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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) October 10, 1995
UNITED COUNTIES BANCORPORATION
(Exact name of registrant as specified in its charter)
New Jersey
(State or other jurisdiction of incorporation)
0-11282 22-2453041
(Commission File Number) (IRS Employer Identification No.)
Four Commerce Drive, Cranford, New Jersey 07016
(Address of principal executive offices)
(908) 931-6600
(Registrant's telephone number, including area code)
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Item 5. Other Events.
On October 17, 1995 United Counties Bancorporation ("UCB")
announced that it will delay its Special Meeting of Stockholders
in order to provide its stockholders with additional information
concerning the recently announced merger agreement between
Meridian Bancorp, Inc. ("Meridian") and CoreStates Financial Corp
("CoreStates"). The Special Meeting has been called to vote on
the Agreement and Plan of Merger dated May 23, 1995 between UCB
and Meridian.
Under the UCB-Meridian Merger Agreement, UCB is to be merged
with and into Meridian, and UCB's banking subsidiary, United
Counties Trust Company, is to be merged into Meridian's New
Jersey banking subsidiary. In the merger, each share of UCB
common stock is to be exchanged for 5.00 shares of Meridian
common stock.
Pursuant to the Meridian-CoreStates Merger Agreement,
Meridian is to merge with CoreStates and each share of Meridian
common stock is to be exchanged for 1.225 shares of CoreStates
common stock.
UCB intends in the near future to forward to its
stockholders supplementary information about the proposed
Meridian-CoreStates merger and its effect on UCB stockholders.
UCB will also announce a revised meeting date as soon as the
supplementary information has been finalized.
UCB is a $1.6 billion bank holding company based in
Cranford, New Jersey, with 36 branches in Middlesex, Monmouth,
Morris, Somerset, and Union counties. Meridian is a $15 billion
diversified financial services holding company headquartered in
Reading, Pennsylvania, with over 300 branches throughout the
eastern half of Pennsylvania, central and southern New Jersey and
the state of Delaware. CoreStates is a $29 billion diversified
financial services holding company headquartered in Philadelphia,
Pennsylvania.
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Item 7. Exhibits.
99(a) Press Release of United Counties Bancorporation
dated October 17, 1995
99(b) Letter to Stockholders of United Counties
Bancorporation dated October 17, 1995
99(c) Joint Press Release of CoreStates Financial Corp
and Meridian Bancorp, Inc., dated October 10, 1995
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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 thereunto duly authorized.
UNITED COUNTIES BANCORPORATION
Dated: October 17, 1995 By: NICHOLAS A. FRUNGILLO, JR.
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Nicholas A. Frungillo, Jr.
Treasurer and
Chief Financial Officer
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INDEX TO EXHIBITS
99(a) Press Release of United Counties Bancorporation dated
October 17, 1995
99(b) Letter to Stockholders of United Counties
Bancorporation dated October 17, 1995
99(c) Joint Press Release of CoreStates Financial Corp and
Meridian Bancorp, Inc., dated October 10, 1995
EXHIBIT 99(a)
Cranford, New Jersey -- United Counties Bancorporation
(NASDAQ: UCTC) today announced that its Special Meeting of
Stockholders previously scheduled for November 1, 1995 will be
delayed in order to provide its stockholders with additional
information concerning the recently announced merger agreement
between Meridian Bancorp, Inc. (NASDAQ/NMS: MRDN) and CoreStates
Financial Corp (NYSE: CFL). The Special Meeting has been called
to vote on United Counties' merger agreement with Meridian.
Under the United Counties - Meridian merger agreement, each
share of common stock of United Counties is to be exchanged for
5.00 shares of Meridian common stock. United Counties
Bancorporation will be merged with and into Meridian Bancorp,
Inc., and its banking subsidiary, United Counties Trust Company,
will be merged into Meridian's New Jersey banking subsidiary.
In accordance with the Meridian - CoreStates merger
agreement, each share of Meridian common stock is to be exchanged
for 1.225 shares of CoreStates common stock. Assuming both
transactions are consummated, United Counties shares ultimately
would be converted into 6.125 shares of CoreStates common stock
for each share of United Counties common stock.
United Counties Bancorporation intends in the near future to
forward to its stockholders supplementary information about the
newly announced Meridian - CoreStates transaction and its effect
on United Counties stockholders. The Company will also announce
a revised meeting date as soon as the supplementary information
has been finalized.
United Counties Bancorporation is a $1.6 billion holding
bank company based in Cranford, New Jersey, with 36 branches in
Middlesex, Monmouth, Morris, Somerset, and Union counties.
Meridian Bancorp, Inc. is a $15 billion diversified financial
services holding company headquartered in Reading, Pennsylvania.
Meridian and CoreStates each have over 300 branches throughout
the eastern half of Pennsylvania, central and southern New
Jersey, and the state of Delaware. CoreStates is a $29 billion
diversified financial services holding company headquartered in
Philadelphia, Pennsylvania.
EXHIBIT 99(b)
Dear Stockholder:
As you have probably learned, Meridian Bancorp, Inc.
(Meridian) of Reading, Pennsylvania announced on October 10, 1995
the signing of a definitive merger agreement with CoreStates
Financial Corp (CoreStates) of Philadelphia, Pennsylvania. Under
the terms of this agreement, each share of Meridian common stock
will be exchanged for 1.225 shares of CoreStates common stock.
This contract, as envisioned, will have an impact on the
timing and financial outcome of your United Counties
Bancorporation merger transaction now in progress.
Your directors intend to delay the Special Meeting of
Stockholders scheduled for November 1, 1995 in order that the
information and financial data relating to the
Meridian/CoreStates transaction may be considered by the Board of
Directors of United Counties Bancorporation (UCB), our investment
advisors and by you.
The terms of the merger agreement between UCB and Meridian
stipulate an exchange ratio of five shares of Meridian common
stock for each share of UCB common stock. Assuming both merger
transactions are consummated, UCB stockholders who convert their
existing shares into shares of the surviving company would
ultimately received 6.125 shares of CoreStates common stock for
each share of UCB common stock.
As soon as more complete data regarding this new
Meridian/CoreStates merger agreement of which your Bancorporation
would become an integral part is available, we will forward
additional information to you and tell you the date of the
delayed meeting.
A copy of the Meridian/CoreStates joint press release
regarding their agreement is enclosed.
EXHIBIT 99(c)
Contact: CoreStates: Gary Brooten, (215) 973-3546
Meridian: George Biechler, (610) 655-2470
For Release: Immediately Upon Receipt
CoreStates and Meridian Agree to Combine;
Partnership Will Create a Regional Banking Power
Philadelphia, October 10, 1995 -- CoreStates Financial Corp
and Meridian Bancorp, Inc. today announced a definitive agreement
to merge. The combination would create a $45 billion asset
banking services power with leading geographic market positions
and specialized strengths in serving key regional, national and
global customer segments. It would also combine two strong-
performing banking companies, both of which reported record third
quarter earnings today. Specifically, the transaction would:
* Create a leading market position in a core region
blanketing the prime economic centers of eastern
Pennsylvania, northern Delaware and central New Jersey;
* Extend the combined banks' total market reach to 47
counties in the three states;
* Create a company with $3.7 billion of equity and with
the capital ratios to support investments in growth and
in improved services to customers;
* Be accretive to earnings per share for 1997;
* Combine two companies recognized for their community
leadership in and commitment to their markets.
"We are taking two organizations with deep historic roots in
this region and we are combining them into a single, focused
company with the knowledge, the commitment and the financial
resources to be an unparalleled resource to its customers and
communities," said Terrence A. Larsen, chairman and chief
executive of CoreStates.
"This is the time, this is the place, and this is the
specific opportunity to make a clear declaration. We will be the
'hometown' banking company for this region, offering local
decisions and local services with a global reach," he said.
"This combination will bring clear benefits to all stakeholders
of both organizations."
Samuel A. McCullough, chairman and chief executive of
Meridian, said, "The people of our two companies have worked
exceptionally hard and effectively to make us strong competitors
in our markets. This transaction will magnify the benefits of
those efforts for all of our stakeholders -- shareholders,
customers, employees and the communities we mutually serve. This
is the opening of an exciting new era for us."
The two leaders said each organization has long considered
the other as a key player and prime potential partner.
"It was quite natural for Meridian to explore a possible
combination with CoreStates as part of the Meridian board's
strategic study," said McCullough. "This combination will work
best for our region. It will assure our ability to serve our
customers superbly, and as partners we can strengthen our overall
commitments in helping to build the future of our communities."
Terms of the Transaction
The transaction would be a tax-free exchange of 1.225 shares
of CoreStates stock for each share of Meridian stock. Based on
closing share prices of October 9, 1995, the transaction would be
valued at approximately $3.2 billion. Accordingly Meridian
shareholders would receive $47.16 in CoreStates stock for each
Meridian share.
The deal is structured as an acquisition of Meridian by
CoreStates to be accounted for as a pooling of interests.
The merger, which is subject to approval by shareholders of
both companies and by regulators, is expected to close in the
second quarter of 1996.
As part of the agreement, Meridian and CoreStates gave each
other options to purchase 19.9% of their respective stock under
certain circumstances.
Management Team
Larsen, 49, will be chairman and chief executive officer of
the expanded CoreStates organization.
McCullough, 56, will be president and chief operating
officer of the corporation.
A new office of the Chairman will also include:
* Rosemarie B. Greco, 45, president and chief executive
officer of CoreStates Bank, N.A.
* Charles L. Coltman III, 53, vice chairman of the
corporation.
* Charles F. Connolly, Jr., 46, senior executive vice
president and chief risk management officer.
* Robert H. Gilmore, 47, chief processing service
officer.
* David M. Sparks, 51, chief financial officer.
Corporate headquarters will be in Philadelphia.
Third Quarter Earnings
Both CoreStates and Meridian issued summary reports of
record earnings for the third quarter and major progress on
implementing their respective process redesign/performance
improvement projects.
CoreStates reported net income of $133,946,000 or 96 cents
per share for the third quarter and $315,283,000 or $2.23 per
share for the first nine months. The nine-month figure included
a net 47 cents per share restructuring charge for CoreStates'
BEST process redesign project.
Larsen said the record third quarter earnings, up 28% from a
year earlier and representing an operating return on average
assets of 1.88% and return on average equity of 22.91%, reflected
both continuing strength in the company's basis businesses and
the growing impact of BEST on expenses.
He said the company was running ahead of schedule in
achieving the projected ultimate financial benefits of BEST, an
annualized 90 cents per share difference by the fourth quarter of
1996. The impact on third quarter earnings was 10 cents per
share, mostly in cost savings. The expense ratio declined to
53.7% for the quarter.
Meridian reported net income of $54.4 million, or 96 cents
per fully diluted share, for the third quarter and $121.5 million
or $2.14 per fully diluted share for the first nine months. The
nine-month figure included a 37 cents per share restructuring
charge in the second quarter for the 59.9 program.
McCullough said the third quarter earnings, up 52% from 1994
on a per share basis and representing a return on average assets
of 1.48% and return on equity of 17.33%, "reflect the underlying
strength of our core banking operations and the success of our
previously-announced '59.9' program designed to improve
Meridian's operating performance.
"We are especially pleased that the expense savings
identified by the '59.9' program are being realized ahead of
schedule," he said. Meridian's projected ultimate benefit from
59.9 is an annualized earnings improvement of 78 cents per share.
The 59.9 impact on net income for the third quarter was 11 cents
per share, all from cost savings. The bank reached an expense
ratio of 59.8% for the quarter.
Larsen and McCullough said the two organizations' projects
would continue on their implementation plans and that as they
plan consolidation "we expect to find ideas each is implementing
that can be extended to the other."
Strategic Fit and Integration Plans
The combination will be basically an in-market merger with
significant market overlaps, but the geographic market strengths
of the two companies differ. For businesses that depend on
branch office support, Meridian's strengths in Berks county and
the Lehigh Valley areas of eastern Pennsylvania and in Delaware
will complement CoreStates' already strong lead in the
metropolitan Philadelphia region and parts of central New Jersey.
Both companies are strong in the corporate "middle market",
defined by CoreStates as companies from $15 to $250 million
sales. In combination, they will have a commanding market
position in their core southeastern Pennsylvania region.
Meridian's recognized small business strengths complement
CoreStates' recently increased emphasis on serving this segment.
CoreStates brings great strengths in transaction processing
and international specialty services, while Meridian has special
strengths in segments of the trust and investment business.
The companies project that they will achieve merger cost
efficiencies, in addition to the BEST and 59.9 savings, at an
annual rate of approximately $186 million pre tax, by the time
consolidation and conversion is completed in late 1996.
CoreStates will incur a restructuring charge in the quarter of
closing of approximately $175 million pre-tax.
These efforts will include a branch network review expected
to result in consolidation, closing or sale of approximately 115
branch offices of the combined total of 667. The companies
projected that less than 10% of the combined totals of 19,127
positions would be eliminated. To reduce the numbers of
potential layoffs associated with the staff position cuts, the
two companies froze hiring except for critical positions.
Assuming closing as anticipated, the companies said they
expected consolidations to occur within 1996. Meridian expects
to close its pending acquisition of United Counties Trust Company
in New Jersey in the current quarter, and CoreStates expects to
carry out its planned consolidation of its New Jersey and
Pennsylvania banks as planned in January of 1996.
