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FILED BY SOUTHTRUST CORPORATION
PURSUANT TO RULE 425 OF THE
SECURITIES ACT OF 1933
SUBJECT COMPANY IS COMMUNITY
BANKSHARES, INCORPORATED
COMMISSION FILE NO. 0-13100
CONTACTS: DAVID OLIVER TIM SCHOOLS RAY FLEMING
SOUTHTRUST SOUTHTRUST COMMUNITY BANKSHARES
CORP. COMMUNICATIONS INVESTOR RELATIONS CHIEF FINANCIAL OFFICER
(205) 254-5523 (205) 254-6868 (804) 360-2222, EXT. 244
FOR IMMEDIATE RELEASE
SOUTHTRUST, COMMUNITY BANKSHARES SIGN DEFINITIVE AGREEMENT
BIRMINGHAM, Ala., and RICHMOND, Va. (September 21, 2001) -- Officials with
SouthTrust Corporation (NASDAQ: SOTR) and Community Bankshares Incorporated
(NASDAQ: CBIV) based in Richmond, Va., have signed a definitive agreement for
the acquisition of Community Bankshares by SouthTrust. Wallace D. Malone Jr.,
chairman and chief executive officer of SouthTrust Corp., and Nathan S. Jones
3rd, president and chief executive officer of Community Bankshares, made the
announcement.
The definitive agreement provides for the merger of Commerce Bank, the
subsidiary of Community Bankshares, with SouthTrust Bank. Commerce Bank operates
13 offices in the Virginia cities of Richmond, Petersburg and Colonial Heights,
and in Chesterfield, Henrico, Hanover and Goochland counties. The company
reported assets of $416 million as of June 30, 2001. The merger calls for the
exchange of 1.5608 shares of SouthTrust stock for each outstanding share of
Community Bankshares stock. Community Bankshares' shareholders will have the
right to exchange up to 40% of the total outstanding shares for $34.03 per share
in cash.
The agreement is subject to certain conditions, including shareholder
and regulatory approval.
The agreement further provides for an alternative deal structure that
would make the transaction an all cash transaction if the exchange ratio
multiplied by the five-day average of the market price of SouthTrust's common
stock is less than $23.41 per share five days before the Community Bankshares'
shareholder meeting. The cash purchase
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price would be a weighted average of $34.03, weighted at 40%, and the product of
the market value of SouthTrust's common stock and the exchange ratio, weighted
at 60%.
This transaction represents SouthTrust Bank's third acquisition
announcement in Virginia this year. Bank officials anticipate closing on this
transaction during the fourth quarter 2001. SouthTrust will communicate directly
to customers about any changes to accounts, products, services, bank hours and
bank operations as the conversion process continues.
"We are excited about this agreement with Community Bankshares and
Commerce Bank," Malone said. "2001 has been an exciting year for SouthTrust in
the state of Virginia, and we are especially delighted with this merger as it
marks
SouthTrust's initial retail banking entry into the Richmond area. We look
forward to working with many customers and employees of Commerce Bank. We will
continue to provide these customers the quality service they have come to
know and expect from their bank, along with new products and services."
"We are pleased about becoming part of SouthTrust," said Nathan S.
Jones 3rd, chief executive officer of Commerce Bank. "We will continue to
provide the wide range of commercial banking services to individuals, small to
medium-sized businesses, institutions and governments that Commerce Bank
customers have come to know, as well as broaden and deepen this product offering
through SouthTrust."
Community Bankshares was advised by Keefe, Bruyette & Woods, Inc. and
McKinnon & Company, Inc.
SouthTrust Corporation (www.southtrust.com) is a $47-billion regional
bank holding company with headquarters in Birmingham, Ala. SouthTrust operates
more than 650 banking offices and 800 ATMs in Alabama, Florida, Georgia,
Mississippi, North Carolina, South Carolina, Tennessee, Texas and Virginia. The
company offers a complete line of banking and other related financial services
to commercial and retail customers.
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SouthTrust is a Forbes Platinum 400 and FORTUNE 500 company that trades on the
NASDAQ Stock Market under the symbol SOTR and is included in the S&P 500 index.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Statements made in this press release, other than those containing historical
information, are forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Act of 1995. Such statements
involve risks and uncertainties that may cause results to differ materially from
those set forth in these statements. SouthTrust and Community Bankshares wish to
caution readers that results and events subject to forward-looking statements
could differ materially due to the following factors: possible changes in
regional and national economic and business conditions; changes in levels of
market interest rates, credit risks of lending activities and competitive and
regulatory factors; possible changes in monetary and fiscal policies, laws and
regulations; and the effects or other risks and factors identified in the
companies' filings with the Securities and Exchange Commission. The parties do
not undertake, and specifically disclaim, any obligation to publicly release the
result of any revisions which may be made to any forward-looking statements to
reflect the occurrence of anticipated or unanticipated events or circumstances
after the date of such statements.
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