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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): March 15, 2000
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Frontier Financial Corporation
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(Exact Name of Registrant as Specified in Charter)
Washington 0-15540 91-1223535
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(State or other jurisdiction (Commission (IRS Employer Identi-
of incorporation) File Number) fication Number)
332 SW Everett Mall Way, Everett, Washington 98204
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(Address of principal executive offices/Zip Code)
Registrant's telephone number, including area code: (425) 514-0700
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ITEM 5. Other Events
On March 15, 2000, Frontier Financial Corporation ("Frontier") and its
wholly-owned subsidiary, Frontier Bank, entered into an Agreement and Plan of
Mergers ("Agreement") with Liberty Bay Financial Corporation ("Liberty") and its
wholly-owned subsidiary, North Sound Bank, pursuant to which Frontier will
acquire all of the outstanding stock of Liberty. The Agreement provides that
shareholders of Liberty will receive 10.5 shares of Frontier common stock for
each share of Liberty common stock. Frontier will also assume all outstanding
Liberty employee stock options. Frontier anticipates issuing a maximum of
2,423,904 shares of common stock in the transaction. The transaction will be
accounted for using the pooling of interests method of accounting.
Consummation of the acquisition is subject to several conditions,
including receipt of applicable regulatory approval, and approval by Liberty's
shareholders. For information regarding the proposed transaction, reference is
made to the press release dated March 15, 2000, which is attached hereto as
Exhibit 99 and incorporated herein by reference.
ITEM 7. Financial Statements, Pro Forma Financial Information And Exhibits
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(a) Financial statements - not applicable.
(b) Pro forma financial information - not applicable.
(c) Exhibits:
99 Press Release
SIGNATURES
Pursuant to the requirements of the security Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: March 16, 2000
FRONTIER FINANCIAL CORPORATION
By: /s/ Robert J. Dickson
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Its: Chief Executive Officer
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FRONTIER FINANCIAL CORPORATION Contact:
332 SW Everett Mall Way Robert J. Dickson
Everett, WA 98204 President & CEO
(425) 514-0700
NEWS RELEASE
For Release March 15, 2000, 6:30 P.M. PST
FRONTIER FINANCIAL CORPORATION AND
LIBERTY BAY FINANCIAL TO MERGE
EVERETT, WASHINGTON - March 15, 2000 - The Board of Directors of Frontier
Financial Corporation (NASDAQ:FTBK), today announced the signing of a definitive
agreement to acquire Liberty Bay Financial Corporation of Poulsbo, Washington
and its subsidiary, North Sound Bank.
North Sound Bank operates eight banking offices on the Olympic Peninsula
including two offices in Poulsbo and single offices in Port Angeles, Silverdale,
Port Hadlock, Bainbridge Island, Port Townsend, and Sequim.
Liberty Bay had total consolidated assets of $180 million and shareowner's
equity of $20.9 million as of December 31, 1999. For the year ended December 31,
1999, Liberty Bay had net income of 2.6 million, representing a return on
average assets of 1.5% and a return on average shareowners' equity of 14%.
Shareowners of Liberty Bay will receive 10.5 shares of Frontier common
stock for each share of Liberty Bay stock outstanding. Based on the current
price of Frontier common stock of $18.00 per share, the transaction is valued at
approximately $39.7 million, not including the value of outstanding stock
options. The transaction is approximately 1.9 times Liberty Bay's book value as
of December 31, 1999 and approximately 15.1 times 1999 net income. It is
expected the transaction will be accretive to Frontier during the first year.
The transaction has been approved by the Boards of Directors of both
companies. It is anticipated that the merger will be completed during the third
quarter of 2000, following the approval by applicable regulatory authorities and
the shareowners of Liberty Bay Financial. Upon completion, Liberty Bay Financial
Corporation will be merged into Frontier Financial Corporation and North Sound
Bank will be merged into Frontier Bank. Michael Clementz, Chairman and CEO of
North Sound Bank, will be named Executive Vice President and part of the
management team of Frontier. Mr. Clementz will also serve as a director of
Frontier. Rob Robinson, President of North Sound Bank, will be named a Senior
Vice President of Frontier with operational responsibility for the eight
peninsula offices. The transaction will be accounted for using the "pooling of
interests" method.
Clementz stated "Liberty Bay shareowners will benefit from increased stock
liquidity, higher cash dividends and greater shareowner value. Customers will
enjoy an expanded range of financial expertise, products and services. Employees
will experience new career opportunities that only a larger organization can
offer. Finally, the combined company will be significantly enriched by its
increased competitive position within the market we serve".
(more)
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Frontier President and CEO, Bob Dickson, responded by saying, "It is
exciting to merge two outstanding organizations, with each having a focus of
providing outstanding customer service. Continued changes in banking,
particularly the cost of technology needed to provide the most up to date
client services was a driver in the decision to expand our franchise. The added
technology costs can now be spread over a larger base. Both organizations are
people focused, both customer and employee, and believe in being good community
citizens".
This will be the sixth merger for Frontier which opened in 1978. At
completion, Frontier will have total assets in excess of $1.5 billion,
approximately 500 employees in 33 branches located in eight western Washington
counties. In 1999, US Banker magazine rated Frontier Bank the #1 mid-sized bank
in the nation based on operating performance.
Frontier Financial Corporation headquartered in Everett, Washington, is
the parent of Frontier Bank which operates twenty-five banking offices in King,
Pierce, Skagit, Snohomish and Whatcom counties.
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Information herein contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, which can be identified
by words such as "may", "expected", "anticipate", "estimate", "continue" or
comparable words. In addition, all statements other than statements of
historical facts that address activities that Frontier expects or anticipates
will or may occur in the future are forward-looking statements. Readers are
encouraged to read the SEC reports of Frontier particularly its Form 10-K for
the Fiscal Year Ended December 31, 1998, for meaningful cautionary language
discussing why actual results may vary materially from those anticipated by
management.
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