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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 02549
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): DECEMBER 19, 2002
SEACOAST FINANCIAL SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 000-25077 04-1659040
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
ONE COMPASS PLACE, NEW BEDFORD, MASSACHUSETTS 02740
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (508) 984-6000
NOT APPLICABLE
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
On December 19, 2002, Seacoast Financial Services Corporation, a
Massachusetts corporation ("Seacoast"), and Bay State Bancorp, Inc., a
Delaware corporation ("Bay State"), announced that they have entered into an
Agreement and Plan of Merger pursuant to which Seacoast will acquire Bay
State (the "Agreement"). The Agreement provides for the merger of Bay State
with and into a wholly owned subsidiary of Seacoast and the subsequent merger
of Bay State Federal Savings Bank with and into Compass Bank for Savings,
Seacoast's main banking subsidiary.
Pursuant to the Agreement, each share of Bay State common stock, par
value $0.01 per share, issued and outstanding immediately prior to the
effective time of the merger will be converted into the right to receive at
the election of the holder either (i) $27.00 in cash, without interest, (ii)
1.257 shares of Seacoast common stock, or (iii) a combination of Seacoast
common stock and cash, subject to the requirement that 55% of the Bay State
shares be exchanged for Seacoast stock. The Agreement contains allocation and
proration procedures to achieve this result. Bay State will have the ability
to terminate the Agreement if the price of Seacoast common stock declines by
more than 10% and underperforms a peer group of companies by more than 20%
over a designated measurement period unless Seacoast increases the exchange
ratio for converting shares of Bay State common stock to Seacoast stock in
accordance with a formula specified in the Agreement.
Consummation of the merger is subject to the satisfaction of certain
conditions, including approval of the Agreement by the stockholders of Bay
State and approval by the appropriate regulatory agencies. Officers and
directors of Bay State holding approximately 536,000 shares of Bay State
common stock have agreed to vote their shares in favor of the transaction.
The Agreement provides for a termination fee of $6.0 million. The
termination fee would be payable by Bay State in the event the Agreement is
terminated as a result of Bay State's willful or intentional breach of the
Agreement or if Bay State enters into an agreement for or consummates another
business combination or similar transaction with another party. The
termination fee would be payable by Seacoast in the event the Agreement is
terminated as a result of Seacoast's willful or intentional breach of the
Agreement.
The foregoing description is qualified in its entirety by reference to
the Agreement, a copy of which is attached hereto as Exhibit 2.1 and
incorporated by reference in response to this Item 5.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Not Applicable.
(b) Not Applicable.
(c) Exhibits: The following exhibits are filed as part of this
report:
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EXHIBIT NO. DESCRIPTION
2.1 Agreement and Plan of Merger, dated as of
December 19, 2002 by and between Seacoast
Financial Services Corporation, Seacoast Merger
Sub, Inc. and Bay State Bancorp, Inc.
10.1 Form of Voting Agreement (attached as Annex A
to Exhibit 2.1)
10.2 Payments and Waiver Agreement by and among
Seacoast Financial Services Corporation, Bay
State Bancorp, Inc., Bay State Federal Savings
Bank and John F. Murphy
10.3 Payments and Waiver Agreement by and among
Seacoast Financial Services Corporation, Bay
State Bancorp, Inc., Bay State Federal Savings
Bank and Denise Renaghan
10.4 Payments and Waiver Agreement by and among
Seacoast Financial Services Corporation, Bay
State Bancorp, Inc., Bay State Federal Savings
Bank and Michael Gilles
10.5 Consulting and Non-Competition Agreement
between Seacoast Financial Services Corporation
and John F. Murphy
10.6 Non-Competition Agreement between Seacoast
Financial Services Corporation and Denise
Renaghan
99.1 Press Release dated December 19, 2002.*
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* Incorporated by reference from Seacoast Financial's filing with the
Commission pursuant to Rule 425 under the Securities Act of 1933 on December
20, 2002.
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SIGNATURE
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, thereunto duly authorized.
SEACOAST FINANCIAL SERVICES CORPORATION
Dated: December 23, 2002 By: /s/ Kevin G. Champagne
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Kevin G. Champagne
President and Chief Executive Officer
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