UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
July 18, 1996
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Date of Report (Date of earliest event reported)
Susquehanna Bancshares, Inc.
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(Exact name of registrant as specified in its charter)
Pennsylvania 0-10674 23-2201716
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(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File Number) ID No.)
26 North Cedar Street
Lititz, Pennsylvania 17543
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(Address of principal executive offices) (Zip Code)
(717) 626-4721
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(registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
Item 5. Other Events.
On July 18, 1996, Susquehanna Bancshares, Inc. (herein referred
to as "SBI" or the "Registrant"), a Pennsylvania business corporation registered
as a bank holding company under the Bank Holding Company Act of 1956, as amended
(the "BHC Act"), entered into: (i) an Agreement and Plan of Affiliation with
Susquehanna Bancshares East, Inc. ("SBI Merger Sub"), a New Jersey corporation
and a wholly-owned subsidiary of SBI, Atcorp, Inc. ("Atcorp"), a New Jersey
corporation registered as a bank holding company under the BHC Act, and Equity
National Bank ("ENB"), a national banking association and a wholly-owned
subsidiary of Atcorp (the "Atcorp Merger Agreement"); and (ii) an Agreement and
Plan of Affiliation with Susquehanna Bancshares East II, Inc. ("SBI Merger Sub
II"), a New Jersey corporation and a wholly-owned subsidiary of SBI, Farmers
Banc Corp. ("FBC"), a New Jersey corporation registered as a bank holding
company under the BHC Act, and Farmers National Bank ("FNB"), a national banking
association and a wholly-owned subsidiary of FBC (the "Farmers Merger
Agreement") (the Atcorp Merger Agreement and the Farmers Merger Agreement are
hereinafter collectively referred to as the "Merger Agreements"). A copy of the
Atcorp Merger Agreement and the Farmers Merger Agreement, as well as a copy of
the Press Release announcing the execution of the Merger Agreements, are filed
as exhibits to this Current Report on Form 8-K.
1. The Atcorp Merger Agreement. The following is a summary
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of the terms and conditions of the Atcorp Merger Agreement and the merger
described therein (the "Atcorp Merger"). This summary is qualified in its
entirety by reference to the full text of the Atcorp Merger Agreement which is
filed as an exhibit to this Current Report on Form 8-K.
General.
Pursuant to the Atcorp Merger Agreement, SBI Merger Sub will
merge with and into Atcorp, with Atcorp as the surviving entity (sometimes
referred to as the "Surviving Corporation"), as a result of which Atcorp will
become a direct wholly-owned subsidiary of SBI, and ENB will become a second-
tier subsidiary of SBI. The name of the Surviving Corporation will be
"Susquehanna Bancshares East, Inc."
As consideration for all of the outstanding capital stock of
Atcorp, SBI has agreed to exchange the outstanding Atcorp Common Stock, par
value $5.00 per share (the "Atcorp Common Stock"), for common stock of SBI, par
value $2.00 per share (the "SBI Common Stock"), at the exchange rate ("Exchange
Ratio") provided in the Atcorp Merger Agreement.
At the effective time of the Atcorp Merger (the "Atcorp
Effective Time"), each share of Atcorp Common Stock issued and outstanding shall
become and be converted into the right to receive shares of SBI Common Stock
determined in conformity with the Exchange Ratio, as set forth below:
(i) So long as the Average Price Per Share of SBI Common Stock
Before Closing is between $25.00 and $31.00, then, 771,750 shares of
SBI Common Stock (the "Atcorp Merger Consideration") shall be
exchanged for all of the outstanding Atcorp Common Stock. The Average
Price Per Share of SBI Common Stock Before Closing will be determined
by adding the price at which SBI Common Stock is reported to have
closed by The Nasdaq Stock Market (or if SBI Common Stock is not
quoted on The Nasdaq Stock Market then as reported by a recognized
source as to the principal trading market on which such shares are
traded) over the period of ten business days ending on the second
business day preceding the date set for the Atcorp Closing, and
dividing such total by ten.
(ii) In the event the Average Price Per Share of SBI Common
Stock Before Closing is less than $25.00 per share (subject to
adjustment pursuant to the Atcorp Merger Agreement), Atcorp
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may terminate the Atcorp Merger Agreement upon written notice within
two days of such determination.
(iii) If the Average Closing Price Per Share of SBI Common Stock
Before Closing is greater than $31.00 per share (subject to adjustment
pursuant to the Atcorp Merger Agreement), SBI may terminate the Atcorp
Merger Agreement upon written notice within two days of such
determination.
(iv) In the event the transactions described in the Atcorp
Merger Agreement are not consummated by March 31, 1997, then either
party may terminate the Atcorp Merger Agreement unless the failure to
so consummate by such time is due to the breach of any representation,
warranty or covenant contained in the Atcorp Merger Agreement by the
party seeking to terminate; provided, however, that such date may be
extended by the written agreement of the parties. If such date is
extended beyond the record date set for SBI's second quarterly
dividend for 1997 and if the Atcorp Effective Time has not occurred
prior to or on such record date, then Atcorp shall receive an
additional 5,000 shares of SBI Common Stock as Atcorp Merger
Consideration.
As of the Atcorp Effective Time, each share of Atcorp Common Stock
held by SBI (other than shares held in a fiduciary capacity or in satisfaction
of a debt previously contracted) and all shares of Atcorp Common Stock owned by
Atcorp as treasury stock will be cancelled, and no exchange or payment will be
made with respect thereto.
The Atcorp Merger Agreement provides that Atcorp shall not declare,
pay or set aside any dividend or other distribution in respect of its capital
stock.
The shares of common stock of SBI Merger Sub and ENB issued and
outstanding immediately prior to the Atcorp Effective Time shall remain
outstanding and unchanged after the merger, and shall thereafter constitute all
of the issued and outstanding shares of the capital stock of the Surviving
Corporation and ENB, respectively. At such time, all of the capital stock of
ENB will be owned by the Surviving Corporation and all of the shares of the
Surviving Corporation will be owned by SBI.
At the Atcorp Effective Time, all issued and outstanding options,
warrants or rights to acquire Atcorp Common Stock or any capital stock of ENB
will be cancelled. No compensation will be payable in the transactions
contemplated in the Atcorp Merger Agreement in respect of any such rights which
remain unexercised at the Atcorp Effective Time.
If prior to the Atcorp Effective Time, the outstanding shares of SBI
Common Stock shall have been increased, decreased, changed into or exchanged for
a different number or kind of shares or securities through a reclassification,
stock dividend, stock split or reverse stock split, or other similar change,
appropriate adjustment will be made to the Exchange Ratio.
Within five business days after the Atcorp Effective Time, SBI shall
cause to be sent to each person who immediately prior to the Atcorp Effective
Time was a holder of record of Atcorp Common Stock transmittal materials and
instructions for surrendering certificates for Atcorp Common Stock in exchange
for the number of whole shares of SBI Common Stock to which such person is
entitled pursuant to the Exchange Ratio.
No certificates for fractional shares of SBI Common Stock will be
issued; rather, SBI will furnish to any holder of Atcorp Common Stock entitled
to a fractional share a check for an amount of cash equal to the fraction of a
share of SBI Common Stock represented by the certificates so surrendered in
accordance with the Exchange Ratio.
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Closing; Effective Date; Termination.
The Atcorp Merger Agreement provides that the Atcorp Closing will
occur following three business days notice to Atcorp, as shall be agreed upon by
all parties which date shall not be later than the 22nd business day after (i)
the last approval of required governmental authorities is granted and any
related waiting periods expire, (ii) the lifting, discharge or dismissal of any
stay of any such governmental approval or of any injunction against the
transactions described in the Atcorp Merger Agreement, and (iii) all shareholder
approvals required by the parties pursuant to the Atcorp Merger Agreement are
received. The Atcorp Merger, and the transactions described by the Atcorp
Merger Agreement, will become effective at 12:01 a.m. on the day following the
day on which the certificate of merger has been duly filed and accepted by the
Secretary of State of New Jersey (the "Atcorp Merger Effective Date"). The
presentation of the certificate for acceptance and filing is subject to the
rights of the Boards of Directors of SBI and Atcorp to terminate the Atcorp
Merger Agreement under certain circumstances.
The Atcorp Merger Agreement provides that, whether before or after its
approval by the shareholders of Atcorp or SBI, it may be terminated and the
transactions contemplated in the Atcorp Merger Agreement abandoned at any time
prior to the Atcorp Effective Date: (a) by mutual consent of SBI and Atcorp, if
the Board of Directors of each so determines by majority vote of the members of
the entire board; (b) by Atcorp in the event (i) of a material breach by SBI of
any representation, warranty, covenant or agreement contained in the Atcorp
Merger Agreement which is not cured or not curable within 30 days after written
notice of such breach is given to SBI by Atcorp or (ii) by written notice to SBI
that any condition precedent to Atcorp's obligations as set forth in the Atcorp
Merger Agreement Article V has not been met or waived by Atcorp at such time as
such condition can no longer be satisfied, or (iii) the Board of Directors of
Atcorp fails to make, withdraws or modifies or changes the favorable
recommendation described at Section 4.2 of the Atcorp Merger Agreement or (iv)
the Board of Directors of Atcorp recommends to the stockholders of Atcorp that
an Acquisition Proposal (as defined in the Atcorp Merger Agreement) is likely to
be more favorable, from a financial point of view, to the stockholders of Atcorp
than the Atcorp Merger; (c) by SBI in the event (i) of a material breach by
Atcorp or ENB of any representation, warranty, covenant or agreement contained
in the Atcorp Merger Agreement which is not cured or not curable within 30 days
after written notice of such breach is given to Atcorp by SBI or (ii) any
condition precedent to SBI's obligations as set forth in Article V of the Atcorp
Merger Agreement has not been met or waived by SBI at such time as such
condition can no longer be satisfied; (d) by Atcorp, by giving written notice of
such election to SBI within two business days following a determination that the
Average Closing Price Per Share of SBI Common Stock Before Closing is less than
$25.00 per share at the time such calculation is required to be made pursuant to
the Atcorp Merger Agreement; (e) by SBI, if it chooses to give written notice of
such election within two business days following a determination that the
Average Closing Price Per Share of SBI Common Stock Before Closing is greater
than $31.00 per share; or (f) by SBI or Atcorp if the Atcorp Merger and the
transactions described in the Atcorp Merger Agreement are not consummated by
March 31, 1997, unless the parties agree to extend the time by which such
closing must occur.
Waiver; Amendment.
Prior to the Atcorp Merger Effective Time, any provision of the Atcorp
Merger Agreement may be: (i) waived by the party benefitted by the provision;
or (ii) amended or modified at any time (including the structure of the
transaction) by an agreement in writing between the parties approved by their
respective boards of directors, except that no amendment or waiver may be made
that would change the form or the amount of the Atcorp Merger Consideration or
otherwise have the effect of prejudicing the Atcorp shareholders' interest in
the Atcorp Merger Consideration following the AI Meeting (as defined in the
Atcorp Merger Agreement).
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Conditions Precedent.
In addition to the shareholder approval by SBI, if applicable, and FBC
shareholders, the Atcorp Merger is contingent upon the satisfaction of a number
of conditions, including, among others: (a) all required approvals, consents,
or waivers, including without limitation, approval by the Board of Governors of
the Federal Reserve System, the Office of the Comptroller of the Currency, the
Pennsylvania Department of Banking, if applicable, the Commissioner of Banking
of the State of New Jersey, and the New Jersey Department of Environmental
Protection and Energy, if applicable, and all applicable statutory waiting
periods shall have expired except those approvals for which failure to obtain
would not have a materially adverse effect on SBI, Atcorp or ENB; (b) there
shall not have occurred any change in the financial condition, properties,
assets, business or results of operation of Atcorp or ENB which, individually or
in the aggregate, has had or might reasonably be expected to result in a
material adverse effect on Atcorp or ENB; (c) the absence of any order, decree
or injunction of a court or agency of competent jurisdiction which would enjoin
or prohibit the consummation of the Atcorp Merger, or any litigation or
proceeding pending against SBI or Atcorp or their subsidiaries by any
governmental agency seeking to prevent consummation of the transactions
described in the Atcorp Merger Agreement; (d) the absence of any statute, rule,
regulation, order, injunction or decree enacted, entered, promulgated or
enforced by any governmental authority which would prohibit, restrict or make
illegal consummation of the Atcorp Merger; (e) any litigation pending against
Atcorp or ENB which, individually or in the aggregate, would have a Material
Adverse Effect (as defined in the Atcorp Merger Agreement) on Atcorp's
consolidated operations, shall have been settled or otherwise resolved on terms
reasonably satisfactory to SBI, Atcorp and ENB; (f) the Atcorp Merger shall meet
the requirements for pooling-of-interests accounting treatment under generally
accepted accounting principles and under the accounting rules of the SEC; (g)
Arthur Andersen LLP shall have furnished to SBI a "cold comfort" letter dated
the date of the notice of the Atcorp Meeting, which letter shall be in customary
form, reasonably acceptable to SBI, and a letter , dated the Effective Date,
inform and substance satisfactory to SBI to the effect that, based upon a
subsequent event review performed with respect to the financial condition of
Atcorp and ENB, and affiliates, for the period from December 31, 1995 to a
specified date not more than five (5) days prior to the date of such letter,
nothing has come to their attention that would indicate that (A) during that
same time period there was any change in the capitalization of Atcorp or ENB on
a consolidated basis, or (B) any material adjustments required to be made to the
audited financial statements for the period ended December 31, 1995 in order for
them to be in conformity with generally accepted accounting principles applied
on a consistent basis with that of prior periods; (h) there shall not have
occurred any change in the financial condition, properties, assets, business or
results of operation of Atcorp or ENB which, individually or in the aggregate,
had or might reasonably be expected to result in a Material Adverse Effect on
Atcorp or ENB; (i) the shares of SBI Common Stock to be issued in the Atcorp
Merger shall have been authorized to be listed for quotation on The Nasdaq Stock
Market; (j) Atcorp shall have received an updated opinion from Janney Montgomery
Scott Inc., dated as of a date no later than the date of the Proxy
Statement/Prospectus mailed to the Atcorp shareholders in connection with the
Atcorp Merger and not subsequently withdrawn, to the effect that the Atcorp
Merger Consideration is fair to Atcorp's shareholders from a financial point of
view. For purposes of the Atcorp Merger Agreement, in the case of ENB, receipt
of a CAMEL rating in connection with a safety and soundness examination which is
lower than the rating given to ENB in connection with the safety and soundness
examination most recently reported prior to the date of the Atcorp Merger
Agreement shall be deemed to have a Material Adverse Effect on ENB.
Representations and Warranties.
The representations and warranties of SBI, SBI Merger Sub, Atcorp and
ENB are set forth in Article III of the Atcorp Merger Agreement. The
representations and warranties relate, among other things, to representations as
to corporate existence and authority and the ability of each party to carry out
the transactions as contemplated by the Atcorp Merger Agreement. Atcorp and ENB
have made additional representations as to the non-existence of any contract
which would be breached by the Atcorp Merger; the accuracy and completeness of
its financial statements and filings with federal or state regulatory agencies,
including state and federal tax filings; the absence of any change in the
financial condition, properties, assets, business, or results of operations
which might
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be expected to result in a material adverse effect; the absence of material
litigation not otherwise disclosed; the absence of regulatory actions; the
absence of undisclosed material liabilities; labor and employee benefits
matters; the status of title to properties; environmental matters; the adequacy
of the allowance for losses on loans; and board and shareholder action. SBI has
made additional representations as to the accuracy and completeness of published
financial statements, filings with the Securities and Exchange Commission and
other federal or state regulatory agencies, and all employee benefit plans; the
non-existence of any contract which would be breached by the Atcorp Merger
Agreement; and the good standing and adequate capitalization of SBI Merger Sub.
On the Atcorp Effective Date, SBI, Atcorp and ENB must each present to the other
certificates evidencing the continued accuracy of the representations and
warranties.
2. The Farmers Merger Agreement. The following is a summary
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of the terms and conditions of the Farmers Merger Agreement. This summary is
qualified in its entirety by reference to the full text of the Farmers Merger
Agreement which is filed as an exhibit to this Current Report on Form 8-K.
General.
Pursuant to the Farmers Merger Agreement, SBI Merger Sub II will
merge with and into FBC (the "FBC Merger"), with FBC as the surviving entity
(sometimes referred to as the "Surviving Corporation") as a result of which FBC
will become a direct wholly-owned subsidiary of SBI, and FNB will become a
second-tier subsidiary of SBI (the "FNB Bank Acquisition"). The name of the
Surviving Corporation will be "Susquehanna Bancshares East II, Inc."
As consideration for all of the outstanding capital stock of
FBC, SBI has agreed to exchange the outstanding FBC Common Stock, par value $.83
per share (the "FBC Common Stock"), for common stock of SBI, par value $2.00 per
share (the "SBI Common Stock"), at the exchange rate ("Exchange Ratio") provided
in the Farmers Merger Agreement (the "FBC Merger Consideration").
At the effective time of the FBC Merger and FNB Bank Acquisition
(the "Farmers Effective Time"), each share of FBC Common Stock issued and
outstanding shall become and be converted into the right to receive shares of
SBI Common Stock determined in conformity with the Exchange Ratio, as set forth
below:
(i) So long as the Average Price Per Share of SBI Common Stock
Before Closing is between $25.00 and $31.00, then, pursuant to the
terms of the Farmers Merger, FBC Common Stock will be exchanged for
SBI Common Stock at a ratio of 2.281 shares of SBI Common Stock for
each share of FBC Common Stock. The Average Price Per Share of SBI
Common Stock Before Closing will be determined by adding the price at
which SBI Common Stock is reported to have closed by the NASDAQ NMS
(or if SBI Common Stock is not quoted on the NASDAQ NMS then as
reported by a recognized source as to the principal trading market on
which such shares are traded) over the period of ten business days
ending on the fifth business day preceding the date set for the FBC
Closing, and dividing such total by ten.
(ii) FBC shall have the right to terminate the Farmers Merger
Agreement if the Average Price Per Share of SBI Common Stock Before
Closing is less than $25.00 (subject to adjustment pursuant to the
Farmers Merger Agreement).
(iii) SBI shall have the right to terminate the Farmers Merger
Agreement if the Average Price Per Share of SBI Common Stock Before
Closing is greater than $31.00 (subject to adjustment pursuant to the
Farmers Merger Agreement); provided, however, if such price is greater
than $31.00 and SBI does not exercise its right to terminate the
Farmers Merger Agreement, then all of the shares of FBC shall be
exchanged for the number of shares as provided in (i) above.
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As of the Farmers Effective Time, each share of FBC Common Stock
held by SBI (other than shares held in a fiduciary capacity or in satisfaction
of a debt previously contracted) shall be cancelled, and no exchange or payment
shall be made with respect thereto.
The shares of Common Stock of SBI Merger Sub II issued and
outstanding immediately prior to the Farmers Effective Time, by virtue of and
after the Farmers Merger, shall be converted into and thereafter constitute the
issued and outstanding shares of the capital stock of the Surviving Corporation.
If prior to the Farmers Effective Time, the outstanding shares of
SBI Common Stock shall have been increased, decreased, changed into or exchanged
for a different number or kind of shares or securities through a
reclassification, stock dividend, stock split or reverse stock split, or other
similar change, appropriate adjustment will be made to the Exchange Ratio.
Within five business days after the Farmers Effective Time, SBI
shall cause to be sent to each person who immediately prior to the Farmers
Effective Time was a holder of record of FBC Common Stock transmittal materials
and instructions for surrendering certificates for FBC Common Stock in exchange
for the number of whole shares of SBI Common Stock to which such person is
entitled pursuant to the Exchange Ratio.
No certificates for fractional shares of SBI Common Stock will be
issued; rather, SBI will furnish to any holder of FBC Common Stock entitled to a
fractional share a check for an amount of cash equal to the fraction of a share
of SBI Common Stock represented by the certificates so surrendered in accordance
with the Exchange Ratio.
Closing; Effective Date; Termination.
The Farmers Merger Agreement provides that the closing of the FBC
Merger and the FNB Bank Acquisition by SBI (the "FBC Closing") will occur
following three business days' notice to FBC, as shall be agreed upon by all
parties, which date shall not be later than the 22nd business day after (a) the
last approval of required regulatory authorities is granted and any related
waiting periods expire, (b) the lifting, discharge or dismissal of any stay of
any governmental approval or of any injunction against the transactions
contemplated in the Farmers Merger Agreement, and (c) all shareholder approvals
required by the parties have been received. Immediately following the FBC
Closing, and provided the FBC Merger Agreement has not been terminated or
abandoned in accordance with the terms thereof, SBI Merger Sub II and FBC will
cause a certificate of merger to be properly prepared and completed and filed
with the Secretary of State of New Jersey. The FBC Merger shall become
effective at 12:01 a.m. on the day (the "Farmers Effective Date") following the
day of which the certificate of merger has been filed and accepted by the
Secretary of State of New Jersey (the "FBC Effective Time").
The Farmers Merger Agreement provides that, whether before or
after the annual meeting of the shareholders of FBC and notwithstanding approval
by the shareholders of FBC, it may be terminated and the transactions
contemplated in the Farmers Merger Agreement abandoned at any time prior to the
Farmers Effective Date: (a) by mutual, written consent of SBI and FBC, if the
Board of Directors of each so determines by majority vote of the members of the
entire board; (b) by FBC if (i) by written notice to SBI that there has been a
material breach by SBI of any representation, warranty, covenant or agreement
contained in the Farmers Merger Agreement and such breach is not cured or not
curable within 30 days after written notice of such breach is given to SBI by
FBC, or (ii) by written notice to SBI that any condition precedent to FBC's
obligations has not been met or waived by FBC at such time as such condition can
no longer be satisfied, (iii) the Board of Directors of FBC fails to make,
withdraws or modifies or changes its favorable recommendation to shareholders,
or (iv) the Board of Directors of FBC recommends to the shareholders of FBC that
an Acquisition Proposal (as defined in the Farmers Merger Agreement) is likely
to be more favorable, from a financial point of view, to the shareholders of FBC
than the FBC Merger; (c) by SBI by written notice to the other parties, in the
event (i) of a material breach by FBC or FNB of any representation, warranty,
covenant or agreement contained in the Farmers Merger Agreement and such breach
is not cured or not curable within 30 days after written notice of such breach
is given to FBC, or (ii) that any
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condition precedent to SBI's obligations has not been met or waived by SBI at
such time as such condition can no longer be satisfied; (d) by FBC, whether
before or after FBC shareholder approval, by giving written notice of such
election to SBI within one business day following a determination that the
Average Closing Price Per Share of the SBI Common Stock Before Closing is less
than $25.00 per share; and (e) by SBI, whether before or after SBI shareholder
approval, if SBI chooses to give written notice as described in the Farmers
Merger Agreement within one business day following a determination that the
Average Closing Price Per Share of the SBI Common Stock Before Closing is
greater than $31.00 per share; or (f) by SBI or FBC by written notice to the
other, in the event that the FBC Merger and FNB Bank Acquisition are not
consummated by March 31, 1997 unless the failure to so consummate by such time
is due to the breach of any representation, warranty or covenant contained in
the FBC Merger Agreement by the party seeking to terminate; provided, however,
that such date may be extended by the written agreement of the parties.
Prior to the Farmers Effective Time, any provision of the Farmers
Merger Agreement may be: (a) waived by the party benefitted by the provision;
or (b) amended or modified at any time (including the structure of the
transaction) by agreement in writing between the parties approved by their
respective Boards of Directors, except that no amendment or waiver may be made
that would change the form or amount of the FBC Merger Consideration or
otherwise have the effect of prejudicing the FBC shareholders' interest in the
FBC Merger Consideration following the FBC Meeting (as defined in the Farmers
Merger Agreement).
Conditions Precedent.
In addition to shareholder approval by FBC shareholders, the
Farmers Merger and the FNB Bank Acquisition are contingent upon the satisfaction
of a number of conditions, including, among others: (a) all required approvals,
consents, or waivers, including without limitation, approval by the Board of
Governors of the Federal Reserve System, the Office of the Comptroller of the
Currency, the Commissioner of Banking of the State of New Jersey, the
Pennsylvania Department of Banking, and the New Jersey Department of
Environmental Protection and Energy, if applicable, and all applicable statutory
waiting periods shall have expired except those approvals for which failure to
obtain would not have a materially adverse effect on SBI, FBC or FNB; (b) the
absence of any order, decree or injunction of a court or agency of competent
jurisdiction which enjoins or prohibits the consummation of the Farmers Merger
or the FNB Bank Acquisition, and the transactions contemplated by the Farmers
Merger Agreement, and the absence of any litigation or proceeding pending
against any of the parties or their subsidiaries by any governmental agency
seeking to prevent consummation of the transactions contemplated by the Farmers
Merger Agreement; (c) no enactment, promulgation or enforcement of any statute,
rule, regulation, order, injunction or decree by any governmental authority
which prohibits, restricts or makes illegal consummation of the FBC Merger or
the FNB Bank Acquisition; (d) all litigation which would have a material adverse
effect on FBC's consolidated operations shall have been concluded on terms
satisfactory to SBI, FBC and FNB; (e) Coopers & Lybrand, L.L.P. shall have
furnished to SBI an "agreed upon procedures" letter, dated the Farmers Effective
Date, to the effect that based upon procedures performed with respect to the
financial condition of FBC and FNB, nothing has come to their attention that
would indicate that, since the date of the most recent audited financial
statements, there has been a material adverse change in capital stock, long-term
debt or total or net assets and, as compared with the same period of the prior
year, there has been no material adverse change in the total or per share
amounts of income before extraordinary items or net income; (f) there shall not
have occurred any change in the financial condition, properties, assets,
business or results of operation of FBC or FNB which, individually or in the
aggregate, has had or might reasonably be expected to result in a material
adverse effect on FBC or FNB; (g) the shares of SBI Common Stock to be issued in
the Farmers Merger shall have been authorized to be listed on the NASDAQ NMS;
(h) a ruling from the Internal Revenue Service or an opinion of Morgan, Lewis
and Bockius LLP, counsel to SBI, shall have been received to the effect set
forth in the Farmers Merger Agreement; and (i) FBC shall have received an
updated opinion from its financial advisor, dated as of the date the Proxy
Statement/Prospectus described in the Farmers Merger Agreement is mailed to
FBC's shareholders, to the effect that the Farmers Merger is fair to FBC's
shareholders from a financial point of view. For purposes of the Farmers Merger
Agreement, in the case of FNB, receipt of a CAMEL rating in connection with a
safety and soundness examination which is lower than the rating
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given to FNB in connection with the safety and soundness examination most
recently reported prior to the date of the Farmers Merger Agreement shall be
deemed to have a material adverse effect on FNB.
Representations and Warranties.
The representations and warranties of SBI, SBI Merger Sub II, FBC
and FNB are set forth in Article III of the Farmers Merger Agreement. The
representations and warranties relate, among other things, to representations as
to corporate existence and authority and the ability of each party to carry out
the transactions as contemplated by the Farmers Merger Agreement. FBC and FNB
have made additional representations as to the non-existence of any contract
which would be breached by the Farmers Merger; the accuracy and completeness of
its financial statements and filings with federal or state regulatory agencies,
including state and federal tax filings; the absence of any material contracts
and certain other contracts; the absence of litigation not otherwise disclosed;
the absence of regulatory actions; the absence of undisclosed liabilities; labor
and employee benefits matters; the adequacy of its allowances for possible loan
losses; the condition of its tangible assets; assurances as to its loan
portfolio, on an adjusted bases; its compliance with applicable state and
federal laws on matters material to its operations; and environmental matters.
SBI has made additional representations as to the ownership by SBI of all of the
issued and outstanding shares of its bank subsidiaries; the accuracy and
completeness of published financial statements, filings with the Securities and
Exchange Commission and other federal or state regulatory agencies, and all
employee benefit plans; the non-existence of any contract which would be
breached by the Farmers Merger Agreement; the truthfulness and completeness of
all filings made by SBI with the Securities and Exchange Commission in
connection with the Farmers Merger Agreement and the transactions contemplated
by it except for information relating to FBC or FNB; the good standing and
adequate capitalization of SBI Merger Sub II; its compliance with applicable
state and federal laws on matters material to its operations; the absence of
regulatory actions; the absence of litigation not otherwise disclosed; the
absence of undisclosed liabilities; and environmental matters. On the Farmers
Effective Date, SBI, FBC and FNB must each present to the other certificates
evidencing the continued accuracy of the representations and warranties.
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Item 7. Financial Statements and Exhibits.
(c) Exhibits. Reference is made to the Exhibit Index annexed
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hereto and made a part hereof.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
SUSQUEHANNA BANCSHARES, INC.
Date: July 29, 1996 By: /s/ Robert S. Bolinger
-------------------------------
Robert S. Bolinger
President and Chief Executive
Officer
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EXHIBIT INDEX
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Exhibit
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2 Plan of Acquisition, Reorganization, Arrangement, Liquidation
or Succession
(a) Agreement and Plan of Affiliation Dated as of the
18th Day of July, 1996, By and Among Susquehanna
Bancshares, Inc., Susquehanna Bancshares East, Inc.,
Atcorp, Inc. and Equity National Bank
Schedule 1.2 Exchange Provisions
The Disclosure Schedules to the above-referenced
Agreement are omitted. Pursuant to paragraph (2) of Item
601(b) of Regulation S-K, the Registrant agrees to furnish
a copy of such schedules to the Commission upon request.
(b) Agreement and Plan of Affiliation Dated as of
the 18th Day of July, 1996, By and Among Susquehanna
Bancshares, Inc., Susquehanna Bancshares East II, Inc.,
Farmers Banc Corp. and Farmers National Bank
Schedule 1.2 Exchange Provisions
The Disclosure Schedules to the above-referenced
Agreement are omitted. Pursuant to paragraph (2) of Item
601(b) of Regulation S-K, the Registrant agrees to furnish
a copy of such schedules to the Commission upon request.
99 Press Release of the Registrant, Dated July 18, 1994, Regarding
the Execution of (1) the Atcorp Merger Agreement, and
(2) the Farmers Merger Agreement.
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