMENTS AND SIGNATURE GUARANTEES. Depending on how your shares are
registered and to whom you want payments or deliveries made, you may need to
have your certificates endorsed and the signatures on the letter of transmittal
and endorsement guaranteed by an "eligible guarantor institution," as such term
is defined in Rule 17Ad-15 under the Exchange Act. No endorsement or signature
guarantee is required if:
(A) the letter of transmittal is signed by the registered holder of the
shares tendered exactly as the name of the registered holder appears
on the certificate(s) for the shares and payment and delivery are to
be made directly to the holder, unless the holder has completed either
the box captioned "Special Delivery Instructions" or the box captioned
"Special Payment Instructions" on the letter of transmittal; or
(B) shares are tendered for the account of a bank, broker, dealer, credit
union, savings association or other entity that is a member in good
standing of the Securities Transfer Agents Medallion Program or a
bank, broker, dealer, credit union, savings association or other
entity that is an eligible guarantor institution.
In addition, odd lot holders who tender all shares must complete the
section captioned "Odd Lots" in the letter of transmittal and, if applicable, in
the notice of guaranteed delivery, to qualify for the preferential treatment
available to odd lot holders as set forth in Section 1. See Instruction 9 of the
letter of transmittal.
On the other hand, if a certificate for shares is registered in the name of
a person other than the person executing a letter of transmittal or you are
completing either the box captioned "Special Delivery Instructions" or the box
captioned "Special Payment Instructions" on the letter of transmittal, then
(A) your certificates must be endorsed or accompanied by an appropriate
stock power, in either case signed exactly as the name of the
registered holder appears on the certificates; and
(B) the signature on (1) the letter of tranmittal, and (2) on your stock
certificates or stock power must be guaranteed by an eligible
guarantor institution.
METHOD OF DELIVERY. Payment for shares tendered and accepted for payment
under our offer will be made only after timely receipt by the depositary of all
of the following:
12
(1) certificates for such shares,
(2) any of a properly completed and duly executed letter of transmittal or
a manually signed facsimile thereof, and
(3) any other documents required by the letter of transmittal.
THE METHOD OF DELIVERING ALL DOCUMENTS, INCLUDING CERTIFICATES FOR SHARES,
THE LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT YOUR ELECTION
AND RISK. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED
AND PROPERLY INSURED, IS RECOMMENDED.
ALL DELIVERIES IN CONNECTION WITH OUR OFFER, INCLUDING A LETTER OF
TRANSMITTAL AND CERTIFICATES FOR SHARES, MUST BE MADE TO THE DEPOSITARY AND NOT
RSV BANCORP OR THE INFORMATION AGENT. ANY DOCUMENTS DELIVERED TO US OR THE
INFORMATION AGENT WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT
BE DEEMED TO BE PROPERLY TENDERED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY DELIVERY. The depositary will establish an account with respect
to the shares at the book-entry transfer facility for purposes of our offer
within two business days after the date of this document. Any financial
institution that is a participant in the system of the book-entry transfer
facility may make book-entry delivery of shares by causing the book-entry
transfer facility to transfer the shares into the depositary's account in
accordance with the depositary's procedure for the transfer. Even though
delivery of shares may be effected through book-entry transfer into the
depositary's account at the book-entry transfer facility, either (1) or (2)
below must occur for a valid tender:
(1) A properly completed and duly executed letter of transmittal or a
manually signed copy thereof, or an agent's message, as defined below,
together with any required signature guarantees and any other required
documents, must, in any case, be transmitted to and received by the
depositary at its address set forth on the back cover of this offer on
or prior to the expiration date.
(2) You must comply with the guaranteed delivery procedures set forth
below.
Delivery of the letter of transmittal (or other required documentation) to
the book-entry transfer facility does not constitute delivery to the depositary.
The term "agent's message" means a message transmitted by the book-entry
transfer facility to, and received by, the depositary and forming a part of a
book-entry confirmation, which states that the book-entry transfer facility has
received an express acknowledgement from the participant in the book-entry
transfer facility tendering the shares, that the participant has received and
agrees to be bound by the terms of the letter of transmittal and that we may
enforce the agreement against the participant.
GUARANTEED DELIVERY. If you want to tender your shares, but your stock
certificates are not immediately available or cannot be delivered to the
depositary before the expiration date, or if time will not
13
permit all required documents to reach the depositary before the expiration
date, you can still tender your shares, if all of the following conditions are
satisfied:
o the tender is made by or through an eligible guarantor institution;
o the depositary receives by hand, mail, overnight courier or facsimile
transmission, before the expiration date, a properly completed and
duly executed notice of guaranteed delivery in the form we have
provided with this document, specifying the price at which shares are
being tendered, including (where required) a signature guarantee by an
eligible guarantor institution in the form set forth in the notice of
guaranteed delivery; and
o all of the following are received by the depositary within three
trading days after the date of receipt by the depositary of the notice
of guaranteed delivery:
(a) the certificates for the shares;
(b) a properly completed and executed letter of transmittal or a
manually executed facsimile of it, including any required
signature guarantees; and
(c) any other documents required by the letter of transmittal.
EMPLOYEE BENEFIT PLANS. We sponsor three stock-based employee benefit plans
and a 401(k) savings plan (collectively, the "Stock Plans"), all of which hold
shares or options to acquire shares of our common stock.
Decisions as to whether to tender ESOP shares will be made by the ESOP
trustees, consisting of our non-employee directors, subject to the terms of the
plan and ERISA. The ESOP trustees have informed us that as of the date hereof
they do not intend to tender any shares held in the ESOP Plan. Participants in
the 401(k) plan whose accounts hold shares of our common stock are entitled to
direct the Plan Administrator as to whether to tender such participant's shares.
In the absence of any such direction, the Plan Administrator will not tender
shares of our common stock in the offer.
We are not offering, as part of the offer, to purchase any of the options
or restricted shares outstanding or held under the Stock Plans or the ESOP and
tenders of such options or shares will not be accepted. In no event are any
options or shares held under the Stock Plans or ESOP to be delivered to the
depositary in connection with a tender of shares hereunder. An exercise of an
option cannot be revoked even if shares received upon the exercise thereof and
tendered in the offer are not purchased in the offer for any reason.
DETERMINATION OF VALIDITY; REJECTION OF SHARES; WAIVER OF DEFECTS; NO
OBLIGATION TO GIVE NOTICE OF DEFECTS. All questions as to the number of shares
to be accepted, the price to be paid for shares to be accepted and the validity,
form, eligibility (including time of receipt) and acceptance for payment of any
tender of shares will be determined by us, in our sole and absolute discretion,
and our determination will be final and binding on all parties. We reserve the
absolute right to reject any or all tenders of any shares that we determine are
not in proper form or the acceptance for payment of or payment for which we
determine may be unlawful. We also reserve the absolute right to waive any
defect or irregularity in any tender with respect to any particular shares or
any particular stockholder and our interpretation of the terms of our offer will
be final and binding on all parties. No tender of shares will be deemed to have
been
14
properly made until all defects or irregularities have been cured by the
tendering stockholder or waived by us. Unless waived, any defects and
irregularities in connection with tenders must be cured within the time period,
if any, we determine. Neither we, nor any of the depositary, the information
agent or any other person will be under any duty to give notification of any
defects or irregularities in any tender or incur any liability for failure to
give any such notification.
Although we reserve the absolute right to waive any defect or irregularity
in any tender with respect to any particular shares or any particular
stockholder, we do not have the right to waive any conditions of the offer to
any particular stockholder, unless waived with respect to all stockholders.
YOUR REPRESENTATION AND WARRANTY; OUR ACCEPTANCE CONSTITUTES AN AGREEMENT.
A tender of shares under any of the procedures described above will constitute
your acceptance of the terms and conditions of our offer, as well as your
representation and warranty to us that:
o you have a "net long position" in the shares or equivalent securities
at least equal to the shares tendered within the meaning of Rule 14e-4
promulgated by the SEC under the Exchange Act; and
o the tender of shares complies with Rule 14e-4.
It is a violation of Rule 14e-4 for a person, directly or indirectly, to
tender shares for that person's own account unless, at the time of tender and at
the end of the proration period, the person so tendering
o has a net long position equal to or greater than the amount tendered
in the subject securities or securities immediately convertible into,
or exchangeable or exercisable for, the subject securities; and
o will deliver or cause to be delivered the shares in accordance with
the terms of the tender offer.
Rule 14e-4 provides a similar restriction applicable to the tender or
guarantee of a tender on behalf of another person.
Our acceptance for payment of shares tendered under our offer will
constitute a binding agreement between you and RSV Bancorp upon the terms and
conditions of our offer described in this and related documents.
RETURN OF UNPURCHASED SHARES. If any tendered shares are not purchased or
are properly withdrawn, or if less than all shares evidenced by a stockholder's
certificates are tendered, certificates for unpurchased shares will be returned
promptly after the expiration or termination of our offer or the proper
withdrawal of the shares, as applicable. Shares will be returned without expense
to the stockholder.
FEDERAL BACKUP WITHHOLDING TAX. Under the United States federal backup
withholding tax rules, 28% of the gross proceeds payable to a stockholder or
other payee in the tender offer must be withheld and remitted to the United
States Treasury, unless the stockholder or other payee provides such person's
taxpayer identification number (employer identification number or social
security number) to the depositary and certifies under penalties of perjury that
such number is correct or otherwise establishes an exemption. If the depositary
is not provided with the correct taxpayer identification number or another
adequate basis for exemption, the holder may be subject to certain penalties
imposed by the Internal Revenue Service.
15
Therefore, each tendering stockholder should complete and sign the substitute
Form W-9 included as part of the letter of transmittal in order to provide the
information and certification necessary to avoid backup withholding, unless such
stockholder otherwise establishes to the satisfaction of the depositary that the
stockholder is not subject to backup withholding.
Certain stockholders (including, among others, all corporations and certain
foreign stockholders (in addition to foreign corporations)) are not subject to
these backup withholding rules. In order for a foreign stockholder to qualify as
an exempt recipient, that stockholder must submit an IRS Form W-8 or a
Substitute Form W-8, signed under penalties of perjury, attesting to that
stockholder's exempt status. The applicable form can be obtained from the
depositary. See Instruction 10 of the letter of transmittal.
TO PREVENT FEDERAL BACKUP WITHHOLDING TAX EQUAL TO 28% OF THE GROSS
PAYMENTS MADE TO STOCKHOLDERS FOR SHARES PURCHASED UNDER OUR OFFER, EACH
STOCKHOLDER WHO DOES NOT OTHERWISE ESTABLISH AN EXEMPTION FROM SUCH WITHHOLDING
MUST PROVIDE THE DEPOSITARY WITH THE STOCKHOLDER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER AND PROVIDE OTHER INFORMATION BY COMPLETING THE SUBSTITUTE
FORM W-9 INCLUDED WITH THE LETTER OF TRANSMITTAL.
For a discussion of United States federal income tax consequences to
tendering stockholders, see Section 15.
LOST OR DESTROYED CERTIFICATES. If your certificate for part or all of your
shares has been lost, stolen, misplaced or destroyed, you should contact
Registrar & Transfer Company, the transfer agent for our shares, at (800)
368-5948 for instructions as to obtaining an affidavit of loss. The affidavit of
loss will then be required to be submitted together with the letter of
transmittal in order to receive payment for shares that are tendered and
accepted for payment. A bond may be required to be posted by you to secure
against the risk that the certificates may be subsequently recirculated. You are
urged to contact Registrar and Transfer Company immediately in order to receive
further instructions, to permit timely processing of this documentation and for
a determination as to whether you will need to post a bond. See Instruction 13
of the letter of transmittal.
4. WITHDRAWAL RIGHTS.
Shares tendered may be withdrawn at any time before the expiration of the
offer and, unless accepted for payment by us after the expiration of the offer,
may also be withdrawn at any time after 12:00 midnight, New York City Time, on
November 9, 2004. Except as otherwise provided in this Section 4, tenders of
shares are irrevocable.
WITHDRAWAL OF SHARES HELD IN PHYSICAL FORM. For a withdrawal to be
effective, a written notice of withdrawal must be timely received by the
depositary at its address or facsimile number appearing on the back page of this
document. Any notice of withdrawal must specify the name of the tendering
stockholder, the number of shares to be withdrawn and the name of the registered
holder of the shares. If the certificates for shares to be withdrawn have been
delivered or otherwise identified to the depositary, then, before the release of
such certificates, the serial numbers shown on such certificates must be
submitted to the depositary and the signature(s) on the notice of withdrawal
must be guaranteed by an eligible guarantor institution, unless the shares have
been tendered for the account of an eligible guarantor institution.
WITHDRAWAL OF SHARES HELD WITH THE BOOK-ENTRY TRANSFER FACILITY. For a
withdrawal to be
16
effective, a holder of shares held with the book-entry transfer facility must:
(1) call his or her broker and instruct the broker to withdraw the tender of
shares by debiting the depositary's account at the book-entry transfer facility
for all shares to be withdrawn; and (2) instruct the broker to provide a
written, telegraphic or facsimile transmission notice of withdrawal to the
depositary on or before the expiration date. The notice of withdrawal shall
contain (a) the name of the person who tendered the shares; (b) a description of
the shares to be withdrawn; and (c) if the shares are held by a new beneficial
owner, evidence satisfactory to us that the person withdrawing the tender has
succeeded to the beneficial ownership of the shares. A purported notice of
withdrawal that lacks any of the required information will not be an effective
withdrawal of a tender previously made.
All questions as to the form and validity (including the time of receipt)
of any notice of withdrawal will be determined by us, and our determination will
be final and binding. Neither we, nor any of the depositary, the information
agent or any other person will be under any duty to give notification of any
defects or irregularities in any notice of withdrawal or incur any liability for
failure to give any such notification.
Withdrawals may not be rescinded, and any shares properly withdrawn will
thereafter be deemed not properly tendered for purposes of our offer unless the
withdrawn shares are properly re-tendered before the expiration date by
following one of the procedures described in Section 3.
If we extend our offer, if we are delayed in our purchase of shares or are
unable to purchase shares under our offer for any reason, then, without
prejudice to our rights under our offer, the depositary may, subject to
applicable law, retain tendered shares on our behalf, and such shares may not be
withdrawn except to the extent tendering stockholders are entitled to withdrawal
rights as described in this Section 3.
Our reservation of the right to retain tendered shares we have accepted for
purchase is limited by Rule 13e-4(f)(5) promulgated under the Exchange Act,
which requires that we must pay the consideration offered or return the shares
tendered promptly after termination or withdrawal of our offer.
5. PURCHASE OF SHARES AND PAYMENT OF PURCHASE PRICE.
Upon the terms and conditions of our offer, promptly following the
expiration date, we will:
o select the purchase price we will pay for shares properly tendered and
not properly withdrawn, taking into account the number of shares so
tendered and the prices specified by tendering stockholders; and
o accept for payment and pay for, and thereby purchase, shares properly
tendered at prices equal to or below the purchase price we select and
not properly withdrawn.
For purposes of our offer, we will be deemed to have accepted for payment
and therefore purchased shares that are properly tendered at or below the
purchase price and not properly withdrawn, subject to the odd lot priority,
conditional tender and proration provisions of our offer, only when, as and if
we give oral or written notice to the depositary of our acceptance of the shares
for payment.
Upon the terms and conditions of our offer, promptly after the expiration
date, we will accept for payment and pay a single per share purchase price for
202,000 shares, subject to increase or decrease as provided in Section 1 and
Section 14 if properly tendered and not properly withdrawn, or such lesser
17
number of shares as are properly tendered and not properly withdrawn, at prices
between $17.00 and $19.00 per share.
We will pay for shares purchased under our offer by depositing the
aggregate purchase price for the shares with the depositary, which will act as
agent for tendering stockholders for the purpose of receiving payment from us
and transmitting payment to the tendering stockholders.
In the event of proration, we will determine the proration percentage and
pay for those tendered shares accepted for payment promptly after the expiration
date. However, we do not expect to be able to announce the final results of any
proration or to be able to commence payment for shares purchased until
approximately seven (7) to ten (10) business days after the expiration date.
We will not pay interest on the purchase price regardless of any delay in
making such payment. In addition, if certain events occur, we may not be
obligated to purchase shares in our offer. See the conditions to our offer in
Section 7
We will pay all stock transfer taxes, if any, payable on the transfer to us
of shares purchased under our offer. If, however, (a) payment of the purchase
price is to be made to any person other than the registered holder, (b) shares
not tendered or rejected for purchase are to be registered in the name of any
person other than the registered holder, or (c) certificates representing
tendered shares are registered in the name of any person other than the person
signing the letter of transmittal, the amount of all stock transfer taxes, if
any (whether imposed on the registered holder the other person or otherwise),
payable on account of the transfer to the other person, will be deducted from
the purchase price unless satisfactory evidence of the payment of the stock
transfer taxes, or exemption therefrom, is submitted. See Instruction 7 of the
letter of transmittal.
ANY TENDERING STOCKHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY, SIGN
AND RETURN TO THE DEPOSITARY THE SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF
TRANSMITTAL MAY BE SUBJECT TO FEDERAL INCOME BACKUP WITHHOLDING TAX OF 28% OF
THE GROSS PROCEEDS PAID TO THE STOCKHOLDER OR OTHER PAYEE UNDER OUR OFFER. SEE
SECTION 3. ALSO SEE SECTION 15 REGARDING ADDITIONAL UNITED STATES FEDERAL INCOME
TAX CONSEQUENCES.
6. CONDITIONAL TENDER PROCEDURES.
Under certain circumstances and subject to the exceptions for odd lot
holders described in Section 1, we may prorate the number of shares purchased
pursuant to our offer. As discussed in Section 15 the number of shares to be
purchased from a particular stockholder may affect the tax treatment of the
purchase to the stockholder and the stockholder's decision whether to tender.
The conditional tender alternative is made available so that a stockholder may
seek to structure the purchase of shares pursuant to our offer in such a manner
that the purchase will be treated as a sale of such shares by the stockholder,
rather than the payment of a dividend to the stockholder, for federal income tax
purposes. Accordingly, a stockholder may tender shares subject to the condition
that all or a specified minimum number of the stockholders shares tendered
pursuant to a letter of transmittal or notice of guaranteed delivery must be
purchased if any of the stockholder's tendered shares are purchased. If you are
an odd lot holder and you tender all of your shares, you cannot conditionally
tender because your shares will not be subject to proration. EACH STOCKHOLDER IS
URGED TO CONSULT WITH HIS OR HER OWN TAX ADVISOR.
18
If you wish to make a conditional tender you must indicate this in the box
captioned "Conditional Tender" in the letter of transmittal or, if applicable,
the notice of guaranteed delivery. In this box in the letter of transmittal or
the notice of guaranteed delivery, you must calculate and appropriately indicate
the minimum number of shares that must be purchased if any are to be purchased.
After our offer expires, if greater than 202,000 shares are properly tendered
and not properly withdrawn and we must prorate our acceptance of and payment for
tendered shares, we will calculate a preliminary proration percentage based upon
all shares properly tendered, conditionally or unconditionally. If the effect of
this preliminary proration would be to reduce the number of shares to be
purchased from any stockholder below the minimum number specified by that
stockholder, the conditional tender will automatically be regarded as withdrawn,
unless chosen by lot for reinstatement as discussed in the next paragraph.
After giving effect to these withdrawals, we will accept the remaining
shares properly tendered, conditionally or unconditionally, on a pro rata basis,
if necessary. If we are able to purchase all of the remaining tendered shares
and the number that we would purchase would be below 202,000, then, to the
extent feasible, we will select enough of the conditional tenders that would
otherwise have been deemed withdrawn to permit us to purchase 202,000 shares. In
selecting among these conditional tenders, we will select by random lot and will
select only from stockholders who tendered all of their shares. Upon selection
by lot, if any, we will limit our purchase in each case to the designated
minimum number of shares to be purchased.
All shares tendered by a stockholder subject to a conditional tender
pursuant to the letter of transmittal or notice of guaranteed delivery, regarded
as withdrawn as a result of proration and not eventually purchased will be
returned promptly after the expiration date without any expense to the
stockholder.
7. CONDITIONS OF OUR OFFER.
Notwithstanding any other provision of our offer, we will not be required
to accept for payment, purchase or pay for any shares tendered, and may
terminate or amend our offer or may postpone the acceptance for payment of, or
the purchase of and the payment for shares tendered, subject to the rules
promulgated by the SEC under the Exchange Act, if, at any time on or after
September 14, 2004 and before the expiration of our offer, any of the following
events have occurred:
o there has been threatened, instituted or pending any action or
proceeding by any government or governmental, regulatory or
administrative agency, authority or tribunal or any other person,
domestic or foreign, before any court, authority, agency or tribunal
that directly or indirectly challenges the making of our offer, the
acquisition of some or all of the shares under our offer or otherwise
relates in any manner to our offer, including the other conditions to
our offer;
o there has been any action threatened, pending or taken, or approval
withheld, or any statute, rule, regulation, judgment, order or
injunction threatened, proposed, sought, promulgated, enacted,
entered, amended, enforced or deemed to be applicable to our offer or
to us or any of our subsidiaries, by any court or any authority,
agency or tribunal that, in our reasonable judgment, would or might
directly or indirectly,
o make the acceptance for payment of, or payment for, some or all
of the shares illegal or otherwise restrict or prohibit
completion of our offer; or
19
o delay or restrict our ability, or render us unable, to accept for
payment or pay for some or all of the shares;
o there has occurred any of the following:
o any general suspension of trading in, or limitation on prices
for, securities on any national securities exchange or in the
over-the-counter market in the United States;
o the declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States;
o the commencement of a war, armed hostilities or other
international or national calamity directly or indirectly
involving the United States or any of its territories or, in the
case of an existing armed hostility or other international or
national calamity at the time of our offer, a material escalation
thereof;
o any limitation (whether or not mandatory) by any governmental,
regulatory or administrative agency or authority on, or any
event, or any disruption or adverse change in the financial or
capital markets generally or the market for loan syndications in
particular, that, in our reasonable judgment, might affect, the
extension of credit by banks or other lending institutions in the
United States;
o any significant decrease in the market price of our common stock
or any change in the general political, market, economic or
financial conditions in the United States or abroad that could,
in our reasonable judgment, have a material adverse effect on our
business, operations or prospects or the trading of our common
stock; or
o any significant or material change or changes in the business,
financial condition, assets, income, operations, prospects or
stock ownership of us or our subsidiaries that is or may be
material and adverse to us or our subsidiaries.
In addition, we may amend or terminate the offer, and will not be required
to accept for purchase any shares tendered if, in our good faith reasonable
judgment, any purchase of shares under the offer could result in the offer being
considered a "going private transaction" under Rule 13e-3 of the Securities
Exchange Act of 1934, that is, if our purchase of shares pursuant to this offer
would result in our common stock being held of record by fewer than 300 persons.
As of September 8, 2004, there were approximately 350 record holders of our
shares.
The conditions to our offer are for our sole benefit and may be asserted by
us regardless of the circumstances (including any action or inaction by us)
giving rise to any such condition and, where permissible, may be waived by us,
in whole or in part at any time up until the expiration of our offer in our sole
discretion. Our failure at any time to exercise any of the foregoing rights
shall not be deemed a waiver of any right, and each right shall be deemed an
ongoing right which may be asserted at any time up until the expiration of our
offer. Any determination or judgment by us concerning the events described above
will be final and binding on all parties.
20
Upon the occurrence of one or more of the aforementioned conditions not
otherwise waived by us, we will notify stockholders as promptly as possible of
the condition and whether we will terminate or amend the offer, subject to the
rules promulgated by the SEC under the Exchange Act.
8. PRICE RANGE OF SHARES; DIVIDENDS.
Our common stock is traded on the OTC Bulletin Board under the trading
symbol "RSVI". Effective July 1, 2004, we changed our name from Reserve Bancorp,
Inc. to RSV Bancorp, Inc. and in connection with that name change our symbol was
changed from "RSVB" to "RSVI." The following table sets forth, for the fiscal
quarters indicated, the high and low closing sale prices and dividends for our
common stock. Our common stock first began trading on April 5, 2002 upon
completion of our initial public offering.
Dividends Paid
Fiscal Year High Low Per Share
- ----------- ---- --- --------------
2002:
3rd Quarter.............. $12.95 $12.50 --
4th Quarter.............. $12.95 $12.35 --
2003:
1st Quarter.............. $13.45 $12.65 $0.05
2nd Quarter.............. $17.19 $12.90 --
3rd Quarter.............. $17.00 $16.15 $0.10
4th Quarter.............. $17.10 $16.35 --
2004:
1st Quarter.............. $19.75 $16.85 $0.10
2nd Quarter.............. $20.50 $18.60 --
3rd Quarter.............. $19.75 $17.25 $0.15
4th Quarter.............. $17.50 $16.00 --
(through September 8, 2004)
On September 8, 2004, the last practicable trading day prior to the
commencement of our offer, the closing sale price of our common stock was
$17.10, as quoted on the OTC Bulletin Board. WE URGE YOU TO OBTAIN MORE CURRENT
MARKET QUOTATIONS FOR OUR COMMON STOCK.
21
9. SOURCE AND AMOUNT OF FUNDS.
Assuming that 202,000 shares are tendered in the offer at a price between
$17.00 and $19.00 per share, the aggregate purchase price paid by us will be
between $3,434,000 and $3,838,000. We expect that our fees and expenses for the
offer will be approximately $105,000.
Upon payment of the dividend by the Bank to us in the amount of $4.0
million, RSV Bancorp will have sufficient cash on hand to pay all expenses in
connection with the offer. We anticipate that we will have all of the funds
necessary to purchase shares tendered in our offer, as well as to pay related
fees and expenses, from our existing assets, primarily out of available cash.
10. INFORMATION ABOUT US AND THE SHARES.
GENERAL. We are the parent company for Mt. Troy Bank. We were formed as a
Pennsylvania corporation under the name "Reserve Bancorp, Inc." in December 2001
at the direction of the Bank in connection with the Bank's conversion from a
mutual to stock form of ownership. We acquired all of the capital stock issued
by the Bank upon its conversion. In April 2002, the Bank completed its
conversion in connection with a $7.6 million initial public offering of common
stock by us. Effective July 1, 2004, we changed our name to RSV Bancorp, Inc.
and our trading symbol was changed from "RSVB" to "RSVI." We are a unitary
savings and loan holding company and, under existing laws, generally are not
restricted in the types of business activities in which we may engage provided
that the Bank retains a specified amount of its assets in housing-related
investments. At the present time, we conduct no significant business or
operations of our own other than holding all of the outstanding stock of the
Bank and investing our portion of the net proceeds obtained in the conversion.
The Bank attracts deposits from the general public and uses such deposits,
together with borrowings and other funds, primarily to originate and fund loans
secured by first mortgages on owner-occupied, one-to-four family residences in
its market area. The Bank also makes commercial real estate, commercial, home
equity loans, loans secured by deposits, automobile loans and personal loans and
invests in municipal obligations, mortgage-backed securities, and other
investments.
SHARES OUTSTANDING. As of June 30, 2004, we had 673,734 issued and
outstanding shares of common stock.
The 202,000 shares that we are offering to purchase represent approximately
30% of our issued and outstanding stock as of June 30, 2004. Assuming that we
purchase all 202,000 shares that we are offering to purchase, the number of our
issued and outstanding shares would be reduced to 471,734 immediately after the
offer.
FINANCIAL STATEMENTS. Our historical financial statements for the fiscal
years ended September 30, 2003 and 2002 are incorporated herein by reference to
Exhibit 13 to our Annual Report on Form 10-KSB for the fiscal year ended
September 30, 2003, filed with the SEC.
11. INTERESTS OF DIRECTORS AND EXECUTIVE OFFICERS; TRANSACTIONS AND
ARRANGEMENTS CONCERNING SHARES.
Interests Of Directors And Executive Officers. Information about our
directors and executive officers stock ownership is set forth below. As of
September 8, 2004, our directors and executive officers as a group beneficially
owned (including pursuant to exercisable options) an aggregate of 62,399 shares
(approximately 8.99% of the outstanding shares including shares issuable upon
the exercise of vested
22
options held by directors and executive officers). Such ownership includes
20,200 shares as of September 8, 2004 subject to exercisable stock options which
are held by executive officers and directors.
Our directors and executive officers are entitled to participate in our
offer on the same basis as all other stockholders. We have been advised that
none of our directors or executive officers intend to tender any of their shares
pursuant to the offer. As of September 8, 2004, 59,000 shares, or approximately
8.76% of the outstanding shares, were held in the employee stock ownership plan.
We have also been advised that the trustee of the employee stock ownership plan
does not intend to tender any shares pursuant to the offer.
Assuming we purchase 202,000 shares pursuant to the offer, the percentage
of shares beneficially owned by executive officers and directors, would be
approximately 24.27% of the outstanding shares immediately after the offer,
including shares issuable upon the exercise of options held by executive
officers and directors and our Employee Stock Ownership Plan ("ESOP").
Set forth below is a list of RSV Bancorp's directors and executive officers
and for each, a description of beneficial ownership of our common stock. Unless
otherwise noted below, the business address of each of the following persons is
2000 Mt. Troy Road, Pittsburgh, Pennsylvania 15212.
PERCENT OF
SHARES OF
NAME OF AMOUNT AND NATURE OF COMMON STOCK
BENEFICIAL OWNER BENEFICIAL OWNERSHIP OUTSTANDING (1)
- ---------------- -------------------- ---------------
David P. Butler 21,794 (2) 3.21%
Robert B. Shust 19,564 (2) 2.88%
Timothy Schneider 7,064 (2) 1.04%
Brian S. Allen 700 *
EXECUTIVE OFFICERS WHO ARE
NOT DIRECTORS
Gerard R. Kunic - President -- --
Robert B. Kastan - Treasurer/Controller 13,277 (2) 1.96%
All Directors and Executive Officers
As a Group (6 Persons) 62,399 (3) 8.99%
- ------------
* Less than 1%
(1) Includes shares of common stock held directly as well as by spouses or
minor children and other indirect ownership.
(2) Includes 5,050 shares that may be purchased pursuant to the exercise of
options within 60 days of the date hereof.
(3) Includes 20,200 shares that may be purchased pursuant to the exercise of
options within 60 days of the date hereof.
The following table lists the name and address of each person or group who
beneficially own more than 5% of RSV Bancorp's outstanding shares of common
stock. Other than as noted below, management knows of no person or group that
owns more than 5% of the outstanding shares of common stock.
23
Percent of
Shares of
Name and Address Amount and Nature of Common Stock
Of Beneficial Owner Beneficial Ownership Outstanding
- ------------------- -------------------- ------------
Mt. Troy Bank Employee Stock 59,000 8.76%
Ownership Plan Trust
2000 Mt. Troy Road
Pittsburgh, Pennsylvania 15212
TRANSACTIONS AND ARRANGEMENTS CONCERNING SHARES. Based on our records and
information provided to us by our directors, executive officers, associates and
subsidiaries, neither we, nor any of our associates or subsidiaries, nor any of
our directors or executive officers, have effected any transactions in our
shares during the 60 days prior to the date hereof
Except as otherwise described in this document and except for outstanding
options to purchase shares granted from time to time over recent years to
certain employees (including executive officers) and directors pursuant to our
stock option plan, neither we nor, to our knowledge, any of our affiliates,
directors or executive officers, is a party to any agreement, arrangement or
understanding with any other person relating, directly or indirectly, to the
tender offer or with respect to any of our securities, including, but not
limited to, any agreement, arrangement or understanding concerning the transfer
or the voting of our securities, joint ventures, loan or option arrangements,
puts or calls, guarantees of loans, guarantees against loss or the giving or
withholding of proxies, consents or authorizations.
Except as disclosed in this offer, RSV Bancorp, its directors and executive
officers have no current plans or proposals in connection with this offer which
relate to or would result in:
o the acquisition by any person of additional securities of RSV Bancorp
or the disposition of securities of RSV Bancorp, except for possible
exercises, cashless or otherwise, of outstanding options to purchase
shares in the ordinary course by executive officers and directors of
RSV Bancorp;
o an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving RSV Bancorp or any of our
subsidiaries;
o a purchase, sale or transfer of a material amount of assets of RSV
Bancorp or any of our subsidiaries;
o any change in the present board of directors or management of RSV
Bancorp;
o any material change in the present dividend rate or policy, or
indebtedness or capitalization of RSV Bancorp;
o any other material change in RSV Bancorp's corporate structure or
business;
o any change in our charter or bylaws or any actions which may impede
the acquisition of control of RSV Bancorp by any person;
24
o a class of equity security of RSV Bancorp being delisted from a
national securities exchange;
o a class of equity securities of RSV Bancorp becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the
Securities Exchange Act of 1934 (see Section 12); or
o the suspension of our obligation to file reports pursuant to Section
15(d) of the Securities Exchange Act of 1934. See Section 7.
While the directors and executive officers of RSV Bancorp do not intend to
accomplish any of the foregoing purposes in connection with this offer, RSV
Bancorp may formulate plans for one or more of these purposes in the future.
25
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
The following summary historical consolidated financial information has
been derived from our audited financial statements for the years ended September
30, 2003 and 2002 and from our unaudited financial statements for the nine
months ended June 30, 2004 and 2003 and, in the opinion of management, includes
all adjustments (consisting of normal recurring accruals) that are necessary for
a fair presentation of the financial position and results of operations for such
periods. The summary information should be read in conjunction with the
consolidated financial statements and the notes thereto included in our
Quarterly report on Form 10-QSB for the quarter ended June 30, 2004 and our
Annual Report on Form 10-KSB for the fiscal year ended September 30, 2003.
COPIES OF THESE REPORTS MAY BE OBTAINED AS DESCRIBED IN THIS DOCUMENT.
RSV BANCORP, INC.
SUMMARY HISTORICAL FINANCIAL INFORMATION
FINANCIAL HIGHLIGHTS
- --------------------
(Dollars in Thousands, except per share data) At June 30, At September 30,
----------------- -----------------
2004 2003 2003 2002
------- ------- ------- -------
Total assets $76,700 $71,988 $71,939 $60,560
Loans receivable, net 38,279 34,989 34,887 35,017
Investment and mortgage-backed securities 34,905 31,390 32,043 22,738
Cash and cash equivalents 1,378 4,004 3,350 1,656
Deposits 56,723 49,902 50,468 42,986
FHLB advances 7,465 8,725 8,378 4,883
Total stockholders' equity 11,686 12,592 12,597 12,350
For Nine Months Ended For the Year Ended
June 30, At September 30,
---------------------- ------------------
2004(1) 2003(1) 2003 2002
------- ------- ------- -------
Interest income $2,851 $2,892 $3,811 $3,417
Interest expense 1,099 1,271 1,670 1,625
Net interest income 1,752 1,621 2,141 1,792
Provision for loan losses 14 14 18 18
Non-interest income 227 193 238 187
Non-interest expense 1,073 964 1,263 1,139
Income tax expense 335 305 364 317
Net income 557 531 734 505
Basic earnings per share 0.86 0.76 1.06 0.38
Diluted earnings per share 0.82 0.75 1.04 0.38
Dividends per share 0.25 0.15 0.15 --
Book value per share 17.35 16.79 17.09 16.30
- ------
(1) The ratios for the nine month period have been annualized
26
OTHER SELECTED DATA
For Nine Months Ended For the Year Ended
June 30, At September 30,
---------------------- ------------------
2004(1) 2003(1) 2003 2002
------- ------- ------- -------
Return on average assets (net income divided
by average total assets) 1.00% 1.07% 1.08% 0.97%
Return on average equity (net income divided
by average equity) 5.99 5.64 5.84 6.26
Average interest-earning assets to average
interest-bearing liabilities 119.10 122.54 122.02 117.00
Average equity to average assets ratio
(average equity divided by average total
assets) 16.75 18.92 18.53 15.43
Equity to assets at period end 15.24 17.49 17.51 20.39
Dividend payout ratio 21.80 14.80 14.15 n/a
- ------
(1) The ratios for the nine month period have been annualized.
27
SUMMARY UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The following summary unaudited pro forma consolidated financial
information for the nine months ended June 30, 2004 and the year ended September
30, 2003 has been adjusted for certain costs and expenses to be incurred as a
result of the purchase of 202,000 shares pursuant to this offer. The income
statement gives effect to the purchase of shares as of the beginning of each
period presented. The balance sheet data gives effect to the purchase of shares
as of the balance sheet date. Effect has been given to costs to be incurred in
connection with the offer, which are estimated to be $105,000. Such costs will
be included as part of the cost of the shares repurchased.
The summary unaudited pro forma consolidated financial information should
be read in conjunction with the summary historical consolidated financial
information included in this document. The pro forma income statement data and
balance sheet data are not necessarily indicative of the financial position or
results of operations that would have been obtained had the offer been completed
as of the dates indicated or that may be attained in the future.
RSV BANCORP, INC.
UNAUDITEDPRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
YEAR ENDED SEPTEMBER 30, 2003
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
202,000 Shares Purchased at
$17.00 $19.00
per share per share
Interest income (a) 3,730 3,721
Interest expense (1,670) (1,670)
-------- -------
Net interest income 2,060 2,051
Provision for loan losses (18) (18)
-------- -------
Net interest income after provision
for loan losses 2,042 2,033
Noninterest income 238 238
Noninterest expenses (1,263) (1,262)
Income before income taxes 1,017 1,009
Income tax expense/(benefit) (b) (337) (334)
-------- -------
Net income 680 675
======== =======
Basic earnings per share $ 1.38 $ 1.37
======== =======
Diluted earnings per share $ 1.35 $ 1.34
======== =======
Weighted average shares outstanding (c) 491,732
Weighted average fully diluted shares outstanding(c) 503,095
(a) Interest income is reduced assuming a 2.28% rate. The funds used to
purchase the shares are primarily cash and short-term investment
securities.
(b) Income tax rates are not assumed to change.
(c) Shares are reduced by 202,000.
28
RSV BANCORP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
NINE MONTHS ENDED JUNE 30, 2004
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
202,000 Shares Purchased at
$17.00 $19.00
per share per share
Interest income (a) 2,697 2,680
Interest expense (1,099) (1,099)
-------- --------
Net interest income 1,598 1,581
Provision for loan losses (14) (14)
-------- --------
Net interest income after provision
for loan losses 1,584 1,567
Noninterest income 227 227
Noninterest expenses (1,073) (1,073)
-------- --------
Income before income taxes 738 721
Income tax expense/(benefit) (b) (277) (271)
-------- --------
Net income 461 450
======== ========
Basic earnings per share $ 1.38 $ 1.34
======== ========
Diluted earnings per share $ 1.28 $ 1.25
======== ========
Weighted average shares outstanding (c) 447,116
Weighted average fully diluted shares
outstanding (c) 479,941
(a) Interest income is reduced assuming a 4.35% rate. The funds used to
purchase the shares are primarily cash and short-term investment
securities.
(b) Income tax rates are not assumed to change.
(c) Shares are reduced by 202,000.
29
RSV BANCORP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
SEPTEMBER 30, 2003
(DOLLARS IN THOUSANDS)
202,000 Shares Purchased at
$17.00 $19.00
per share per share
--------- ---------
ASSETS
Cash and cash equivalents (a) 1,000 1,000
Investment securities (a) 30,854 30,450
Stock in Federal Home Loan Bank of
Pittsburgh, at cost 675 675
Loans receivable, net 34,887 34,887
Accrued interest receivable 501 501
Premises and equipment, net 281 281
Other assets 148 143
------ ------
Total assets 68,346 67,937
====== ======
LIABILITIES
Deposits 50,468 50,468
Advances from Federal Home Loan Bank 8,378 8,378
Other liabilities 496 496
------ ------
Total liabilities 59,342 59,342
STOCKHOLDERS' EQUITY
Common stock 76 76
Additional paid-in capital 7,128 7,128
Unearned ESOP/RSP shares (684) (684)
Retained earnings 6,222 6,217
Accumulated other comprehensive income, net 143 143
Treasury stock (b) (3,881) (4,285)
------ ------
Total stockholders' equity 9,004 8,595
------ ------
Total liabilities and stockholders' equity 68,346 67,937
====== ======
(a) Cash and investment securities have been reduced to reflect the cash
required for the repurchase and the expected expenses of the offering.
(b) Treasury stock reflects the increase in treasury stock and the expected
expenses of the offering.
30
RSV BANCORP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 2004
(DOLLARS IN THOUSANDS)
202,000 Shares Purchased at
$17.00 $19.00
per share per share
--------- ---------
ASSETS
Cash and cash equivalents (a) 1,000 1,000
Investment securities (a) 31,744 31,340
Stock in Federal Home Loan Bank of
Pittsburgh, at cost 610 610
Loans receivable, net 38,279 38,279
Accrued interest receivable 514 514
Premises and equipment, net 445 445
Other assets 474 463
------ ------
Total assets 73,066 72,651
====== ======
LIABILITIES
Deposits 56,723 56,723
Advances from Federal Home Loan Bank 7,465 7,465
Other liabilities 826 826
------ ------
Total liabilities 65,014 65,014
STOCKHOLDERS' EQUITY
Common stock 76 76
Additional paid-in capital 7,167 7,167
Unearned ESOP/RSP shares (576) (576)
Retained earnings 6,559 6,548
Accumulated other comprehensive income, net (126) (126)
Treasury stock (b) (5,048) (5,452)
------ ------
Total stockholders' equity 8,052 7,637
------ ------
Total liabilities and stockholders' equity 73,066 72,651
====== ======
(a) Cash and investment securities have been reduced to reflect the cash
required for the repurchase and the expected expenses of the offering.
(b) Treasury stock reflects the increase in treasury stock and the expected
expenses of the offering.
31
ADDITIONAL INFORMATION. We are subject to the information and reporting
requirements of the Exchange Act, and in accordance with such laws we file with
the SEC periodic reports, proxy statements and other information relating to our
business, financial condition and other matters. We are required to disclose in
these proxy statements filed with the SEC certain information, as of particular
dates, concerning our directors and executive officers, their compensation,
stock options granted to them, the principal holders of our securities and any
material interest of such persons in transactions with us. We have also filed
with the SEC an Issuer Tender Offer Statement on Schedule TO, which includes
additional information with respect to our offer.
The reports, statements and other information (including any exhibits,
amendments or supplements to such documents) we file may be inspected and copied
at the public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549. You may obtain information on the
operation of the public reference rooms by calling the SEC at 1-800-SEC-0330.
Our SEC filings are also available to the public without charge on the SEC's
website at www.sec.gov.
INCORPORATION BY REFERENCE. The rules of the SEC allow us to "incorporate
by reference" information into this document, which means that we can disclose
important information to you by referring you to another document filed
separately with the SEC. These documents contain important information about us.
SEC FILINGS PERIOD OR DATE FILED
----------------------------- ------------------------------
Annual Report on Form 10-KSB Year ended September 30, 2003
Quarterly Report on Form 10-QSB Quarter ended June 30, 2004
Proxy Statement for
Annual Meeting of Stockholders Filed December 26, 2003
You can obtain any of the documents incorporated by reference in this
document from us without charge, excluding any exhibits to those documents, by
requesting them in writing or by telephone from us at RSV Bancorp, Inc., 2000
Mt. Troy Road, Pittsburgh, Pennsylvania 15212, telephone: (412) 322-6107. Please
be sure to include your complete name and address in your request. If you
request any incorporated documents, we will mail them to you by first class
mail, or another equally prompt means, within one (1) business day after we
receive your request. In addition, you can obtain copies of these documents from
the SEC's website. Such documents may also be inspected at the locations
described above.
12. EFFECTS OF OUR OFFER ON THE MARKET FOR OUR SHARES; REGISTRATION UNDER THE
EXCHANGE ACT.
Our purchase of shares in our offer will reduce the number of shares that
might otherwise be traded publicly and may reduce the number of stockholders.
The shares are currently traded on the OTC Bulletin Board. There can be no
assurance that stockholders will be able to find willing buyers for their shares
after the offer.
The shares are registered under the Securities Exchange Act of 1934 which
requires, among other things, that we furnish certain information to our
stockholders and the SEC and comply with the SEC's proxy rules in connection
with our meetings of stockholders. Upon completion of the offer, we will still
be subject to the reporting requirements of the Exchange Act as we do not
anticipate our number of record stockholders being reduced below 300. Moreover,
in connection with the Bank's conversion and our initial
32
public offering, we are obligated to remain registered for at least three years
after the completion of the conversion or until April 5, 2005.
Our shares are not "margin securities" under the rules of the Federal
Reserve Board and will continue to not be "margin securities" following the
purchase of shares under the offer for purposes of the Federal Reserve Board's
margin rules and regulations.
The Savings and Loan Holding Company Act and the Change in Bank Control Act
each set forth thresholds with respect to the ownership of voting shares of a
savings and loan holding company of 5% to 10%, respectively, over which the
owner of such voting shares may be determined to control such savings and loan
holding company. If, as a result of the offer, the ownership interest of any
stockholder of ours is increased over these thresholds, such stockholder may be
required to reduce its ownership interest in us or file a notice with
regulators. Each stockholder whose ownership interest may be so increased is
urged to consult the stockholder's own legal counsel with respect to the
consequences to the stockholder of the offer.
13. LEGAL MATTERS; REGULATORY APPROVALS.
Except as otherwise described in this document, we are not aware of any
license or regulatory permit material to our business that would be adversely
affected by our acquisition of shares as contemplated by our offer or of any
approval or other action by any government or governmental, administrative or
regulatory authority or agency, domestic, foreign or supranational, that would
be required for our acquisition or ownership of shares as contemplated by our
offer. Should any such approval or other action be required, we presently
contemplate that we will seek that approval or other action. We are unable to
predict whether we will be required to delay the acceptance for payment of or
payment for shares tendered in response to our offer pending the outcome of any
such matter. There can be no assurance that any such approval or other action,
if needed, would be obtained or would be obtained without substantial cost or
conditions or that the failure to obtain the approval or other action might not
result in adverse consequences to our business and financial condition.
14. EXTENSION OF OUR OFFER; TERMINATION; AMENDMENT.
We reserve the right, in our sole discretion, at any time and from time to
time, to extend the period of time during which our offer is open and to delay
acceptance for payment of, and payment for, any shares by giving oral or written
notice of such extension to the depositary and making a public announcement of
such extension. Our reservation of the right to delay acceptance for payment is
limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which requires
that we must pay the consideration offered or return the shares tendered
promptly after termination or withdrawal of our offer.
We also reserve the right, in our sole discretion, to terminate our offer
and not accept for payment or pay for any shares not previously accepted for
payment or paid for or, subject to applicable law, to postpone payment for
shares if any conditions to our offer fail to be satisfied by giving oral or
written notice of such termination or postponement to the depositary and making
a public announcement of such termination or postponement. Our reservation of
the right to delay payment for shares which we have accepted for purchase is
limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which requires
that we must pay the consideration offered or return the shares tendered
promptly after termination or withdrawal of our offer.
Subject to compliance with applicable law, we further reserve the right, in
our sole discretion, and regardless of whether or not any of the events or
conditions described in Section 7 have occurred or are deemed by us to have
occurred, to amend our offer in any respect, including, without limitation, by
decreasing or increasing the consideration offered in our offer to holders of
shares or by decreasing or
33
increasing the number of shares being sought in our offer. Amendments to our
offer may be made at any time and from time to time by public announcement, such
announcement, in the case of an extension, to be issued no later than 9:00 a.m.,
New York City Time, on the next business day after the last previously scheduled
or announced Expiration Date.
Without limiting the manner in which we may choose to make a public
announcement, except as required by applicable law, we have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by making a release through Business Wire, Dow Jones News Service or
another comparable news service.
If we materially change the terms of our offer or the information
concerning our offer, we will extend our offer to the extent required by Rules
13e-4(d)(2), 13e-4(e)(3) and 13e-4(f)(1) promulgated under the Exchange Act.
These rules and certain related releases and interpretations of the SEC provide
that the minimum period during which a tender offer must remain open following
material changes in the terms of the tender offer or information concerning the
tender offer (other than a change in price or a change in percentage of
securities sought) will depend on the facts and circumstances, including the
relative materiality of such terms or information. If we undertake any of the
following actions:
o increase or decrease the range of prices to be paid for the shares,
o increase the number of shares being sought in our offer by more than
2% of our outstanding common stock, or
o decrease the number of shares being sought in our offer, and
our offer is scheduled to expire at any time earlier than the expiration of a
period ending on the tenth business day from, and including, the date that such
notice of an increase or decrease is first published, sent or given to
stockholders in the manner specified in this Section 14, then our offer will be
extended until the expiration of such period of ten business days.
Pursuant to Rule 13e-4 promulgated under the Exchange Act, we have filed
with the SEC an Issuer Tender Offer Statement on Schedule TO which contain
additional information with respect to our offer. The Schedule TO, including the
exhibits and any amendments and supplements to those documents, may be examined,
and copies may be obtained, at the same places and in the same manner as is set
forth in Section 10 with respect to information concerning us.
15. FEDERAL INCOME TAX CONSEQUENCES.
The following summary describes the material United States federal income
tax consequences relating to our offer. This summary is based upon the Internal
Revenue Code of 1986, as amended, Treasury regulations under the Internal
Revenue Code (the "Code") administrative pronouncements and judicial decisions,
all as in effect as of the date hereof and all of which are subject to change,
possibly with retroactive effect. This summary addresses only stockholders who
hold shares as capital assets within the meaning of Section 1221 of the Code and
does not address all of the tax consequences that may be relevant to
stockholders in light of their particular circumstances or to certain types of
stockholders subject to special treatment under the Code, including, without
limitation, certain financial institutions, dealers in securities or
commodities, traders in securities who elect to apply a mark-to-market method of
accounting, insurance companies, tax-exempt organizations, persons who hold
shares as a position in a "straddle" or as a part of a "hedging," "conversion"
or "constructive sale" transaction for United States federal income tax purposes
or persons who received their shares through the exercise of employee stock
options or otherwise as compensation. In addition, this discussion applies only
to "United States holders" (as defined below).
34
This summary also does not address the state, local or foreign tax consequences
of participating in our offer. For purposes of this discussion, a "United States
holder" means:
o a citizen or resident of the United States;
o a corporation or other entity taxable as a corporation created or
organized in the United States or under the laws of the United States
or of any political subdivision of the United States;
o an estate, the income of which is includible in gross income for
United States federal income tax purposes regardless of its source; or
o a trust whose administration is subject to the primary supervision of
a United States court and which has one or more United States persons
who have the authority to control all of its substantial decisions.
HOLDERS OF SHARES WHO ARE NOT UNITED STATES HOLDERS SHOULD CONSULT THEIR
TAX ADVISORS REGARDING THE UNITED STATES FEDERAL INCOME TAX CONSEQUENCES AND ANY
APPLICABLE FOREIGN TAX CONSEQUENCES OF OUR OFFER.
STOCKHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISOR TO DETERMINE THE
PARTICULAR TAX CONSEQUENCES TO THEM OF PARTICIPATING OR NOT PARTICIPATING IN OUR
OFFER.
CHARACTERIZATION OF THE PURCHASE. The purchase of a United States holder's
shares by us in our offer will be a taxable transaction for United States
federal income tax purposes. As a consequence of the purchase, a United States
holder will, depending on the United States holder's particular circumstances,
be treated either as having sold the United States holder's shares or as having
received a distribution in respect of stock from RSV Bancorp.
Under Section 302 of the Code, a United States holder whose shares are
purchased by us under our offer will be treated as having sold such holder's
shares, and thus, will recognize capital gain or loss if the purchase:
o results in a "complete termination" of the United States holder's
equity interest in RSV Bancorp;
o results in a "substantially disproportionate" redemption with respect
to the United States holder; or
o is "not essentially equivalent to a dividend" with respect to the
United States holder.
Each of these tests, referred to as the "Section 302 tests," is explained
in more detail below.
If a United States holder satisfies any of the Section 302 tests explained
below under the caption "Section 302 Tests", the United States holder will be
treated as if it sold its shares to us and will recognize capital gain or loss
equal to the difference between the amount of cash received under our offer and
the United States holder's adjusted tax basis in the shares surrendered in
exchange therefore. This gain or loss will be long-term capital gain or loss if
the United States holder's holding period for the shares that were sold exceeds
one year as of the date of purchase by us under our offer. Specified limitations
apply to the
35
deductibility of capital losses by United States holders. Gain or loss must be
determined separately for each block of shares (shares acquired at the same cost
in a single transaction) that is purchased by us from a United States holder
under our offer. A United States holder may be able to designate, generally
through its broker, which blocks of shares it wishes to tender under our offer
if less than all of its shares are tendered under our offer, and the order in
which different blocks will be purchased by us in the event of proration under
our offer. United States holders should consult their tax advisors concerning
the mechanics and desirability of that designation.
If a United States holder does not satisfy any of the Section 302 tests
explained below, the purchase of a United States holder's shares by us under our
offer will not be treated as a sale or exchange under Section 302 of the Code
with respect to the United States holder. Instead, the entire amount received by
a United States holder with respect to the purchase of its shares by us under
our offer will be treated as a dividend distribution to the United States holder
with respect to its shares under Section 301 of the Code, taxable at ordinary
income tax rates, to the extent of the United States holder's share of our
current and accumulated earnings and profits (within the meaning of the Code).
To the extent the amount of the distribution exceeds the United States holder's
share of our current and accumulated earnings and profits, the excess first will
be treated as a tax-free return of capital to the extent of the United States
holder's adjusted tax basis in its shares and any remainder will be treated as
capital gain (which may be long-term capital gain as described above). To the
extent that a purchase of a United States holder's shares by us under our offer
is treated as the receipt by the United States holder of a dividend, the United
States holder's adjusted tax basis in the purchased shares will be added to any
shares retained by the United States holder.
We cannot predict whether or the extent to which our offer will be
oversubscribed. If our offer is oversubscribed, proration of tendered shares
under our offer will cause us to accept fewer shares than are tendered.
Therefore, no assurance can be given that we will purchase a sufficient number
of a United States holder's shares under our offer to ensure that the United
States holder's receives sale treatment, rather than dividend treatment, for
United States federal income tax purposes under the rules discussed below.
CONSTRUCTIVE OWNERSHIP OF STOCK AND OTHER ISSUES. In applying each of the
Section 302 tests explained below, United States holders must take into account
not only shares that they actually own but also shares they are treated as
owning under the constructive ownership rules of Section 318 of the Code. Under
the constructive ownership rules, a United States holder is treated as owning
any shares that are owned (actually and in some cases constructively) by certain
related individuals and entities as well as shares that the United States holder
has the right to acquire by exercise of an option or by conversion or exchange
of a security. Due to the factual nature of the Section 302 tests explained
below, United States holders should consult their tax advisors to determine
whether the purchase of their shares under our offer qualifies for sale
treatment in their particular circumstances.
SECTION 302 TESTS. One of the following tests must be satisfied in order
for the purchase of shares by us under our offer to be treated as a sale or
exchange for federal income tax purposes:
o Complete Termination Test. The purchase of a United States holder's
shares by us under our offer will result in a "complete termination"
of the United States holder's equity interest in RSV Bancorp if all of
the shares that are actually owned by the United States holder are
sold under our offer and all of the shares that are constructively
owned by the United States holder, if any, are sold under our offer
or, with respect to shares owned by certain related individuals, the
United States holder effectively waives, in accordance with Section
302(c) of the Code, attribution of shares which otherwise would be
considered as constructively owned by the United States holder. United
States holders wishing to satisfy
36
the "complete termination" test through waiver of the constructive
ownership rules should consult their tax advisors.
o Substantially Disproportionate Test. The purchase of a United States
holder's shares by us under our offer will result in a "substantially
disproportionate" redemption with respect to the United States holder
if, among other things, the percentage of the then outstanding shares
actually and constructively owned by the United States holder
immediately after the purchase is less than 80% of the percentage of
the shares actually and constructively owned by the United States
holder immediately before the purchase (treating as outstanding all
shares purchased under our offer).
o Not Essentially Equivalent to a Dividend Test. The purchase of a
United States holder's shares by us under our offer will be treated as
"not essentially equivalent to a dividend" if the reduction in the
United States holder's proportionate interest in RSV Bancorp as a
result of the purchase constitutes a "meaningful reduction" given the
United States holder's particular circumstances. Whether the receipt
of cash by a stockholder who sells shares under our offer will be "not
essentially equivalent to a dividend" will depend upon the
stockholder's particular facts and circumstances. The Internal Revenue
Service has indicated in a published revenue ruling that even a small
reduction in the percentage interest of a stockholder whose relative
stock interest in a publicly held corporation is minimal (for example,
an interest of less than 1%) and who exercises no control over
corporate affairs should constitute a "meaningful reduction." United
States holders should consult their tax advisors as to the application
of this test in their particular circumstances.
CORPORATE STOCKHOLDER DIVIDEND TREATMENT. In the case of a corporate United
States holder, to the extent that any amounts received under our offer are
treated as a dividend, such holder may be eligible for the dividends-received
deduction. The dividends-received deduction is subject to certain limitations.
In addition, any amount received by a corporate United States holder pursuant to
our offer that is treated as a dividend may constitute an "extraordinary
dividend" under Section 1059 of the Code. Corporate United States holders should
consult their own tax advisors as to the application of Section 1059 of the Code
to our offer, and to the tax consequences of dividend treatment in their
particular circumstances.
STOCKHOLDERS WHO DO NOT RECEIVE CASH UNDER OUR OFFER. Stockholders whose
shares are not purchased by us under our offer will not incur any tax liability
as a result of the completion of our offer.
BACKUP WITHHOLDING TAX. See Section 3 with respect to the application of
United States federal backup withholding tax.
THE DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY. WE
URGE YOU TO CONSULT YOUR TAX ADVISOR TO DETERMINE THE PARTICULAR TAX
CONSEQUENCES TO YOU OF OUR OFFER, INCLUDING THE APPLICABILITY AND EFFECT OF
STATE, LOCAL AND FOREIGN TAX LAWS.
37
16. FEES AND EXPENSES.
We have retained D. F. King & Co., Inc. to act as our information agent in
connection with our offer. D. F. King & Co., Inc. as information agent, may
contact stockholders by mail, telephone, facsimile, telex, telegraph, other
electronic means and personal interviews, and may request brokers, dealers,
commercial banks, trust companies and other nominee stockholders to forward
materials relating to the offer to beneficial owners. D. F. King & Co., Inc.
will receive reasonable and customary compensation in connection with our offer.
Registrar and Transfer Company, as the depositary for our offer, will be
reimbursed for certain out-of-pocket costs in connection with our offer.
No fees or commissions will be payable by us to brokers, dealers,
commercial banks or trust companies (other than fees to the parties described
above) for soliciting tenders of shares under our offer. Stockholders holding
shares through brokers or banks are urged to consult the brokers or banks to
determine whether transaction costs are applicable if stockholders tender shares
through such brokers or banks and not directly to the depositary. We, however,
upon request, will reimburse brokers, dealers, commercial banks and trust
companies for customary mailing and handling expenses incurred by them in
forwarding our offer and related materials to the beneficial owners of shares
held by them as a nominee or in a fiduciary capacity. No broker, dealer,
commercial bank or trust company has been authorized to act as our agent or as
an agent of the information agent or the depositary for purposes of our offer.
We will pay or cause to be paid all stock transfer taxes, if any, on our
purchase of shares except as otherwise provided in this document and Instruction
7 in the letter of transmittal.
17. MISCELLANEOUS.
This offer to purchase and the related letter of transmittal will be mailed
to record holders of shares of our common stock and will be furnished to
brokers, dealers, commercial banks and trust companies whose names, or the names
of whose nominees, appear on our stockholder list or, if applicable, who are
listed as participants in a clearing agency's security position listing for
subsequent transmittal to beneficial owners of shares.
We are not aware of any jurisdiction where the making of our offer is not
in compliance with applicable law. If we become aware of any jurisdiction where
the making of our offer or the acceptance of shares pursuant thereto is not in
compliance with applicable law, we will make a good faith effort to comply with
the applicable law. If, after such good faith effort, we cannot comply with the
applicable law, our offer will not be made to (nor will tenders be accepted from
or on behalf of) the holders of shares in such jurisdiction.
Pursuant to Rule 13e-4 promulgated under the Exchange Act, RSV Bancorp has
filed with the SEC an Issuer Tender Offer Statement on Schedule TO which
contains additional information with respect to our offer. The Schedule TO,
including the exhibits and any amendments and supplements to that document, may
be examined, and copies may be obtained, at the same places and in the same
manner as is set forth in Section 10 with respect to information concerning us.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR BEHALF AS TO
WHETHER YOU SHOULD TENDER OR NOT TENDER YOUR
38
SHARES IN OUR OFFER. WE HAVE NOT AUTHORIZED ANY PERSON TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH OUR OFFER OTHER THAN THOSE
CONTAINED IN THIS DOCUMENT OR IN THE LETTER OF TRANSMITTAL. ANY RECOMMENDATION
OR ANY SUCH INFORMATION OR REPRESENTATION MADE BY ANYONE ELSE MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY RSV BANCORP OR THE INFORMATION AGENT.
RSV BANCORP, INC.
September 14, 2004
39
THE DEPOSITARY FOR OUR OFFER IS:
REGISTRAR AND TRANSFER COMPANY
By Mail or Overnight Courier: For Assistance: By Hand:
Registrar and Transfer Company (800) 368-5948 c/o The Depository Trust Co.
10 Commerce Drive Transfer Agent Drop
Cranford, New Jersey 07016-3572 55 Water Street, 1st Floor
New York, New York 10041-0099
By Facsimile:
(908) 497-2311
(For Eligible Institutions Only)
The letter of transmittal and certificates for shares and any other required
documents should be sent or delivered by each RSV Bancorp stockholder or such
stockholder's broker, dealer, commercial bank, trust company or nominee to the
depositary at its address set forth above.
Any questions or requests for assistance may be directed to the Information
agent at its telephone number and address set forth below. Requests for
additional copies of this offer to purchase, the letter of transmittal or the
notice of guaranteed delivery may be directed to the information agent at the
telephone number and address set forth below. You may also contact your broker,
dealer, commercial bank, trust company or nominee for assistance concerning our
offer. To confirm delivery of shares, stockholders are directed to contact the
depositary.
THE INFORMATION AGENT FOR THE OFFER IS:
D. F. KING & CO., INC.
48 Wall Street
New York, New York 10005
Banks and Brokers call collect: (212) 269-5550
All others call Toll Free: (800) 207-3158