1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 29, 2000
COMMUNITY BANK SYSTEM, INC.
---------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-11716 16-1213679
- ---------------------------- ------------------------ ---------------------
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.
5790 Widewaters Parkway, DeWitt, New York 13214 13214
- ------------------------------------------------------- ---------------------
(Address of Principal Executive Offices) (Zip code)
________________________________
(Former Name or Former Address, if Changed Since Last Report)
2
ITEM 5. OTHER EVENTS.
On November 29, 2000, Community Bank System, Inc. (the "Company") entered
into an Agreement and Plan of Merger (the "Merger Agreement") with First
Liberty Bank Corp., a bank holding company based in Jermyn, Pennsylvania
("First Liberty"). Pursuant to the Merger Agreement, subject to the
satisfaction of a number of conditions, First Liberty will merge (the "Merger")
with and into the Company, with the Company being the surviving corporation, to
create a bank holding company with consolidated assets of approximately $2.8
billion (assuming the completion of the pending merger between the Company's
bank subsidiary, Community Bank, N.A. (the "Bank"), and The Citizens National
Bank of Malone). Following the Merger, the Company expects to merge First
Liberty's bank subsidiary, First Liberty Bank & Trust ("First Liberty Bank"),
with and into the Bank, with the Bank being the continuing bank.
First Liberty Bank, a Pennsylvania state-chartered commercial bank with
trust powers, operates 13 banking offices in Lackawanna and Luzerne Counties in
Pennsylvania. At September 30, 2000, First Liberty had approximately $647
million in total assets, $497 million in total deposits, $429 million in total
net loans and shareholders' equity of $60 million. First Liberty's common stock
is registered pursuant to Section 12(g) of the Securities Exchange Act of 1934,
as amended (File No. 000-13312). Accordingly, First Liberty files reports,
statements and other information with the Securities and Exchange Commission
(the "Commission"), which contain additional information concerning First
Liberty. These reports, statements and other information are available from the
Commission.
Each share of First Liberty's common stock issued and outstanding at the
time the Merger is consummated will be converted into 0.56 of a share of common
stock of the Company and cash in lieu of fractional shares, if any. The Company
also agreed to assume outstanding stock options to purchase shares of First
Liberty's common stock. Based on the number of shares of First Liberty's common
stock and stock options issued and outstanding on November 29, 2000, the Company
will issue approximately 3.6 million shares of its common stock and assume
options to purchase approximately 44,000 shares of its common stock upon
consummation of the Merger. The Merger is intended to constitute a tax-free
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended, and to qualify for accounting treatment as a pooling of
interests.
In the Merger Agreement, the Company agreed to elect three of the current
directors of First Liberty, namely Saul Kaplan, Peter A. Sabia and Harold
Kaplan, to the Boards of Directors of the Company and the Bank. It is a
condition to closing that each of Steven R. Tokach and Joseph R. Solfanelli,
officers of First Liberty, enters into an employment agreement with the Company,
pursuant to which Mr. Tokach will serve as President and Chief Executive Officer
of the division of the Bank operating in the market areas in Pennsylvania
previously served by the First Liberty Bank, and Mr. Solfanelli will serve as
Executive Vice President and Chief Legal Officer of such division. In addition,
William M. Davis, President of First Liberty, is expected to serve as a
consultant to the Bank to assist in the integration of the two companies and to
promote the business of the Bank in the market areas formerly served by First
Liberty. The Company also agreed to establish a nine-member advisory board,
consisting of eight of the current directors of First Liberty and Sanford A.
Belden, President and Chief Executive Officer of the
3
Company, to advise on matters relating to the markets previously served by
First Liberty.
In connection with the execution and delivery of the Merger Agreement,
First Liberty granted the Company a stock option to acquire, under certain
conditions, up to 19.9% of the issued and outstanding shares of common stock of
First Liberty. In addition, each director and executive officer of First Liberty
has entered into an agreement which requires him to vote in favor of the
approval of the Merger Agreement and the Merger all of the shares of First
Liberty's common stock that he is entitled to vote.
Consummation of the Merger is subject to a number of conditions, including
the receipt of regulatory approvals and the approval of the respective
stockholders of the Company and First Liberty. Subject to the satisfaction of
all conditions, the parties are working to complete the Merger in the second
quarter of 2001.
The foregoing descriptions of and references to all of the above-mentioned
agreements are qualified in their entirety by reference to the complete texts
of the agreements that are filed herewith and incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
Exhibit No. Description
- ----------- -----------
2.1 Agreement and Plan of Merger, dated November 29, 2000, by and
between Community Bank System, Inc. and First Liberty Bank Corp.
99.1 Form of Voting Agreement, dated November 29, 2000, by and
between Community Bank System, Inc. and directors and executive
officers of First Liberty Bank Corp.
99.2 Stock Option Agreement, dated November 29, 2000 by and between
Community Bank System, Inc. and First Liberty Bank Corp.
99.3 Joint Press Release, dated November 29, 2000, issued by
Community Bank System, Inc. and First Liberty Bank Corp.(1)
- -----------------------
(1) Incorporated herein by reference to a copy thereof filed by Community Bank
System on November 30, 2000, pursuant to Rule 425 under the Securities Act
of 1933, as amended.
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
COMMUNITY BANK SYSTEM, INC.
Date: December 6, 2000
By: /s/ Sanford A. Belden
------------------------------------
Name: Sanford A. Belden
Title: President and Chief Executive Officer