SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): August 21, 1998
HERITAGE FINANCIAL CORPORATION
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(Exact name of registrant as specified in its charter)
WASHINGTON 0-29480 91-1857900
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(State or other jurisdiction (Commission IRS Employer
of incorporation) File Number) Identification No.
205 Fifth Avenue S.W.
Olympia, WA 98501
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(Address of principal executive offices: (Zip Code)
Registrant's telephone number, including area code: (360) 943-1500
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ITEM 5 - OTHER EVENTS
On August 17, 1998, Heritage Financial Corporation, Olympia, Washington
("Heritage") entered into an Agreement and Plan of Merger (the "Agreement") with
Harbor Bancorp, Inc. ("Harbor") and its wholly-owned subsidiary, The Bank of
Gray's Harbor ("Bank"). Under the terms of the Agreement, Heritage and Harbor
will merge with Heritage surviving the merger. The Bank will become a separate
wholly-owned commercial bank subsidiary of Heritage. The Agreement was approved
unanimously by the boards of directors of Heritage, Harbor and the Bank.
The Agreement provides that each share of outstanding common stock of
Harbor is to be converted into $155.00 worth of shares of Heritage common stock
based on the average trading price of Heritage common stock for a 45 day period
ending 5 days prior to closing. In addition, each outstanding option to acquire
a share of Harbor common stock will be converted into shares of Heritage common
stock pursuant to a pricing formula described in the Agreement. The number of
shares of Heritage common stock to be issued in the merger will vary depending
upon the average trading price of Heritage common stock subject to a "collar"
price of $13.75 and a "cuff" price of $12.25. Harbor may terminate the Agreement
if the average trading price of Heritage common stock falls below $11.25 during
the 45 day trading period described above unless Heritage increases the number
of shares it will issue in the merger as provided in the Agreement.
Consummation of the acquisition is subject to several conditions,
including, among other things, receipt of applicable regulatory approvals,
approvals by shareholders of Heritage and Harbor, and the receipt of fairness
opinions. The transaction is expected to be completed by January 1, 1999. For
information regarding the terms of the proposed transaction, reference is made
to the Agreement and the news release dated August 17, 1998, which are attached
hereto as Exhibits 2 and 99, respectively.
ITEM 7 - FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements--not applicable.
(b) Pro forma financial information--not applicable.
(c) Exhibits:
2 Agreement and Plan of Merger dated August 17, 1998
99 News Release issued by Heritage, dated August 17, 1998
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: August 21, 1998
HERITAGE FINANCIAL CORPORATION
By: /s/ Donald V. Rhodes
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Donald V. Rhodes
Chairman, President
and Chief Executive Officer