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): April 6, 2000
Greater Bay Bancorp
(Exact name of registrant as specified in its charter)
California 77-0387041
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
Commission file number: 0-25034
2860 West Bayshore Road
Palo Alto, California 94303
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (650) 813-8200
Item 5. Other Events.
On December 14, 1999, Greater Bay Bancorp (the "Registrant") signed a
definitive agreement for a merger with Coast Bancorp ("Coast"), as a result of
which Coast Commercial Bank will become a wholly owned subsidiary of the
Registrant. On January 26, 2000, the Registrant signed a definitive agreement
with Bank of Santa Clara ("BSC") and GBB Merger Corp. providing for the merger
of GBB Merger Corp. with and into BSC, as a result of which BSC will become a
wholly owned subsidiary of the Registrant. On March 21, 2000, the Registrant
signed a definitive agreement with Bank of Petaluma ("BOP") and DKSS Corp.
providing for the merger of DKSS Corp. with and into BOP, as a result of which
BOP will become a wholly owned subsidiary of the Registrant.
The purpose of this Current Report on Form 8-K is to report the pro forma
financial information relating to these proposed mergers.
Pro Forma Financial Information
Included as Exhibit 99.1 of this Current Report on Form 8-K is unaudited
pro forma condensed combined financial information. The Unaudited Pro Forma
Condensed Combined Balance Sheet as of December 31, 1999 combines the historical
consolidated balance sheets of the Registrant, Coast, BSC and BOP, as if each of
these mergers had been effective on December 31, 1999, after giving effect to
certain adjustments. These adjustments are based on estimates. The Unaudited Pro
Forma Condensed Combined Statements of Operations for the years ended December
31, 1999, 1998 and 1997 present the combined results of operations of the
Registrant, Coast, BSC and BOP as if the mergers had been effective at the
beginning of each period. No assurance can be given when and if the proposed
mergers with Coast, BSC and BOP will be consummated.
The unaudited pro forma condensed combined financial information and
accompanying notes reflect the application of the pooling of interests method of
accounting for the mergers. Under this method of accounting, the recorded
assets, liabilities, shareholders' equity, income and expenses of the
Registrant, Coast, BSC and BOP are combined and reflected at their historical
amounts.
The pro forma combined figures shown in the unaudited pro forma condensed
combined financial information are simply arithmetical combinations of the
Registrant's, Coast's, BSC's and BOP's separate financial results; you should
not assume that the Registrant, Coast, BSC and BOP would have achieved the pro
forma combined results if they had actually been combined during the periods
presented.
The combined company expects to achieve merger benefits in the form of
operating cost savings. The pro forma earnings, which do not reflect any direct
costs or potential savings which are expected to result from the consolidation
of the operations of the Registrant, Coast, BSC and BOP are not indicative of
the results of future operations. No assurances can be given with respect to the
ultimate level of expense savings.
2
Pro Forma Earnings with Operating Efficiencies
The unaudited pro forma condensed combined financial information contained
in Exhibit 99.1 indicates that, for the year ended December 31, 1999, the
Registrant's diluted net earnings per share (before merger and other related
nonrecurring costs and extraordinary items) would have been $2.24, a decline of
$0.06 from the reported earnings before the mergers with Coast, BSC and BOP.
However, these pro forma earnings per share do not reflect the operating
efficiencies that the Registrant has realized in all of its previous mergers. On
average, the Registrant has realized operating efficiencies from its prior
mergers in excess of 15% of the operating expenses of the acquired institutions.
The following table details the impact of applying the Registrant's historical
percentage of operating efficiencies attained on a pro forma basis to
December 31, 1999 earnings (in thousands, except per share data):
Operating Net Diluted
Expenses Income (1) EPS (1)
----------------- --------------- -------------
Pro-Forma Net Income Before
Operating Efficiencies $113,074 $46,195 $2.24
Operating Expenses:
Coast 13,372 13,372
BSC 14,294 14,294
BOP 6,690 6,690
-------- -------
Total 34,356 34,356
Greater Bay Anticipated Merger & Acquisition
Operating Efficiencies 18.45% 18.45%
Estimated Operating Efficiencies, Gross 6,340 6,340
Estimated Operating Efficiencies, Net of Tax 3,680 3,680
-------- -------
Adjusted Pro-Forma Net Income After
Operating Efficiencies $109,394 $49,875 $2.39
======== =======
(1) - Before merger and other related nonrecurring costs and extraordinary
items.
No assurance can be given that these operating efficiencies will be
achieved. Information contained under this caption constitutes "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
which involve risks and uncertainties. The Registrant's actual results may
differ significantly from the results discussed in these forward-looking
statements. Factors that might cause such a difference include but are not
limited to difficulties in integrating the business of the newly acquired
institutions, the timing relating to achieving the operating efficiencies,
economic conditions, competition in the geographic and business areas in which
the Registrant conducts its operations and government regulation.
3
Item 7. Financial Statements and Exhibits.
Exhibits
- --------
99.1 Unaudited Pro Forma Condensed Combined Balance Sheet as of December 31,
1999 and Unaudited Pro Forma Condensed Combined Statements of Operations
for the years ended December 31, 1999, 1998 and 1997
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.
Greater Bay Bancorp
(Registrant)
Dated: April 6, 2000 By: /s/ Linda M. Iannone
--------------------
Linda M. Iannone
Senior Vice President and General Counsel
5