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U.S. 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: May 19, 1999
VALLEY NATIONAL CORPORATION
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(Name of small business issuer in its charter)
IRS EMPLOYER ID. NO. 33-0825336
1234 EAST MAIN STREET, EL CAJON, CALIFORNIA 92021
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(Address of principal executive offices)
ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE: (619) 593-3330
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ITEM 5. OTHER EVENTS
On May 10, 1999 a press release was issued stating that Valley National
Corporation and its subsidiary, Valle de Oro Bank, N.A., entered into a
definitive agreement to merge with Community First Bankshares, a $5.9 billion
bank holding company in Fargo, North Dakota. A copy of the press release is
filed as Exhibit 99.1 hereto, which is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) The following exhibit is filed herewith:
EXHIBIT NUMBER DESCRIPTION
99.1 Press release of registrant dated May 10, 1999.
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SIGNATURES
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, hereunto duly authorized.
Valley National Corporation
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Registrant
Date: May 19, 1999
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/s/ Paul M. Cable
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Paul M. Cable,
Senior Vice President and Chief Financial Officer
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EXHIBIT 99.1
FOR ADDITIONAL INFORMATION CONTACT:
FOR IMMEDIATE RELEASE REBECCA WALL, DIRECTOR OF MARKETING
Valle de Oro Bank, El Cajon (619) 593-3330
VALLE DE ORO BANK SIGNS AGREEMENT TO MERGE
WITH COMMUNITY FIRST BANKSHARES
MAY 10, 1999, EL CAJON CA - Valley National Corporation and its subsidiary bank
Valle de Oro Bank, N.A. (NASDAQ: VADO) will merge with Community First
Bankshares, Inc. (NASDAQ: CFBX), the two companies announced today. Community
First Bankshares is a $5.9 billion bank holding company that serves 154 markets
in 11 states and specializes in community banking. Valle de Oro Bank has $241
million in assets and $220 million in deposits with six San Diego-area banking
locations in four markets: El Cajon, La Mesa, Santee and Spring Valley, CA.
Under the terms of a definitive agreement effective today, Valley National
Corporation, the parent company of Valle de Oro Bank, will be merged with
Community First. The merger, which remains subject to due diligence by both
banks and regulatory and stockholder approval, is not anticipated to close until
October 31, 1999. The merger will provide Community First with entry into the
California marketplace, and Valle de Oro Bank will provide the charter and
management to create a much larger presence in the state.
The definitive agreement calls for an exchange of shares in which Valley
National stockholders will receive a fixed price of $65 million, or
approximately 3.25 times Valley National's targeted book value, subject to
certain changes in the price of Community First Shares. At Community First's
recent price of $20 per share, Valley National stockholders would receive
approximately one share of Community First stock for each share of Valley
National after adjusting for recent stock dividends.
"We are extremely pleased with this merger," said William V. Ehlen, Valle de Oro
Bank president. "Community First is a bank I have known for several years, and
their commitment to community banking matches our own. This merger will have
the least amount of impact upon Valle de Oro bankers, and it will be virtually
transparent to customers. In fact, customers will benefit the most because of
the enhanced products and services.
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The merger with Valle de Oro Bank provides Community First with its initial
entry into the coveted California banking marketplace. "Our local
relationship-focused service and our wide array of financial products reinforces
our dedication to making a better financial tomorrow for our customers," said
Donald R. Mengedoth, Community First president and CEO. We at Community First
look forward to bringing this style of community banking to the state of
California." Another benefit of this merger is Community First's opportunity to
expand its product offerings. Valle de Oro Bank has recently joined the ranks
of technically advanced banking through the introduction of PC Banking to its
product line. "We view this alternative distribution channel as a positive
interim step towards our ultimate goal of full Internet banking in 2000." said
Mengedoth.
The quality of Valle de Oro Bank management was an important consideration in
Community First's decision to acquire the San Diego area community bank. Ehlen
and Mengedoth have known each other for several years through national trade
association activities. Ehlen is well acquainted with the California banking
industry, and he is president-elect for the Western Independent Bankers, an
association of 253 community banks in nine Western states.
"Bill's reputation in the California marketplace will allow Community First to
rapidly expand our franchise," said Mengedoth who is also president elect of the
American Bankers Association. "This acquisition of Valle de Oro Bank marks our
initial entry into California and with Bill's leadership we look forward to many
others."
"This is a terrific opportunity for Valle de Oro bankers to be a part of a much
larger and stronger California bank while still having the friendliness and
local decision-making that sets community banks apart," said Ehlen.
"Stockholders will like the transaction because they get an excellent price in a
stock with great potential, and they know that they will still see the same
lenders and tellers when they do their banking."
The transaction, which requires a "pooling of interests" method of accounting,
will take several months to complete. Due diligence investigations by the banks
are contemplated to be finished in early June. Approvals of banking regulators
require several months. Valley National stockholders are expected to receive
proxy materials and vote upon the proposal in late summer. The transaction,
which has been unanimously approved by Valley National's board of directors,
requires a simple shareholder majority to approve.
Valley National Corporation was formed recently as a bank holding company for
Valle de Oro Bank with an eye to similar expansion plans. "Sometimes the best
deals come along when you least expect them," said Ehlen. "This makes sense
because we share a common vision. We can team up with their strength and
experience while providing our stockholders and customers value enhancements at
the same time."
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Community First Bankshares, headquartered in Fargo, N.D., is a $5.9 billion
multi-bank holding company, which operates full-service banking offices in 154
communities in Arizona, Colorado, Iowa, Minnesota, Nebraska, New Mexico, North
Dakota, South Dakota, Utah, Wisconsin and Wyoming. In addition to banking, the
Company offers a diverse array of financial services, including investment,
insurance, mortgage and trust, with a focus on small business lending. The
Company is the number one or two market dominant bank in a majority of the
communities it serves. Community First's common stock is traded on the NASDAQ
Stock Market under the symbol CFBX. The latest investor and corporate
information is available online via the Internet, at its web site,
http://www.cfbx.com. Information regarding Valle de Oro Bank can also be
found at its web site, http://wwwvalledeorobank.com
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This press release contains forward-looking statements under the Private
Securities Litigation Reform Act of 1995 that are subject to certain risks and
uncertainties that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. The company
wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Factors that
could cause actual results to differ from the results discussed in the
forward-looking statements include, but are not limited to: risks related to the
company's acquisition strategy, including risks of adversely changing results of
operations and factors affecting the company's ability to consummate further
acquisitions; risks of loans and investments, including dependence on local
economic conditions; competition for the company's customers from other
providers of financial services; possible adverse effects of changes in interest
rates; and other risks detailed in the company's filings with the Securities and
Exchange Commission, all of which are difficult to predict and many of which are
beyond the control of the company.
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