UNITED STATES
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
January 12, 1996
Date of Report (Date of earliest event reported)
Community Banks, Inc.
(Exact name of registrant as specified in its charter)
Pennsylvania 0-15786 23-2251762
(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File Number) ID No.)
150 Market Street
Millersburg, Pennsylvania 17061
(Address of principal executive offices) (Zip Code)
(717) 692-4781
(registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
Item 2. Acquisition or Disposition of Assets.
On January 12, 1996 (the "Effective Date")
Registrant acquired The Citizens' National Bank of Ashland
("Citizens") by means of the merger (the "Merger) of
Citizens into Community Banks, National Association
("CBNA"), the wholly owned banking subsidiary of Registrant.
The merger was affected pursuant to an Agreement and Plan of
Merger dated July 5, 1995 (the "Merger Agreement") between
Registrant and Citizens.
Pursuant to the terms of the Merger Agreement, on
the Effective Date, each share of Citizens' common stock,
par value of $20.00, issued and outstanding was converted
into the right to receive shares of the Registrant's common
stock, $5.00 par value, as determined by the Merger
Agreement. The exchange ratio value of $770.00 per common
share of Citizens was based on the average closing price of
the Registrant's common stock during the 30 business day
period prior to five days before the merger and subject to
the minimum and maximum values of $24.675 and $27.825,
respectively.
In the Merger, 19,994.5 shares of Citizens
outstanding common stock were exchanged for common stock of
Registrant in the ratio of 28.912 shares of Registrant's
common stock for each share of Citizens common stock (an
aggregate of 578,081 shares of Registrant's common stock).
The remaining 5.5 shares of Citizens' outstanding common
stock which represented fractional shares were exchanged for
cash in the amount of $770.00 per share (an aggregate of
$4,235). Funds needed to pay the cash portion of the
purchase price were obtained internally by liquidation of
short-term investments. The total consideration associated
with the Merger was $15,400,266.
Within ten business days after the Effective Date,
Registrant sent to each person who on the Effective Date was
a holder of record of Citizens' common stock transmittal
materials and instructions for surrendering certificates for
Citizens' common stock in exchange for the number of whole
shares of Registrant's common stock to which such person is
entitled pursuant to the exchange ratio. No certificates for
fractional shares of Registrant's common stock will be
issued. Registrant will furnish to any holder of common
stock entitled to a fractional share a check for an amount
of cash equal to the fraction of a share of Registrant's
common stock represented by the certificates so surrendered
in accordance with the exchange ratio.
There were no relationships, material or otherwise,
between Citizens and the Registrant or any of the
Registrant's affiliates, or any director or officer of the
Registrant, or any associate of any such director or officer
prior to the Effective Date. In accordance with the Merger
Agreement, Mr. Dean N. Paul, Cashier of Citizens, will be
named to CBNA's Board of Directors.
For additional information regarding the Merger,
Citizens and the Merger Agreement, reference is made to the
Proxy Statement dated November 1, 1995 included in
Registrant's Registration Statement No. 33-63239 on Form S-4
dated October 6, 1995.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements:
Pursuant to Item 7(a)(4) of Form 8-K, Registrant is
not providing the required financial statements with this
Current Report on Form 8-K because to do so would be
impracticable. The Registrant will file such financial
information as can be generated within the 60 day period
following the date by which this Current Report on Form 8-K
must be filed as provided in Item 7(a)(4).
(b) Pro Forma Financial Information
Pursuant to Item 7(a)(4) of Form 8-K, Registrant is
not providing the required financial statements with this
Current Report on Form 8-K because to do so would be
impracticable. The Registrant will file such financial
information as can be generated with the 60 day period
following the date by which this Current Report on Form 8-K
must be filed as provided in Item 7(a)(4).
(c) Exhibits:
(2) Plan of Acquisition, Reorganization,
Arrangement, Liquidation or Succession.
Incorporated by reference is the Proxy Statement
dated November 1, 1995 included in Registrant's Registration
Statement No. 33-63239 on Form S-4 dated October 6, 1995.
(28) Additional Exhibits.
The press release of the Registrant dated January
12, 1996, regarding consummation of the Merger is included
on page 4.
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.
Community Banks, Inc.
Date: January 18, 1996 By:/s/ Terry L. Burrows
Terry L. Burrows
Executive Vice President
Chief Financial Officer
COMMUNITY BANKS, INC.
FOR IMMEDIATE RELEASE:
Millersburg, Pennsylvania Date: January 12, 1996
Exhibit 28
COMMUNITY BANKS, INC.
ANNOUNCES COMPLETION OF THE MERGER OF
THE CITIZENS NATIONAL BANK OF ASHLAND, PENNSYLVANIA
BY COMMUNITY BANKS, NATIONAL ASSOCIATION
ITS WHOLLY-OWNED NATIONAL BANKING SUBSIDIARY
Community Banks, Inc., Millersburg, Pennsylvania
(Community) (NASDAQ NMS:CBKI) announced today the merger of
The Citizens National Bank of Ashland, Pennsylvania
(Citizens) into Community Banks, National Association
(CBNA), Community's wholly-owned national banking
subsidiary.
The merger was concluded at 3:00 P.M. on January
12, 1996 through the exchange of shares of Community common
stock for all of the outstanding capital stock of Citizens.
Citizens' shareholders will receive 28.912 shares of
Community common stock for each share of Citizens stock that
they held as of January 12. The main office of Citizens and
its two branch offices will be operated as branches of CBNA.
Community is a bank holding company and parent of
CBNA. Community's common stock is listed on the NASDAQ
National Market System under the symbol CBKI. CBNA now has
21 community banking offices throughout Dauphin,
Northumberland, Schuylkill, and Luzerne Counties,
Pennsylvania, with combined assets of 380 million dollars.
For further information contact: Thomas L. Miller
Chairman & CEO
Community Banks, Inc.
717-692-4781
