<PAGE>
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): May 18, 2000
Greater Bay Bancorp
(Exact name of registrant as specified in its charter)
California 77-0387041
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
Commission file number: 0-25034
2860 West Bayshore Road
Palo Alto, California 94303
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (650) 813-8200
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On May 18, 2000, Coast Bancorp ("Coast") merged (the "Merger") with and
into Greater Bay Bancorp (the "Registrant") pursuant to the an Agreement and
Plan of Reorganization, dated as of December 14, 1999, by and between Coast and
the Registrant (the "Agreement"). In accordance with the Agreement, former
shareholders of Coast received approximately 3,070,000 shares of the
Registrant's common stock in exchange for each of their shares of Coast common
stock. As a result of the Merger, Coast Commercial Bank ("CCB"), formerly a
wholly owned subsidiary of Coast, became a wholly owned subsidiary of the
Registrant. The Merger was accounted for as a pooling of interests.
As of March 31, 2000, CCB had 6 banking offices located in Aptos, Capitola,
Santa Cruz, Scotts Valley and Watsonville, California, with total assets of
$409.6 million, total deposits of $313.6 million and total loans of $216.9
million. CCB will continue to conduct its banking operations at all of these
locations after the Merger.
In connection with the Merger, James Thompson, the Chairman of the Board of
CCB, was appointed to the Board of Directors of GBB. In addition, David
Kalkbrenner, President and Chief Executive Officer of GBB, was appointed to the
Board of Directors of CCB.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
Coast Bancorp Annual Report on Form 10-K for the year ended December
31, 1999, Commission file number 0-28938, filed on March 3, 2000, as
amended by Form 10-K/A filed on April 6, 2000, is incorporated herein
by this reference.
Coast Bancorp Quarterly Report on Form 10-Q for the quarter ended
March 31, 2000, Commission filed number 0-28938, filed on April 28,
2000, is incorporated herein by this reference.
(b) Pro forma financial information.
Index to pro forma financial information:
Pro forma Condensed Combined Balance Sheet as of March 31, 2000
Pro forma Condensed Combined Statements of Operations for the
three months ended March 31, 2000 and 1999 and for the year ended
December 31, 1999
(c) Exhibits.
23 Consent of Deloitte & Touche LLP, Independent Auditors of Coast
2
<PAGE>
99.1 Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31,
2000 and unaudited Pro Forma Condensed Combined Statements of
Operations for the three months ended March 31, 2000 and 1999 and for
the year ended December 31, 1999
Pro Forma Financial Information
Included as Exhibit 99.1 of this Current Report on Form 8-K is unaudited
pro forma condensed combined financial information. The Unaudited Pro Forma
Condensed Combined Balance Sheet as of March 31, 2000 combines the historical
consolidated balance sheets of the Registrant and Coast, as if the Merger had
been effective on March 31, 2000, after giving effect to certain adjustments.
These adjustments are based on estimates. The Unaudited Pro Forma Condensed
Combined Statements of Operations for the three months ended March 31, 2000 and
1999 and for the year ended December 31, 1999 present the combined results of
operations of the Registrant and Coast as if the Merger had been effective at
the beginning of each period.
The unaudited pro forma condensed combined financial information and
accompanying notes reflect the application of the pooling of interests method of
accounting for the Merger. Under this method of accounting, the recorded
assets, liabilities, shareholders' equity, income and expenses of the Registrant
and Coast are combined and reflected at their historical amounts.
The pro forma combined figures shown in the unaudited pro forma condensed
combined financial information are simply arithmetical combinations of the
Registrant's and Coast's separate financial results; you should not assume that
the Registrant and Coast would have achieved the pro forma combined results if
they had actually been combined during the periods presented.
The combined company expects to achieve merger benefits in the form of
operating cost savings. The pro forma earnings, which do not reflect any direct
costs or potential savings which are expected to result from the consolidation
of the operations of the Registrant and Coast, are not indicative of the results
of future operations. No assurances can be given with respect to the ultimate
level of expense savings.
3
<PAGE>
Pro Forma Earnings with Estimated Operating Efficiencies
The pro forma condensed combined financial information contained in Exhibit
99.1 indicates that, for the three months ended March 31, 2000, the Registrant's
diluted earnings per share (before merger, nonrecurring and extraordinary items)
would have been $0.72, a decline of $0.01 per share from the reported earnings
before the merger with Coast. However, these pro forma earnings per share do
not reflect the operating efficiencies that the Registrant has realized in all
of its previous mergers. On average, the Registrant has realized operating
efficiencies from its prior mergers in excess of 15% of the operating expenses
of the acquired institutions. The following table details the impact of
applying the Registrant's historical percentage of operating efficiencies
attained on a pro forma basis to March 31, 2000 earnings:
<TABLE>
<CAPTION>
Operating Net Diluted
Expenses Income (1) EPS (1)
-------- ---------- -------
<S> <C> <C> <C>
Pro-forma before
operating efficiencies $ 12,878 $0.72
Coast operating expenses: $3,417
Greater Bay Historical Merger & Acquisition
Operating Efficiencies 15.0%
----------
Estimated Operating Efficiencies, Gross 513
Estimated Operating Efficiencies, Net of Tax $ 302 302 $0.02
========== --------
Adjusted Pro-Forma Net Income After
Operating Efficiencies $ 13,180 $0.74
========
(1) Before merger, nonrecurring and extraordinary items.
</TABLE>
No assurance can be given that these operating efficiencies will be
achieved. Information contained under this caption constitutes "forward-
looking statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended, which involve risks and uncertainties. The Registrant's
actual results may differ significantly from the results discussed in these
forward-looking statements. Factors that might cause such a difference
include but are not limited to difficulties in integrating the business of
the newly acquired institution, the timing relating to achieving the
operating efficiencies, economic conditions, competition in the geographic
and business areas in which the Registrant conducts its operations and
government regulation.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Greater Bay Bancorp
(Registrant)
Dated: May 18, 2000 By: /s/ Steven C. Smith
-------------------
Steven C. Smith
Executive Vice President, Chief
Administrative Officer and Chief
Financial Officer
5
<PAGE>
Exhibit Index
-------------
23 Consent of Deloitte & Touche LLP, Independent Auditors of Coast
99.1 Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2000
and unaudited Pro Forma Condensed Combined Statements of Operations for
the three months ended March 31, 2000 and 1999 and for the year ended
December 31, 1999
6
<PAGE>
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration Statements of
Greater Bay Bancorp on Form S-3 (Nos. 333-61679, 333-70025, 333-94343 and
333-35622), Form S-4 (No. 333-35576) and Form S-8 (Nos. 333-30913, 333-67677,
333-30915, 333-16967, 333-47747 and 333-30812) of our report dated January 21,
2000 on the financial statements of Coast Bancorp appearing in the Annual Report
on Form 10-K/A of Coast Bancorp for the year ended December 31, 1999, which
financial statements and report are incorporated by reference in this Current
Report on Form 8-K of Greater Bay Bancorp.
/s/ Deloitte & Touche LLP
San Jose, California
May 18, 2000
<PAGE>
Exhibit 99.1
Unaudited Pro Forma Condensed Combined Balance Sheet
As of March 31, 2000
(Dollars in thousands)
<TABLE>
<CAPTION>
Greater Coast Greater Bay & Co
Bay Bancorp Adjustments (1) Bancorp Combined
--- ------- --------------- ----------------
<S> <C> <C> <C> <C>
Assets
Cash and due from banks $ 138,937 $ 15,364 $ - $ 154,301
Federal funds sold 284,300 24,400 - 308,700
Other short-term securities 805 - - 805
Securities available-for-sale 339,450 140,367 - 479,817
Securities held-to-maturity and other 245,709 - - 245,709
Total loans, net 2,037,828 209,195 - 2,247,023
Property, premises and equipment 21,443 1,842 - 23,285
Interest receivable and other assets 129,170 18,427 400 147,997
----------------- ------------------- --------------- ---------------
Total assets $ 3,197,642 $ 409,595 $ 400 $ 3,607,637
================= =================== =============== ===============
Liabilities
Total Deposits $ 2,845,466 $ 313,634 $ - $ 3,159,100
Other borrowings 41,100 56,024 - 97,124
Other liabilities 53,226 5,472 3,800 62,498
Trust Preferred Securities 59,500 - - 59,500
----------------- ------------------- --------------- ---------------
Total Liabilities 2,999,292 375,130 3,800 3,378,222
----------------- ------------------- --------------- ---------------
Shareholders' EquitY 198,350 34,465 (3,400) 229,415
----------------- ------------------- --------------- ---------------
Total liabilities and shareholders'
equity $ 3,197,642 $ 409,595 $ 400 $ 3,607,637
================= =================== =============== ===============
</TABLE>
(1) The table above reflects all nonrecurring Greater Bay and Coast
Bancorp estimated merger-related costs as of March 31, 2000. The
nonrecurring Greater Bay and Coast Bancorp estimated merger-related
costs are not included on the unaudited pro forma condensed combined
statement of operations but are included on the unaudited pro forma
condensed combined balance sheet as a reduction to shareholders'
equity, net of a $2.0 million tax benefit. These costs will be charged
to expense immediately following the consummation of the merger.
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Quarter Ended March 31, 2000
(Dollars in thousands)
<TABLE>
<CAPTION>
Greater Coast Greater Bay & Co
Bay Bancorp Adjustments (1) Bancorp Combined
--- ------- --------------- ----------------
<S> <C> <C> <C> <C>
Interest on loans $ 47,679 $ 5,701 $ 53,380
Interest on investment securities 9,247 2,305 11,552
Other interest income 4,304 217 4,521
-------------------- ---------------- -------------- -----------------
Total interest income 61,230 8,223 69,453
Interest on deposits 22,820 1,983 24,803
Other interest expense 2,032 702 2,734
-------------------- ---------------- -------------- -----------------
Net interest income 36,378 5,538 41,916
Provision for loans losses 5,227 87 5,314
-------------------- ---------------- -------------- -----------------
Net interest income after provision for loan losses 31,151 5,451 36,602
Other income 14,694 1,317 16,011
Operating expenses 19,335 3,417 22,752
-------------------- ---------------- -------------- -----------------
Income before provision for income taxes and
merger and other related nonrecurring costs and
extraordinary items 26,510 3,351 29,861
Provision for income taxes 10,648 1,316 11,964
-------------------- ---------------- -------------- -----------------
Income before merger and other related nonrecurring
costs, net of tax 15,862 2,035 17,897
Merger and other related nonrecurring costs, net of
tax (2,389) - (2,389)
-------------------- ---------------- -------------- -----------------
Net income $ 13,473 $ 2,035 $ 15,508
==================== ================ ============== =================
Net income per share - basic (1) $ 0.77 $ 0.42 $ 0.75
==================== ================ ============== =================
Average common shares outstanding 14,031,000 4,823,000 (1,766,000) 17,088,000
==================== ================ ============== =================
Net income per share - diluted (1) $ 0.73 $ 0.41 $ 0.71
==================== ================ ============== =================
Average common and common equivalent shares
outstanding 14,763,000 4,964,000 (1,818,000) 17,909,000
==================== ================ ============== =================
</TABLE>
(1) Before merger, nonrecurring and extraordinary items.
(2) Calculated as the historical Greater Bay weighted average shares plus
the historical Coast Bancorp weighted average shares adjusted for the
conversion ratio of 0.6338.
<PAGE>
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Quarter Ended March 31, 1999
(Dollars in Thousands)
<TABLE>
<CAPTION>
Greater Coast Greater Bay & Coast
Bay Bancorp Adjustments (2) Bancorp Combined
--- ------- --------------- -------------------
<S> <C> <C> <C> <C>
Interest on loans $ 32,237 $ 4,133 $ 36,370
Interest on investment securities 5,936 1,530 7,466
Other interest income 1,976 374 2,350
------------ ------------- ----------- -----------
Total interest income 40,149 6,037 46,186
Interest on deposits 13,787 1,512 15,299
Other interest expense 2,142 139 2,281
------------ ------------- ----------- -----------
Net interest income 24,220 4,386 28,606
Provision for loans losses 1,163 - 1,163
------------ ------------- ----------- -----------
Net interest income after provision for loan losses 23,057 4,386 27,443
Other income 3,122 1,472 4,594
Operating expenses 15,434 3,203 18,637
------------ ------------- ----------- -----------
Income before provision for income taxes and
merger and other related nonrecurring costs and
extraordinary items 10,745 2,655 13,400
Provision for income taxes 4,181 1,099 5,280
------------ ------------- ----------- -----------
Income before merger and other related nonrecurring
costs, net of tax 6,564 1,556 8,120
Merger and other related nonrecurring costs, net of tax - - -
------------ ------------- ----------- -----------
Income before extraordinary items 6,564 1,556 8,120
Extraordinary item (88) - (88)
------------ ------------- ----------- -----------
Net income $ 6,476 $ 1,556 $ 8,032
============ ============= =========== ===========
Net income per share - basic (1) $ 0.50 $ 0.33 $ 0.50
============ ============= =========== ===========
Average common shares outstanding 13,053,000 4,773,000 (1,738,000) 16,088,000
============ ============= =========== ===========
Net income per share - diluted (1) $ 0.46 $ 0.32 $ 0.48
============ ============= =========== ===========
Average common and common
equivalent shares outstanding 13,973,000 4,876,000 (1,785,000) 17,064,000
============ ============= =========== ===========
</TABLE>
(1) Before merger, nonrecurring and extraordinary items.
(2) Calculated as the historical Greater Bay weighted average shares plus the
historical Coast Bancorp weighted average shares adjusted for the
conversion ratio of 0.6338.
Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended December 31, 1999
(Dollars in Thousands)
<TABLE>
<CAPTION>
Greater Coast Greater Bay & Coast
Bay Bancorp Adjustments (2) Bancorp Combined
--- ------- --------------- ----------------
<S> <C> <C> <C> <C>
Interest on loans $ 149,883 $ 19,403 $ 169,286
Interest on investment securities 27,675 7,013 34,688
Other interest income 12,740 885 13,625
------------ ------------ -------------- ------------
Total interest income 190,298 27,301 217,599
Interest on deposits 68,049 6,179 74,228
Other interest expense 8,508 1,094 9,602
------------ ------------ -------------- ------------
Net interest income 113,741 20,028 133,769
Provision for loans losses 13,064 - 13,064
------------ ------------ -------------- ------------
Net interest income after provision for loan losses 100,677 20,028 120,705
Other income 33,306 4,670 37,976
Operating expenses 79,212 13,372 92,584
------------ ------------ -------------- ------------
Income before provision for income taxes and
merger and other related nonrecurring costs and
extraordinary items 54,771 11,326 66,097
Provision for income taxes 17,659 4,387 22,046
------------ ------------ -------------- ------------
Income before merger and other related nonrecurring
costs, net of tax 37,112 6,939 44,051
Merger and other related nonrecurring costs, net of tax (6,486) - (6,486)
------------ ------------ -------------- ------------
Income before extraordinary items 30,626 6,939 37,565
Extraordinary item (88) - (88)
------------ ------------ -------------- ------------
Net income $ 30,538 $ 6,939 $ 37,477
============ ============ ============== ============
Net income per share - basic (1) $ 2.45 $ 1.45 $ 2.42
============ ============ ============== ============
Average common shares outstanding 13,310,000 4,792,000 (1,761,000) 16,341,000
============ ============ ============== ============
Net income per share - diluted (1) $ 2.30 $ 1.41 $ 2.28
============ ============ ============== ============
Average common and common
equivalent shares outstanding 14,189,000 4,910,000 (1,815,000) 17,284,000
============ ============ ============== ============
</TABLE>
(1) Before merger, nonrecurring and extraordinary items.
(2) Calculated as the historical Greater Bay weighted average shares plus the
historical Coast Bancorp weighted average shares adjusted for the conversion
ratio of 0.6338.
