As filed with the Securities and Exchange Commission on May 10, 2000
Registration Statement No. 333-30988
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
---------------
NBT BANCORP INC.
(Exact Name of Registrant as specified in its Charter)
---------------
DELAWARE 6712 16-1268674
(State or Other (Primary Standard Industrial (I.R.S. Employer
Jurisdiction of Classification Code Number) Identification No.)
Incorporation or
Organization)
52 South Broad Street
Norwich, New York 13815
(607) 337-2265
(Address, Including Zip Code, and Telephone Number, Including
Area Code of Registrant's Principal Executive Offices)
DARYL R. FORSYTHE
President and Chief Executive Officer
NBT Bancorp Inc.
52 South Broad Street
Norwich, New York 13815
(607) 337-2265
(Name, Address, Including Zip Code, and Telephone
Number, Including Area Code, of Agent for Service)
<PAGE>
---------------
Copies to:
Brian D. Alprin, Esq. Lawrence R. Wiseman, Esq.
Laurence S. Lese, Esq. Blank Rome Comisky & McCauley LLP
Duane, Morris & Heckscher LLP One Logan Square
1667 K Street, NW, Suite 700 Philadelphia, PA 19103-6998
Washington, DC 20006 (215) 569-5500
(202) 776-7800
================================================================================
<PAGE>
[NBT [PIONEER AMERICAN
LOGO APPEARS HERE] LOGO APPEARS HERE]
SUPPLEMENTAL JOINT PROXY STATEMENT/PROSPECTUS
On April 5, 2000, we sent to our stockholders a joint proxy
statement/prospectus describing, among other things, the proposed merger of our
two companies. We indicated that the boards of directors of both of our
companies had unanimously agreed on the merger and that the board of directors
of each company believed the merger to be in the best interests of its
stockholders and unanimously recommended that its stockholders vote to approve
the merger agreement. The boards of directors of each company as of the date of
this letter and the enclosed supplemental proxy statement/prospectus continue to
be of the same view and unanimously support the merger. THIS SUPPLEMENTAL JOINT
PROXY STATEMENT/PROSPECTUS SUPPLEMENTS OUR APRIL 5, 2000 DOCUMENT.
Since our April 5, 2000 letter and joint proxy statement/prospectus, NBT
Bancorp has entered into a merger agreement with BSB Bancorp, Inc., a Delaware
corporation based in Binghamton, New York. If NBT Bancorp completes its merger
with BSB Bancorp, the combined company would have assets of approximately $4.7
billion; the combined company would be about twice the size of NBT Bancorp, even
after its merger with Pioneer American. Because of the importance and
significance of this announcement, we will not be able to vote on our merger at
our May 16, 2000 meetings. This supplement will discuss the proposed NBT
Bancorp-BSB Bancorp merger and how it will impact the current decision before
NBT Bancorp and Pioneer American stockholders relating to the merger of NBT
Bancorp and Pioneer American. Please read this supplement carefully. It contains
important information that you should know before you decide to vote with
respect to the NBT Bancorp/Pioneer American merger. We are not asking you at
this time to vote on the NBT Bancorp-BSB Bancorp merger. IN THE FUTURE NBT
BANCORP AND BSB BANCORP WILL PREPARE AND SEND A PROXY STATEMENT/PROSPECTUS TO
EACH OF THEIR RESPECTIVE STOCKHOLDERS TO EXPLAIN THAT MERGER AND TO REQUEST
THEIR CONSIDERATION OF AND VOTE WITH RESPECT TO THAT MERGER.
Each of us has already notified our stockholders of our intention to
adjourn our respective stockholders' meetings from May 16, 2000 to a future
date, which we said was tentatively June 20, 2000. We advise you that both the
NBT Bancorp stockholders' meeting and the Pioneer American stockholders' meeting
were adjourned to June 20, 2000. At its reconvened special meeting, the Pioneer
American stockholders will consider and vote upon the merger agreement between
NBT Bancorp and Pioneer American and the merger of these companies. NBT Bancorp
convened its annual meeting as scheduled on May 16, 2000, and voted upon the
election of directors, ratification of the NBT Bancorp Board's selection of
auditors and the NBT Bancorp Employee Stock Purchase Plan, but not upon the
issuance of NBT Bancorp stock in the merger and ratification of the merger
agreement. Instead, NBT Bancorp adjourned its stockholders' meeting with respect
to their consideration of the stock issuance and ratification of the merger
agreement to June 20, 2000 at which time the NBT Bancorp stockholders will
consider and vote upon the stock issuance and merger agreement with Pioneer
American.
WE ENCLOSE A NEW PROXY CARD RESPECTING THE MERGER BETWEEN NBT BANCORP AND
PIONEER AMERICAN. IF YOU HAVE ALREADY COMPLETED AND RETURNED THE PROXY CARD WE
SENT TO YOU WITH THE APRIL 3, 2000 MATERIALS AND YOU DO NOT WISH TO CHANGE YOUR
VOTE ON THE MERGER BETWEEN NBT BANCORP AND PIONEER AMERICAN, YOU NEED DO
NOTHING. YOUR PREVIOUSLY SUBMITTED PROXY CARD WILL BE VOTED AS YOU HAVE
DIRECTED. IF, HOWEVER, YOU WISH TO CHANGE YOUR VOTE ON THE MERGER BETWEEN NBT
BANCORP AND PIONEER AMERICAN, PLEASE COMPLETE THE ENCLOSED PROXY CARD AND RETURN
IT TO US PROMPTLY. IF YOU HAVE NOT YET VOTED ON THE MERGER BETWEEN NBT BANCORP
AND PIONEER AMERICAN AND WISH TO DO SO AT THE PRESENT TIME, YOU MAY COMPLETE
EITHER THE EARLIER PROXY CARD OR THE ENCLOSED PROXY CARD AND RETURN IT IN THE
ACCOMPANYING POSTAGE-PAID ENVELOPE.
We encourage you to read this entire document carefully. This supplement
incorporates important business and financial information about NBT Bancorp and
Pioneer American that is not included in or delivered with this document. See
"Where You Can Find More Information" on page .
/s/ Daryl R. Forsythe /s/ John W. Reuther
- --------------------- -------------------
Daryl R. Forsythe John W. Reuther
President and Chief Executive Officer President and Chief Executive Officer
NBT Bancorp Inc. Pioneer American Holding Company Corp.
<PAGE>
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR
DISAPPROVED OF THE NBT BANCORP SHARES TO BE ISSUED UNDER THIS SUPPLEMENT OR
PASSED UPON THE ADEQUACY OR ACCURACY OF THIS SUPPLEMENT. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
THE SHARES OF NBT BANCORP COMMON STOCK OFFERED BY THIS SUPPLEMENT ARE NOT
SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK OR NON-BANK
SUBSIDIARY OF ANY OF THE PARTIES. THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY DOES
NOT INSURE OR GUARANTEE ANY LOSS TO YOU OF YOUR INVESTMENT VALUE IN THE NBT
BANCORP COMMON STOCK.
Joint proxy statement/prospectus supplement dated May , 2000, and first mailed
to stockholders on or about May , 2000.
<PAGE>
NBT Bancorp Inc.
52 South Broad Street
Norwich, New York 13815
NOTICE OF ADJOURNED ANNUAL MEETING OF STOCKHOLDERS
NBT Bancorp Inc., a Delaware corporation, will reconvene its adjourned
annual meeting of stockholders at the Holiday Inn Arena, 2-8 Hawley Street,
Binghamton, New York on June 20, 2000 at 2:00 p.m. local time for the following
purposes:
1. To consider and vote upon a proposal to issue approximately 5.2 million
shares of NBT common stock in the merger and to ratify the Agreement and Plan of
Merger, dated as of December 7, 1999, and amended as of March 7, 2000, between
NBT and Pioneer American Holding Company Corp., a Pennsylvania corporation,
which will approve the merger and the following actions described in the merger
agreement:
Pioneer American will merge with a subsidiary of NBT, with Pioneer
American being the surviving corporation,
Following the first merger, Pioneer American will merge with and into
NBT, with NBT being the surviving corporation, and
NBT will issue approximately 5.2 million shares of common stock to the
former Pioneer American stockholders upon completion of the merger.
2. To transact such other business as may properly come before the NBT
reconvened annual meeting.
FOR MORE INFORMATION ABOUT THE MERGER, PLEASE REVIEW THE JOINT PROXY
STATEMENT/PROSPECTUS THAT WE PREVIOUSLY SENT TO YOU AND THE MERGER AGREEMENT
ATTACHED AS APPENDIX A TO THAT DOCUMENT.
Whether or not you plan on attending the reconvened annual meeting, if you
have not already voted on the merger between NBT and Pioneer American or if,
after reviewing the accompanying supplement to the joint proxy
statement/prospectus you wish to change your vote on the merger between NBT and
Pioneer American, please complete, sign and date the enclosed proxy and return
it promptly in the accompanying postage-paid envelope. If you have already voted
on the merger between NBT and Pioneer American and do not wish to change your
vote, you need not return another proxy. Your previously returned proxy will be
voted in the manner you have specified.
The board of directors of NBT unanimously recommends that you vote "FOR"
approval of the issuance of NBT common stock in the merger with Pioneer American
and ratification of the merger agreement, the merger and the other matters
contemplated by the merger agreement. The affirmative vote of a majority of the
shares of NBT common stock present and voting and entitled to vote at the
meeting is required to approve the issuance of NBT common stock in the merger
with Pioneer American and the merger agreement and related matters.
By Order of the Board of Directors of
NBT Bancorp Inc.
/s/ Daryl R. Forsythe
-----------------
Daryl R. Forsythe
President and Chief Executive Officer
Norwich, New York
May , 2000
PIONEER AMERICAN HOLDING COMPANY CORP.
41 NORTH MAIN STREET
<PAGE>
CARBONDALE, PENNSYLVANIA 18407
NOTICE OF ADJOURNED SPECIAL MEETING OF STOCKHOLDERS
Pioneer American Holding Company Corp., a Pennsylvania corporation, will
reconvene its adjourned special meeting of stockholders at Heart Lake Lodge,
1299 Heart Lake Road, Jermyn, Pennsylvania on June 20, 2000 at 10:00 a.m. local
time for the following purposes:
1. To consider and vote upon a proposal to adopt the Agreement and Plan of
Merger, dated as of December 7, 1999, and amended as of March 7, 2000, by and
between Pioneer American and NBT Bancorp Inc., a Delaware corporation, and to
approve the merger and other transactions described in the merger agreement; and
2. To transact such other business as may properly come before the Pioneer
American reconvened special meeting.
FOR MORE INFORMATION ABOUT THE MERGER, PLEASE REVIEW THE JOINT PROXY
STATEMENT/PROSPECTUS THAT WE PREVIOUSLY SENT TO YOU AND THE MERGER AGREEMENT
ATTACHED AS APPENDIX A.
The board of directors of Pioneer American recommends that you vote "FOR"
approval of the merger agreement, the merger and the other matters contemplated
by the merger agreement. The affirmative vote of seventy percent of the
outstanding shares of Pioneer American common stock entitled to vote at the
meeting is required to approve the merger agreement and related matters. Pioneer
American stockholders have a right to dissent to the merger agreement and to
obtain payment in cash of the fair value of their Pioneer American shares by
complying with the procedures described in the April 3, 2000, joint proxy
statement/prospectus we previously sent to you.
Whether or not you plan on attending the reconvened special meeting, if you
have not already voted on the merger between NBT and Pioneer American or if,
after reviewing the accompanying supplement to the joint proxy
statement/prospectus you wish to change your vote on the merger between NBT and
Pioneer American, please complete, sign and date the enclosed proxy and return
it promptly in the enclosed postage-paid envelope. If you have already voted on
the merger between NBT and Pioneer American and do not wish to change your vote,
you need not return another proxy. Your previously returned proxy will be voted
in the manner you have specified.
By Order of the Board of Directors of
Pioneer American Holding Company Corp.
/s/ John W. Reuther
-------------------
John W. Reuther
President and Chief Executive Officer
Carbondale, Pennsylvania
May , 2000
<PAGE>
QUESTIONS AND ANSWERS ABOUT THE ADJOURNED STOCKHOLDERS' MEETINGS
Q: WHAT IS THE PURPOSE OF THIS SUPPLEMENT?
A: Since our mailing of the joint proxy statement/prospectus on April 5, 2000,
NBT has signed an agreement to merge with BSB. Because that merger, if
completed, would significantly alter the size and scope of NBT and its business
operations, we have determined to delay the consideration of and vote by our
stockholders on the merger between NBT and Pioneer American and to furnish our
respective stockholders with information regarding the proposed merger between
NBT and BSB in order that our stockholders might be better able to make an
informed judgment regarding the merger between NBT and Pioneer American.
Q: HAVE THE TERMS OF THE MERGER BETWEEN NBT AND PIONEER AMERICAN CHANGED?
A: No. The terms of the merger agreement between NBT and Pioneer American remain
the same. See "What Pioneer American Stockholders Will Receive as a Result of
the Merger," below.
Q: AT OUR RESPECTIVE MEETINGS, ARE WE TO VOTE ON THE PROPOSED NBT-BSB MERGER?
A: No. We are holding our respective stockholders' meetings only so you can
consider and vote upon the merger between NBT and Pioneer American. You will not
vote on the merger between NBT and BSB at our respective June 20, 2000 meetings.
Only at some time in the future will NBT stockholders be requested to consider
and vote upon the proposed merger between NBT and BSB. Separately from the
consideration of our merger, NBT and BSB will prepare disclosure material for
the stockholders of NBT and BSB regarding that proposed merger.
Q: MUST I RETURN ANOTHER PROXY CARD?
A: No. After you have carefully read this supplement, you need do nothing if you
have already returned your proxy card and do not wish to change your vote on the
merger between NBT and Pioneer American. If, however, you have not yet voted on
the merger between NBT and Pioneer American and you wish to vote now, or if you
wish to change your vote on the merger between NBT and Pioneer American, please
indicate on the enclosed proxy card how you want your shares to be voted, then
sign, date and mail it in the accompanying postage-paid envelope as soon as
possible so that your shares may be represented and voted at the NBT reconvened
annual meeting or the Pioneer American reconvened special meeting. If you sign
and send in your proxy and do not indicate how you want to vote, your proxy will
be counted as a vote in favor of the proposal.
Q: CAN I CHANGE MY VOTE AFTER I HAVE MAILED MY SIGNED PROXY CARD?
A: Yes. There are three ways for you to revoke your proxy and change your vote.
First, you may send a later-dated, signed proxy card before the meeting of your
company. Second, you may attend your company's meeting in person and vote.
Third, you may revoke any proxy by written notice to the Chief Executive Officer
of NBT or Pioneer American, as appropriate, prior to your company's meeting. If
you have instructed a broker to vote your shares, you must follow directions
received from your broker to change your vote.
Q: WHOM SHOULD I CALL WITH QUESTIONS OR TO OBTAIN ADDITIONAL COPIES OF THIS
SUPPLEMENT OR COPIES OF THE JOINT PROXY STATEMENT/PROSPECTUS?
NBT Bancorp Inc. Pioneer American Holding Company Corp.
52 South Broad Street 41 North Main Street
Norwich, New York 13815 Carbondale, Pennsylvania 18407
Attention: Michael J. Chewens, CPA Attention: Patricia A. Cobb, Esq.
Phone Number: (607) 337-6520 Phone Number: (570) 282-8045
i
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
QUESTIONS AND ANSWERS ABOUT THE ADJOURNED STOCKHOLDERS' MEETINGS i
The Adjourned Stockholders' Meetings 2
What Pioneer American Stockholders Will Receive as a Result of the Merger 3
Proposed Merger Between NBT and BSB 4
Revised Fairness Opinions by Financial Advisors 6
Opinion of NBT's Financial Advisor 6
Opinion of Pioneer American's Financial Advisor 11
Price Range of Common Stock and Dividends 15
Experts 16
Where You Can Find More Information 16
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS 17
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS 23
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 26
APPENDIX A
Fairness Opinion of McConnell, Budd & Downes, Inc.
APPENDIX B
Fairness Opinion of Danielson Associates Inc.
</TABLE>
<PAGE>
THE ADJOURNED STOCKHOLDERS' MEETINGS
NBT. The adjourned annual meeting of NBT stockholders will be reconvened at the
Holiday Inn Arena, 2-8 Hawley Street, Binghamton, New York at 2:00 p.m., local
time, on Tuesday, June 20, 2000. At our reconvened annual meeting, we will ask
that you consider and vote upon
the issuance of approximately 5.2 million shares of NBT common stock in the
merger between NBT and Pioneer American and the ratification of the
Agreement and Plan of Merger, dated as of December 7, 1999, and amended as
of March 7, 2000, between NBT and Pioneer American, which will approve the
merger and the following actions described in the merger agreement:
Pioneer American will merge with a subsidiary of NBT, with Pioneer
American being the surviving corporation,
Following the first merger, Pioneer American will merge with and into
NBT, with NBT being the surviving corporation, and
NBT will issue approximately 5.2 million shares of common stock to the
former Pioneer American stockholders upon completion of the merger.
Additionally, we will transact such other business as may properly come before
the NBT reconvened annual meeting. For a more comprehensive description of the
merger agreement, the merger and related transactions, we refer you to our
discussion of these matters which appeared in our joint proxy
statement/prospectus, dated April 3, 2000.
Only holders of record of NBT common stock at the close of business on
April 3, 2000, which is the record date for the NBT annual meeting, will be
entitled to vote at the NBT reconvened annual meeting and any further
adjournments of the meeting. You can cast one vote for each share of NBT common
stock that you owned on the record date for each matter proposed at the NBT
reconvened annual meeting.
Approval of NBT's issuance of its common stock to the Pioneer American
stockholders in the merger and ratification of the merger agreement and
completion of the merger require, among other things, approval by the holders of
a majority of the shares of NBT common stock present and voting and entitled to
vote at the NBT adjourned annual meeting. We will count the vote of all proxies
received by us since we mailed our proxy materials, if those proxies have not
since been revoked. In order to have a quorum, a majority of the total voting
power of the outstanding shares of NBT's common stock entitled to vote at the
NBT annual meeting must be represented in person or by proxy.
The NBT Board believes that the merger is fair to you and is in your best
interests, and unanimously recommends that you vote FOR the proposal to approve
the issuance of NBT common stock in the merger and to ratify the merger
agreement, the merger and the related matters.
Pioneer American. The adjourned special meeting of Pioneer American stockholders
will be reconvened at Heart Lake Lodge, 1299 Heart Lake Road, Jermyn,
Pennsylvania at 10:00 a.m., local time, on Tuesday, June 20, 2000. At our
reconvened special meeting, we will ask that you consider and vote upon
a proposal to adopt the Agreement and Plan of Merger, dated as of December
7, 1999, and amended as of March 7, 2000, by and between Pioneer American
and NBT Bancorp Inc., a Delaware corporation, and to approve the merger and
other transactions described in the merger agreement.
Additionally, we will transact such other business as may properly come before
the Pioneer American reconvened special meeting. For a more comprehensive
description of the merger agreement, the merger and related transactions, we
refer you to our discussion of these matters which appeared in our joint proxy
statement/prospectus, dated April 3, 2000.
2
<PAGE>
Only holders of record of Pioneer American common stock at the close of
business on March 24, 2000, which is the record date for the Pioneer American
special meeting, will be entitled to vote at the Pioneer American reconvened
special meeting and any further adjournments of the meeting. You can cast one
vote for each share of Pioneer American common stock that you owned on the
record date for each matter proposed at the Pioneer American reconvened special
meeting.
Approval of the merger agreement and completion of the merger require,
among other things, approval by the holders of seventy percent of the
outstanding shares of Pioneer American common stock entitled to vote. We will
count the vote of all proxies received by us since we mailed our proxy
materials, if those proxies have not since been revoked. In order to have a
quorum, a majority of the total voting power of the outstanding shares of
Pioneer American's common stock entitled to vote at the Pioneer American annual
meeting must be represented in person or by proxy.
The Pioneer American Board believes that the merger is fair to you and is
in your best interests, and unanimously recommends that you vote FOR the
proposal to approve the merger agreement, the merger and the related matters.
WHAT PIONEER AMERICAN STOCKHOLDERS WILL RECEIVE AS A RESULT OF THE MERGER
THE EXCHANGE RATIO. Pioneer American stockholders will receive 1.805 shares of
NBT common stock for each share of Pioneer American common stock that they own.
TERMINATION UPON A DECLINE IN THE VALUE OF NBT COMMON STOCK. Pioneer American
has the right to cancel the merger if:
the price of a share of NBT common stock declines below $15.00 and
the NBT stock price decline, expressed as a percentage, is more than 15
percentage points greater than the weighted average stock price decline of
the index group.
The price per NBT share of $15.00 represents a 10.45% decline in the price
per NBT share of $16.75 which is the share price used by NBT and Pioneer
American in their negotiation of the merger agreement. Even if both of these two
conditions were present and Pioneer American were to decide to cancel the
merger, NBT could require Pioneer American to complete the merger by increasing
the number of shares of NBT common stock to be issued to Pioneer American's
stockholders, so that a Pioneer American stockholder would receive at least
$27.08 worth of NBT stock for each share of Pioneer American common stock.
In order to determine the price and percentage decline in the value of the
NBT common stock and of the weighted average stock price of the index group, we
will take the average of the closing bid and asked prices per share for NBT
common stock and for the companies in the index group for each of the 20
consecutive trading days ending on the eighth trading day before the day chosen
to be the effective date of the merger.
As of the date of this supplement, [EACH CONDITION/ONLY ONE CONDITION] is
present to the right of Pioneer American to cancel the merger (assuming for the
sake of illustration that the effective date of the merger were seven trading
days after the date of this supplement). Consequently, under current conditions
and assumptions, the Pioneer American Board would [not] have the right to cancel
the merger agreement. In the event Pioneer American were to terminate the merger
agreement under the provisions referenced in this section, action by the
stockholders of Pioneer American would not be required. Neither the NBT Board
nor the Pioneer American Board has made a decision as to whether it would
exercise its rights under the merger agreement under such circumstances. The
respective boards of NBT and Pioneer American would make such a decision in
light of the circumstances existing at the time that the respective board has
the opportunity to make such an election, if any. Prior to making any
determination to exercise their respective rights under the merger agreement,
the Boards would consult their respective financial and other advisors and would
consider all financial and other information deemed relevant to their respective
decisions. There can be no assurance that the Boards would exercise their
respective rights under the merger agreement if the conditions set forth above
were applicable. If the Pioneer American Board were not to elect to exercise its
right to
3
<PAGE>
terminate the merger agreement under the circumstances discussed in this
section, the exchange ratio would be 1.805 and the dollar value of the
consideration which the stockholders of Pioneer American would receive for each
share of Pioneer American common stock would be the value of 1.805 shares of NBT
common stock at the effective time of the merger.
PROPOSED MERGER BETWEEN NBT AND BSB
ANNOUNCEMENT OF MERGER WITH BSB. On April 20, 2000, NBT and BSB Bancorp, Inc., a
Delaware corporation, announced that they had entered into an Agreement and Plan
of Merger, dated as of April 19, 2000. In this section and elsewhere in this
supplement, we refer to the merger agreement between NBT and BSB as the "merger
agreement with BSB" and the resulting merger as the "merger with BSB."
Under the merger agreement with BSB, BSB and NBT will merge, with NBT being
the surviving corporation. The surviving corporation will have assets of
approximately $4.7 billion. NBT and BSB will choose a new name for the surviving
corporation before the merger with BSB occurs. The surviving corporation will
have three direct operating subsidiaries including two community banks (the
combined NBT and BSB banks and the combined Lake Ariel and Pioneer American
banks) and a financial services company. Stockholders of BSB will receive two
shares of NBT common stock for each share exchanged. Based on the April 19,
2000, closing price of NBT common stock on the Nasdaq National Market, the
transaction is valued at $251 million or $24.00 per share for the outstanding
common stock of BSB. Based on the closing price of NBT common stock on the
Nasdaq National Market of $ per share on May , 2000, the most recent practicable
date prior to the mailing of this supplement, the transaction is valued at $ or
$ per share for the outstanding common stock of BSB. The merger with BSB, which
has been unanimously approved by the boards of directors of NBT and BSB, is
subject to the approval by each company's stockholders and by banking
regulators. NBT anticipates the merger will close in the fourth quarter of 2000.
NBT intends the merger with BSB to be accounted for as a pooling-of-interests
and to qualify as a tax-free exchange for BSB stockholders.
BSB has provided NBT an option to acquire a number of shares of BSB's
common stock equal to 19.9% of BSB's common stock outstanding as of the first
date the option becomes exercisable; the option is exercisable in the event of
certain circumstances involving transactions with third parties, acts of third
parties, or break-up of the merger agreement with BSB. NBT has provided BSB an
option to acquire a number of shares of NBT's common stock equal to 19.9% of
NBT's common stock outstanding as of the first date the option becomes
exercisable; the option is exercisable in the event of certain circumstances
involving transactions with third parties, acts of third parties, or break-up of
the merger agreement with BSB.
MERGER OF BANKING SUBSIDIARIES. Immediately following the merger with BSB, NBT's
and BSB's principal banking subsidiaries, NBT Bank, N.A. and BSB Bank & Trust
Company, will merge, with NBT Bank being the surviving bank in the bank merger.
The surviving bank will be one of the largest independent community banks in
upstate New York. The surviving bank will serve 12 counties from more than 55
offices and over 100 ATMs. A new name will be chosen for the surviving bank
prior to the merger with BSB.
MANAGEMENT OF THE SURVIVING CORPORATION FOLLOWING THE MERGER OF NBT WITH BSB.
The surviving corporation will have a 15-seat board of directors which will be
made up of seven directors designated by BSB from the members of its board of
directors and six directors designated by NBT from the members of its board,
plus one designated by NBT from NBT's newly acquired Lake Ariel Bancorp, Inc.
Pennsylvania subsidiary who is serving on the NBT Board and one designated by
NBT from Pioneer American who is serving on the NBT Board, subject to the
closing of the merger of NBT and Pioneer American. If we do not consummate the
merger between NBT and Pioneer American before the effective time of the merger
with BSB, the board of directors of the surviving corporation will consist of 13
directors, six of whom will be designated by BSB, six by NBT, and one former
Lake Ariel board member who is serving on the NBT Board. This former Lake Ariel
board member will be designated by NBT. Upon completion of the merger with BSB,
common stockholders of NBT will have ownership of approximately 53 percent of
the surviving corporation while BSB's common stockholders will own approximately
47 percent, assuming consummation of the merger between NBT and Pioneer
American.
4
<PAGE>
Daryl R. Forsythe, president and chief executive officer of NBT, will
become the chairman, president and chief executive officer of the surviving
corporation and William C. Craine, chairman of BSB, will become the vice
chairman of the surviving corporation and chairman of its executive committee.
NBT Bank's president and chief operating officer, Martin A. Dietrich, will
become the president and chief operating officer of the surviving bank. Michael
J. Chewens, executive vice president and chief financial officer of NBT, will
serve as chief financial officer for the surviving corporation. Other members of
the executive management teams at NBT and BSB will retain key roles including:
Glenn R. Small and John R. Bradley, executive vice presidents of lending and
Larry Denniston, senior vice president and corporate secretary.
The corporate offices of the surviving corporation will be located in
Binghamton. Other major bank functions will be conducted from the surviving
corporation's Norwich, Binghamton and Scranton locations following the merger
with BSB.
IMPACT OF MERGER WITH BSB UPON PIONEER AMERICAN STOCKHOLDERS. The completion of
the proposed merger with BSB will change the results of the merger between NBT
and Pioneer American in a number of ways. For ease of reference, we will refer
in this heading to the merger agreement between NBT and Pioneer American as the
"NBT/PA Agreement."
The NBT/PA Agreement provides that, following the merger between NBT
and Pioneer American, the NBT Board will consist of the directors of
NBT immediately prior to the merger between NBT and Pioneer American
(of whom there are currently twelve) and three other individuals who
are currently members of the Pioneer American Board, Messrs. Joseph G.
Nasser, Gene E. Goldenziel and Richard Chojnowski. The merger
agreement with BSB provides that following the merger with BSB (and
assuming completion of the NBT and Pioneer American merger), the NBT
Board will consist of 15 directors, seven of whom will be designees of
BSB, six will be designees of NBT, one will be a former Lake Ariel
director who at the time of the merger with BSB will be an NBT
director, and one will be a former Pioneer American director who at
the time of the merger with BSB will be an NBT director. Accordingly,
following the merger between NBT and Pioneer American and until
completion of the merger with BSB, the NBT Board will consist of a
number of directors currently contemplated as being 15 and three of
those directors will be Messrs. Nasser, Goldenziel and Chojnowski.
Upon completion of the merger with BSB, the board of directors of the
surviving corporation will be reconstituted and only one former
Pioneer American director will at that time be a director of the
surviving corporation.
In our joint proxy statement/prospectus, dated April 3, 2000, we
stated that following the merger between NBT and Pioneer American the
former stockholders of Pioneer American would own approximately 5.2
million shares of NBT common stock, or approximately 22% of the
outstanding stock of the combined company. Following the merger
between NBT and Pioneer American, the surviving corporation will have
consolidated assets of approximately $2.4 billion and stockholders'
equity of approximately $182 million (as of December 31, 1999, on a
pro forma combined basis). Upon completion of the merger with BSB, the
former Pioneer American stockholders would continue to own
approximately 5.2 million shares of common stock of the surviving
corporation (assuming for the sake of argument that no former Pioneer
American stockholder will have sold any of his or her NBT shares
following completion of the merger between NBT and Pioneer American).
This number of shares of common stock of the surviving corporation in
the hands of former Pioneer American stockholders would represent
approximately 12% of the outstanding shares of the surviving
corporation following the merger with BSB. Upon completion of the
merger with BSB, the surviving corporation will have consolidated
assets of approximately $4.7 billion and stockholders' equity of
approximately $325.0 million.
NBT, as the surviving corporation in the merger with BSB, expects that,
after completion of that merger and subject to approval and declaration by its
Board, it will continue its current dividend policy and declare regularly
scheduled quarterly cash dividends on the shares of its common stock consistent
with past practices. The current annualized rate of cash dividends on the shares
of NBT common stock is $0.68 per share.
5
<PAGE>
REVISED FAIRNESS OPINIONS BY FINANCIAL ADVISORS
OPINION OF NBT'S FINANCIAL ADVISOR
On December 7, 1999, McConnell, Budd & Downes, Inc. ("MB&D") delivered its
opinion to the NBT Board, that as of that date, the exchange ratio was fair,
from a financial point of view to NBT stockholders. The basis for MB&D's
opinion, which is unchanged, has been updated for the purposes of this joint
proxy statement/prospectus and appears in Appendix A. The exchange ratio was
negotiated based on consideration of numerous factors including the following:
An analysis of the possible future earnings per share results for the
parties on both a combined and a stand-alone basis.
Anticipated dilutive or accretive effects of the prospective
transaction to the earnings per share of NBT.
Probable impact on dividends payout ratio as a result of the
contemplated transaction.
Loan portfolios and relative asset quality as disclosed by the
parties.
Adequacy of reserves for loan and lease losses of the parties.
Composition of the deposit bases of each of the parties.
Analysis of the historical trading range, trading pattern and relative
liquidity of the common shares of each of the parties.
Accounting equity capitalization, the tangible equity capitalization
and the market capitalization of each of the parties.
Contemplation of other factors, including certain intangible factors.
MB&D has acted as financial advisor to NBT on a contractual basis since
October 20, 1994 in connection with NBT's development and implementation of its
strategic plan and has assisted NBT in the evaluation of numerous hypothetical
affiliation opportunities with banks, thrifts and other financial institutions
since that date. With respect to the pending transaction involving Pioneer
American, MB&D advised NBT during the evaluation and negotiation process leading
up to the execution of the merger agreement and provided NBT with a number of
analyses as to a range of financially feasible exchange ratios. The
determination of the applicable exchange ratio was arrived at in an arms-length
negotiation between NBT and Pioneer American in a process in which MB&D advised
NBT and participated directly in the negotiations.
MB&D was retained based on its qualifications and experience in the
financial analysis of banking and thrift institutions generally, its knowledge
of the New York and Pennsylvania banking markets in particular, as well as its
experience with merger and acquisition transactions involving banking
institutions. As a part of its investment banking business, which is focused
exclusively on financial services industry participants, MB&D is continually
engaged in the valuation of financial institutions and their securities in
connection with its equity brokerage business generally and mergers and
acquisitions in particular. Members of the Corporate Finance Advisory Group of
MB&D have extensive experience in advising financial institution clients on
mergers and acquisitions. In the ordinary course of its business as an NASD
broker-dealer, MB&D may, from time to time, purchase securities from or sell
securities to NBT or Pioneer American and as a market maker in securities. MB&D
may from time to time have a long or short position in, and buy or sell debt or
equity securities of NBT or Pioneer American for its own account or for the
accounts of its customers. In addition, in the ordinary course of business, the
employees of MB&D may have direct or indirect investments in the debt or equity
securities of either or both NBT or Pioneer American.
The full text of the opinion, which sets forth assumptions made, matters
considered and limits on the review undertaken, is attached hereto as Appendix
A. MB&D urges that all NBT shareholders read the opinion in its entirety and the
joint proxy statement/prospectus in its entirety. The opinion of MB&D is
directed only to the
6
<PAGE>
exchange ratio at which shares of Pioneer American common stock may be exchanged
for shares of NBT common stock. The opinion of MB&D does not constitute a
recommendation to any holder of NBT common stock as to how such holder should
vote at the NBT annual meeting. The summary of the opinion and the matters
considered in the MB&D analysis set forth in this joint proxy
statement/prospectus is qualified in its entirety by reference to the text of
the opinion itself. The opinion is necessarily based upon conditions as of the
date of the opinion and upon information made available to MB&D through the date
thereof. No limitations were imposed by the NBT Board upon MB&D with respect to
the investigations made, matters considered or procedures followed in the course
of rendering its opinions.
Materials Reviewed by MB&D:
In connection with the rendering and updating of its opinion, MB&D reviewed
the following documents and considered the following subjects:
The merger agreement detailing the pending transaction;
The joint proxy statement/prospectus in substantially the form to be
mailed to NBT shareholders;
Pioneer American Annual Reports to stockholders for 1996, 1997 and
1998;
Pioneer American Annual Reports on Form 10-K for 1996, 1997 and 1998;
Related financial information for the three calendar years ended
December 31, 1996, 1997, and 1998 for Pioneer American;
Pioneer American Quarterly Report on Form 10-Q and related unaudited
financial information for the first three quarters of 1999;
Pioneer American's press release concerning unaudited results for the
calendar years 1998 and 1999;
NBT Annual Reports to Stockholders for 1996, 1997 and 1998;
NBT Annual Reports on Form 10-K and related financial information for
the calendar years ended 1996, 1997 and 1998;
NBT Quarterly Reports on Form 10-Q and related unaudited financial
information for the first three quarters of 1999;
NBT's press release concerning unaudited results for the calendar
years 1998 and 1999;
Internal financial information and financial forecasts, relating to
the business, earnings, cash flows, assets and prospects of the
respective companies furnished to MB&D by Pioneer American and NBT
respectively;
Discussions with members of the senior management of Pioneer American
concerning the past and current results of operations of Pioneer
American, its current financial condition and management's opinion of
its future prospects;
Discussions with members of the senior management of NBT concerning
the past and current results of operations of NBT, its current
financial condition and management's opinion of its future prospects;
The historical record of reported prices, trading volume and dividend
payments for both Pioneer American and NBT common stock;
7
<PAGE>
Based primarily on anecdotal information, the current state of and
future prospects for the economy of New York and northeastern
Pennsylvania generally and the relevant market areas for Pioneer
American and NBT in particular;
Specific merger analysis models developed by MB&D to evaluate
potential business combinations of financial institutions using both
historical reported information and projected information for both
Pioneer American and NBT and the results of application of these
models;
The reported financial terms of selected recent business combinations
of financial institutions for purposes of comparison to the pending
transaction;
Such other studies and analyses as MB&D considered appropriate under
the circumstances associated with this particular transaction.
The opinion of MB&D takes into account its assessment of general economic,
market and financial conditions and its experience in other transactions
involving participants in the financial services industry, as well as its
experience in securities valuation and its knowledge of the banking industry
generally. For purposes of reaching its opinion, MB&D has assumed and relied
upon the accuracy and completeness of the information provided to it or made
available by Pioneer American and NBT and does not assume any responsibility for
the independent verification of such information. With respect to financial
forecasts made available to MB&D it is assumed by MB&D that they were prepared
on a reasonable basis and reflect the best currently available estimates and
good faith judgments of the management of Pioneer American and NBT respectively,
as to the future performance of Pioneer American and NBT. MB&D has also relied
upon assurances of the management of Pioneer American and NBT that they were not
aware of any facts or of the omission of any facts that would make the
information or financial forecasts provided to MB&D incomplete or misleading. In
the course of rendering its opinion, MB&D has not completed any independent
valuation or appraisal of any of the assets or liabilities of either Pioneer
American or NBT and has not been provided with such valuations or appraisals
from any other source.
The following is a summary of the material analyses employed by MB&D in
connection with rendering its written opinion. Given that it is a summary, it
does not purport to be a complete and comprehensive description of all the
analyses performed, or an enumeration of every matter considered by MB&D in
arriving at its opinion. The preparation of a fairness opinion is a complicated
process, involving a determination as to the most appropriate and relevant
methods of financial analysis and the application of those methods to the
particular circumstances. Therefore, such an opinion is not readily susceptible
to a summary description. In arriving at its fairness opinion, MB&D did not
attribute any particular weight to any one specific analysis or factor
considered by it and made qualitative as well as quantitative judgments as to
the significance of each analysis and factor. Therefore, MB&D believes that its
analyses must be considered as a whole and feels that attributing undue weight
to any single analysis or factor considered could create a misleading or
incomplete view of the process leading to the formation of its opinion. In its
analyses, MB&D has made certain assumptions with respect to banking industry
performance, general business and economic conditions and other factors, many of
which are beyond the control of management of either Pioneer American or NBT.
Estimates, which are referred to in the analyses are not necessarily indicative
of actual values or predictive of future results or values, which may vary
significantly from those set forth. In addition, analyses relating to the values
of businesses do not purport to be appraisals or to reflect the prices at which
businesses might actually be sold. Accordingly, such analyses and estimates are
inherently subject to uncertainty and MB&D does not assume responsibility for
the accuracy of such analyses or estimates.
BSB TRANSACTION
On April 20, 2000, NBT announced that it had executed a definitive
agreement to merge with BSB. MB&D has reviewed the agreement with BSB. MB&D
acted as NBT's financial advisor throughout the negotiations with BSB. The
agreement with BSB does not alter MB&D's opinion concerning the NBT/Pioneer
American transaction. MB&D continues to maintain the opinion that as of the date
of this post-effective amendment, the exchange ratio with respect to the merger
between NBT and Pioneer American is fair, from a financial point of view, to NBT
stockholders.
Analysis of the Anticipated Merger and the Fixed Exchange Ratio:
8
<PAGE>
The consideration of 1.805 shares of NBT common stock, valued at the last
sale price of NBT on the day prior to the announcement of the transaction
($16.25) represents the following values and multiples:
Total Transaction Value: $85,337,277
Deal Premium to Pioneer American's last trade: 5.70%
Deal Price / EPS for the last 12 months 20.95x
Deal Price / Tangible Book as of 9/30/99 2.68x
Contribution Analysis:
The following table reflects the acquisition of Lake Ariel on February 17,
2000 and is based on reported financial data for Pioneer American and NBT as of
September 30, 1999 and the per share price of NBT as of December 6, 1999. Under
those circumstances, the relative contributions of the parties to the pro forma
NBT on a pooling basis would have been as follows:
Pro Forma Contribution Table
As of 9-30-99
<TABLE>
<CAPTION>
Item NBT Pioneer American
-------- ------- ------------------
<S> <C> <C>
Proposed Ownership 77.3% 22.7%
Assets 82.1% 17.9%
Loans 83.1% 16.9%
Deposits 82.5% 17.5%
Equity 83.6% 16.4%
Tangible Equity 83.1% 16.9%
Estimated Net Income of Combined 80.7% 19.3%
Company for fiscal year 2000.
Estimated Net Income of Combined Company 76.7% 23.3%
for fiscal year 2001.
</TABLE>
Specific Acquisition Analysis:
MB&D employs a proprietary analytical model to examine transactions
involving banking companies. The model uses forecast earnings data, selected
current period balance sheet and income statement data, current market and
trading information and a number of assumptions as to interest rates for
borrowed funds, the opportunity cost of funds, discount rates, dividend streams,
effective tax rates and transaction structures. The model inquires into the
likely economic feasibility of a given transaction at a given price level or
specified exchange rate while employing a specified transaction structure. The
model also permits evaluation of various levels of potential non-interest
expense savings which might be achieved along with various potential
implementation time tables for such savings, as well as the possibility of
revenue enhancement opportunities which may arise in a given transaction.
Utilizing this model, MB&D prepared pro forma analyses of the financial
impact of the merger to the NBT stockholders. MB&D compared estimated earnings
per share of NBT on a stand alone basis for fiscal year 2000, 2001 and 2002 to
the estimated earnings per share of the common stock of the combined company on
a pro forma basis for the same fiscal years. MB&D's analysis illustrates that
the merger will be dilutive to stockholders of NBT on an earnings per share
basis in fiscal year 2000, and becomes accretive to NBT stockholders in fiscal
year 2001. The transaction remains accretive to stockholders of NBT in fiscal
year 2002.
Analysis of Other Comparable Transactions:
MB&D is reluctant to place emphasis on the analysis of comparable
transactions as a valuation methodology due to what it considers to be inherent
limitations of the application of the results to specific cases. MB&D believes
that such analysis fails to adequately take into consideration such factors as:
9
<PAGE>
Material differences in the underlying capitalization of the
comparable institutions which are being acquired;
Differences in the historic earnings (or loss) patterns recorded by
the compared institutions which can depict a very different trend than
might be implied by examining only recent financial results;
Failure to exclude non-recurring profit or loss items from the last
twelve months' earnings streams of target companies which can distort
apparent earnings multiples;
Material differences in the form or forms of consideration used to
complete the transaction;
Differences between the planned method of accounting for the completed
transaction;
Factors such as: the relative population, business and economic
demographics of the acquired entity's markets as compared or
contrasted to such factors for the markets in which comparable
companies are doing business.
With these reservations in mind, we nonetheless examined statistics
associated with 46 transactions (excluding the subject transaction) involving
commercial banks. The following criteria was utilized to create the sample:
Acquired institutions are all commercial banks.
Announced between June 1, 1998 and December 7, 1999.
Announced deal value greater than $50 million and less than $100
million.
The table which follows permits a comparison of the mean and median values
for two selected statistics arising from the list of 46 transactions evaluated
with the "comparable" statistics calculated for the transaction which is
described in this joint proxy statement/prospectus.
"Comparable" statistics as of the announcement date:
<TABLE>
<CAPTION>
Compared statistics Announced transaction price/tangible Announced transaction price/
book value trailing 12 months earnings
<S> <C> <C>
NBT/Pioneer American 2.68x 20.95x
Sample (46 transactions)
Mean 3.07x 24.5x
Median 3.08x 21.7x
1999 (29 transactions)
Mean 2.96x 23.7x
Median 2.85x 21.5x
1998 (17 transactions)
Mean 3.23x 26.0x
Median 3.19x 23.7x
PA, NJ & NY (8 transactions)
Mean 3.02x 26.6x
Median 2.93x 25.0x
</TABLE>
COMPENSATION OF MB&D
Pursuant to a letter agreement with NBT dated December 7, 1999, MB&D will
receive a fixed fee of $375,000. This fee will be divided into several payments,
which correspond with the successful completion of specific events. MB&D was
paid $75,000 after the execution of the merger agreement and will be paid an
additional $150,000 upon issuance of its opinion which will be included as an
exhibit to this joint proxy statement/prospectus. Payment of the balance of the
fee will be conditioned on closing of the transaction.
10
<PAGE>
The fee payable to MB&D represents compensation for services rendered in
connection with the analysis of the transaction, participation in the
negotiations, participation in the drafting of documentation, and for the
rendering of its Opinion. In addition, NBT has agreed to reimburse MB&D for its
reasonable out-of-pocket expenses incurred in connection with the transaction.
NBT also has agreed to indemnify MB&D and its directors, officers and employees
against certain losses, claims, damages and liabilities relating to or arising
out of its engagement, including liabilities under the federal securities laws.
MB&D has filed a written consent with the SEC relating to the inclusion of
its fairness opinion and the reference to such opinion and to MB&D in the
registration statement in which this joint proxy statement/prospectus is
included. In giving such consent, MB&D did not admit that it comes within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933 or the rules and regulations of the SEC thereunder, nor did MB&D
thereby admit that it is an expert with respect to any part of such Registration
Statement within the meaning of the term "expert" as used in the Securities Act
of 1933 as amended, or the rules and regulations of the SEC thereunder.
OPINION OF PIONEER AMERICAN'S FINANCIAL ADVISOR
Pioneer American retained Danielson Associates, Inc. ("Danielson
Associates") to advise the Pioneer American Board of Directors as to its "fair"
sale value and the fairness to its shareholders of the financial terms of the
offer to be acquired by NBT. Danielson Associates is regularly engaged in the
valuation of banks, bank holding companies, and thrifts in the connection with
mergers, acquisitions, and other securities transactions; and has knowledge of,
and experience with, Pennsylvania and New York banking markets and banking
organizations operating in those markets. Danielson Associates was selected by
Pioneer American because of its knowledge of, expertise with, and reputation in
the financial services industry.
On April 20, 2000, NBT announced an equal merger with BSB, which
represented a material change, and, as a result, required an update of the
original opinion that included the impact of the BSB merger. This update was
delivered to the Board of Directors of Pioneer American stating that as of that
time the financial terms of the NBT offer were still "fair" to Pioneer American
and its shareholders.
Danielson Associates reviewed the Pioneer American-NBT Merger Agreement
with respect to the pricing and other terms and conditions of the Merger, but
the decision as to accepting the offer was ultimately made by the Board of
Directors of Pioneer American. Danielson Associates rendered its oral opinion to
the Pioneer American Board of Directors, which it subsequently confirmed in
writing, that as of the date of such opinion, the financial terms of the NBT
offer were "fair" to Pioneer American and its shareholders. No limitations were
imposed by the Pioneer American Board of Directors upon Danielson Associates
with respect to the investigation made or procedures followed by it in arriving
at its opinion.
In arriving at its original and updated opinions, Danielson Associates:
Reviewed certain business and financial information relating to
Pioneer American, NBT and BSB including annual reports for the fiscal
years ended December 31, 1998 and December 31, 1999; call report data
from 1990 to 1999; and the Annual Reports on Form 10-K and the
Quarterly Reports on Form 10-Q for 1998 and 1999.
Discussed the past and current operations, financial condition and
prospects of NBT with its senior executives.
Analyzed the pro forma impact of all of NBT's announced banking
mergers relative to earnings per share, capitalization, and financial
ratios.
Reviewed the reported prices and trading activity for the NBT Common
Stock and compared it to similar bank holding companies.
Reviewed and compared the financial terms, to the extent publicly
available, with comparable transactions.
11
<PAGE>
Interviewed NBT's and BSB's senior officers relative to the BSB
merger.
Reviewed the Pioneer American-NBT Merger Agreement and certain related
documents.
Reviewed NBT's definitive agreement with BSB and NBT's due diligence
materials relative to BSB.
Considered such other factors as were deemed appropriate.
Danielson Associates did not obtain any independent appraisal of assets or
liabilities of Pioneer American, NBT or BSB or their respective subsidiaries.
Further, Danielson Associates did not independently verify the information
provided by Pioneer American, NBT or BSB and assumed the accuracy and
completeness of all such information.
In arriving at its opinion, Danielson Associates performed a variety of
financial analyses. Danielson Associates believes that its analyses must be
considered as a whole and that consideration of portions of such analyses could
create an incomplete view of Danielson Associates' opinion. The preparation of a
fairness opinion is a complex process involving subjective judgements and is not
necessarily susceptible to partial analysis or summary description.
In its analyses, Danielson Associates made certain assumptions with respect
to industry performance, business and economic conditions, and other matters,
many of which were beyond Pioneer American's or NBT's control. Any estimates
contained in Danielson Associates analyses are not necessarily indicative of
future results of value, which may be significantly more or less favorable than
such estimates. Estimates of the value of companies do not purport to be
appraisals or necessarily reflect the prices at which companies or their
securities may actually be sold.
The following is a summary of selected analyses considered by Danielson
Associates in connection with its opinion letter.
Pro Forma Merger Analyses
Danielson Associates analyzed the changes in the amount of earnings and
book value represented by the receipt of about $62.5 million, based on NBT's
April 19, 2000 stock price, for all of the outstanding shares of Pioneer
American Common Stock and options to purchase Common Stock, which will be paid
in NBT Common Stock or options to purchase NBT Common Stock. The analysis
evaluated, among other things, possible dilution in earnings and capital per
share for NBT Common Stock.
Comparable Companies
To determine the "fair" value of the NBT common stock to be exchanged for
the common stock of Pioneer American, NBT, by itself, and pro forma with BSB was
compared to eleven publicly-traded bank holding companies ("comparable banks" or
the "comparative group"). These comparable banks had assets in the $1 billion to
$3 billion range, no extraordinary characteristics and were located in New
Jersey, New York and Pennsylvania.
Summary and Description of Comparable Banks
<TABLE>
<CAPTION>
Assets*
(In mill.) Headquarters
---------- ------------
<S> <C> <C>
Comparable Banks**
Community Bank System $1,841 DeWitt, N.Y.
Harleysville National 1,636 Harleysville, Pa.
Main Street 1,497 Reading, Pa.
National Penn 2,242 Boyertown, Pa.
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Assets*
(In mill.) Headquarters
---------- ------------
<S> <C> <C>
Omega 1,053 State College, Pa.
Premier National 1,596 Lagrangeville, N.Y.
Sterling Financial 1,059 Lancaster, Pa.
TrustCo 2,364 Schenectady, N.Y.
U.S.B. 1,646 Orangeburg, N.Y.
United National 2,090 Bridgewater, N.J.
Yardville 1,124 Mercerville, N.J.
</TABLE>
* December 31, 1999.
** Publicly-traded with assets between $1 billion and $3 billion in New
Jersey, New York and Pennsylvania.
Source: SNL Securities LC, Charlottesville, Virginia.
Danielson Associates compared NBT's:
Stock price as of April 19, 2000 equal to 8.6 times earnings and
124% of book.
Dividend yield based on trailing four quarters as of December 31,
1999 and stock price as of April 19, 2000 of 6.58%.
Equity and pro forma equity as of December 31, 1999 of 9.08% and
7.73% of assets, respectively.
Nonperforming assets and pro forma nonperforming assets including
loans 90 days past due as of December 31, 1999 equal to .35% and
.48% of total assets, respectively.
Return on average assets and pro forma return on average assets
for 1999 of 1.38% and 1.12%, respectively.
Return on average equity and pro forma return on average equity
during the same period of 14.27% and 13.83%, respectively, with
the medians for the comparable banks.
NBT - Comparable Banks Summary
<TABLE>
<CAPTION>
NBT & Comparable Banks
NBT BSB* Medians
------- ------ ----------------
<S> <C> <C> <C>
Income
Net income/Avg. Assets 1.38% 1.12% 1.26%
Net oper. income**/Avg. Assets 2.47 2.45 2.06
Return on average equity 14.27 13.83 15.22
Balance Sheet
Equity/Assets 9.08% 7.73% 6.59%
NPAs***/Assets .35 .48 .36
Stock Price
Price/Earnings 8.6X -- 12.3X
Price/Book 124% -- 166%
Dividend yield 6.58% -- 4.21%
Payout ratio 47% -- 48%
Shares traded**** 24,307 -- 9,139
</TABLE>
* Excludes one-time merger charge taken by BSB in 1999.
** Net interest income plus noninterest income less operating expense.
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<PAGE>
*** Nonperforming assets including loans 90 days past due and still accruing.
**** Average daily volume in 2000 through April 19, 2000.
Source: SNL Securities LC, Charlottesville, Virginia.
The comparable medians were:
Stock price equal to 12.3 times earnings and 166% of book.
Dividend yield of 4.21%.
Equity of 6.59% of assets.
36% of assets nonperforming.
Return on average assets of 1.26%.
Return on average equity of 15.22%.
Danielson Associates also compared other income, expense and balance sheet
information of such companies with similar information about NBT and BSB.
Comparable Transaction Analysis
Danielson Associates compared the consideration to be paid in the merger to
the latest twelve months earnings and equity capital of Pioneer American with
earnings and capital multiples paid in acquisitions of banks through April 19,
2000 in the Middle Atlantic and Northeast. A specific analysis of Pennsylvania
deals in the last two years was also included. At the time Danielson Associates
made its analysis, the consideration to be paid in the merger was 198% of
Pioneer American's December 31, 1999 book value and 15.3 times reported earnings
for 1999. This compares to the median multiples of 198% of book value and 16.5
times earnings for comparable deals in the Middle Atlantic and Northeast and
16.5 times earnings and 178% of book for comparable deals in Pennsylvania in the
last two years.
Discounted Future Earnings and Discounted Dividends Analysis
Danielson Associates applied present value calculations to Pioneer
American's estimated future earnings and dividend stream under several specific
growth and earnings scenarios. This analysis considered, among other things,
scenarios for Pioneer American as an independent institution and as part of
another banking organization. The projected dividend streams and terminal
values, which were based on a range of earnings multiples, were then discounted
to present value using discount rates based on assumptions regarding the rates
of return required by holders or prospective buyers of Pioneer American common
stock.
Other Analysis
In addition to performing the analyses summarized above, Danielson
Associates also considered the general market for bank mergers, the historical
financial performance of Pioneer American and NBT, the market positions of both
banks and the general economic conditions and prospects of those banks.
No company or transaction used in this composite analysis is identical to
Pioneer American or NBT. Accordingly, an analyses of the results of the
foregoing is not mathematical; rather it involves complex consideration and
judgements concerning differences in financial and operating characteristics of
the companies and other factors that could affect the public trading values of
the company or companies to which they are being compared.
14
<PAGE>
The summary set forth above does not purport to be a complete description
of the analyses and procedures performed by Danielson Associates in the course
of arriving at its opinions. In payment for its services as the financial
advisor to Pioneer American, Danielson Associates is to be paid an estimated fee
of about $310,000.
The full text of the opinion of Danielson Associates dated as of April 20,
2000, which sets forth assumptions made and matters considered, is attached
hereto as Appendix B of this joint proxy statement/prospectus. Pioneer American
stockholders are urged to read this opinion in its entirety. Danielson
Associates' opinion is directed only to the consideration to be received by
Pioneer American stockholders in the Merger and does not constitute a
recommendation to any Pioneer American stockholder as to how such shareholder
should vote at the stockholders meeting.
PRICE RANGE OF COMMON STOCK AND DIVIDENDS
NBT common stock trades on the Nasdaq National Market under the symbol
"NBTB." Following the merger, the shares of NBT common stock will continue to
trade on the Nasdaq National Market under that symbol. Pioneer American common
stock trades on the over-the-counter market under the symbol "PAHC.OB."
Following the merger, NBT will deregister the Pioneer American common stock
under the Exchange Act, and the common stock of Pioneer American will cease
trading in the over-the-counter market.
The following table has been restated to reflect the payment by NBT on
December 15, 1999 of a 5% stock dividend and sets forth for the periods
indicated (1) the range of high and low sales prices of the NBT common stock and
the Pioneer American common stock, and (2) the amount of cash dividends declared
per share by each company:
<TABLE>
<CAPTION>
NBT PIONEER AMERICAN
----- ------------------
SALES PRICES SALES PRICES
------------ --------------
HIGH LOW DIVIDENDS HIGH LOW DIVIDENDS
------- ----- ----------- --------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
1998
First Quarter $19.05 $15.99 $ 0.117 $23.50 $21.38 $0.190
Second Quarter 23.48 18.37 0.154 25.25 22.50 0.190
Third Quarter 23.81 17.58 0.154 24.50 22.00 0.190
Fourth Quarter 24.29 19.72 0.162 23.50 22.00 0.200
1999
First Quarter $23.33 $19.89 $ 0.162 $22.50 $19.00 $ 0.200
Second Quarter 21.19 19.05 0.162 28.00 19.13 0.200
Third Quarter 20.90 16.43 0.162 26.00 20.75 0.200
Fourth Quarter 17.98 14.63 0.170 30.00 23.50 0.200
2000
First Quarter $16.50 $11.38 $0.170 $27.25 $19.75 $0.200
Second Quarter (through
May __, 2000)
</TABLE>
The timing and amount of future dividends will depend upon earnings, cash
requirements, and financial condition of NBT and its subsidiaries and, following
the merger of NBT and BSB, the earnings, cash requirements, and financial
condition of the surviving corporation (and, prior to completion of the merger,
the earnings, cash requirements, and financial condition of Pioneer American and
its subsidiary insofar as Pioneer American dividends are concerned), applicable
government regulations, and other factors deemed relevant by the NBT Board and
the board of directors of the surviving corporation following the merger of NBT
and BSB (and by the Pioneer American Board prior to completion of the merger of
NBT and Pioneer American). Various federal and state laws limit the ability of
affiliated banks to pay dividends to NBT and Pioneer American. The merger
agreement with Pioneer American restricts the cash dividends payable on Pioneer
American common stock pending completion of the merger.
15
<PAGE>
On May , 2000, the most recent practicable date prior to the printing of
this supplement, the last reported sales price of NBT common stock was $ per
share. On May , 2000, the most recent practicable date prior to the printing of
this supplement, the last reported sales price of Pioneer American common stock
was $ per share. We urge stockholders to obtain current market quotations prior
to making any decisions with respect to the merger.
As of April 30, 2000, there were 4,676 holders of record of NBT common
stock and 1,434 holders of record of Pioneer American common stock.
EXPERTS
The consolidated financial statements and the supplemental consolidated
financial statements of NBT as of December 31, 1999 and 1998 and for each of the
years in the three-year period ended December 31, 1999 have been incorporated by
reference in this supplement and registration statement in reliance upon the
reports of KPMG LLP, independent certified public accountants, which are
incorporated herein by reference, and upon the authority of said firm as experts
in accounting and auditing.
The consolidated financial statements of Pioneer American as of December
31, 1999 and 1998 and for each of the years in the three-year period ended
December 31, 1999, have been incorporated by reference in this supplement and
registration statement in reliance upon the report of KPMG LLP, independent
certified public accountants, incorporated herein by reference, and upon the
authority of said firm as experts in accounting and auditing.
The consolidated financial statements of BSB Bancorp, Inc. as of December
31, 1999 and 1998 and for each of the years in the three-year period ended
December 31, 1999 have been incorporated by reference in this supplement and
registration statement in reliance upon the report of PricewaterhouseCoopers
LLP, independent certified public accountants, incorporated herein by reference
and upon the authority of said firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
NBT and Pioneer American file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
reports, statements or other information we file at the SEC's public reference
room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from commercial document retrieval
services and at the web site maintained by the SEC at http://www.sec.gov. In
addition, you may read and copy NBT's SEC filings at the Nasdaq National Market,
1735 K Street, N.W., Washington, D.C. 20006-1500, and Pioneer American's SEC
filings at Nasdaq, 1735 K Street, N.W., Washington, D.C. 20006-1500. Our
Internet addresses are www.nbtbank.com with respect to NBT and
www.pioneeramerican.com with respect to Pioneer American.
NBT has filed a registration statement on Form S-4 to register with the SEC
the NBT common stock to be issued to the holders of Pioneer American common
stock in the merger. This supplement is a part of that registration statement
and constitutes a prospectus of NBT in addition to being a proxy statement of
NBT and Pioneer American for the NBT adjourned annual meeting and the Pioneer
American adjourned special meeting. As allowed by SEC rules, this supplement
does not contain all the information you can find in the registration statement
or the exhibits to the registration statement.
The SEC allows us to "incorporate by reference" information into this
supplement, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is deemed to be part of this supplement, except for
any information superseded by information in this supplement. This supplement
incorporates by reference the documents set forth below that we have previously
filed with the SEC. These documents contain important information about the
companies, their finances and NBT common stock.
16
<PAGE>
NBT BANCORP INC. SEC FILINGS
Annual Report on Form 10-K for the year ended December 31, 1999; and
Current Reports on Form 8-K, filed with the SEC on February 22, 2000,
March 3, 2000, March 31, 2000 and April 28, 2000.
On March 31, 2000, NBT filed a Current Report on Form 8-K with the SEC. The
report contains supplemental consolidated financial statements of NBT as of
December 31, 1999 and 1998 and for each of the years in the three year period
ended December 31, 1999, which have been restated to include the effects of the
Lake Ariel Bancorp, Inc.merger, which was accounted for as a pooling of
interests.
PIONEER AMERICAN HOLDING COMPANY CORP. SEC FILINGS
Annual Report on Form 10-K for the year ended December 31, 1999; and
Current Report on Form 8-K, filed with the SEC on January 4, 2000.
We incorporate by reference additional documents that we file with the SEC
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act between the
date of this supplement and the effective time of the merger.
NBT has supplied all information contained or incorporated by reference in
this supplement relating to NBT, and Pioneer American has supplied all such
information relating to Pioneer American.
If you are a stockholder, we may have sent you some of the documents
incorporated by reference, but you can obtain any of them through us or the SEC.
You can obtain documents incorporated by reference from us without charge,
excluding all exhibits unless we have specifically incorporated by reference an
exhibit in this supplement. Stockholders may obtain documents incorporated by
reference in this supplement by requesting them in writing or by telephone from
the appropriate party at the following address:
NBT Bancorp Inc. Pioneer American Holding Company Corp.
52 South Broad Street 41 North Main Street
Norwich, New York 13815 Carbondale, PA 18407
Attention: Michael J. Chewens, CPA Attention: Patricia A. Cobb, Esq.
Tel: (607) 337-6520 Tel: (570) 282-8045
If you would like to request documents from us, please do so by June 13,
2000 to receive them prior to the reconvened NBT annual meeting and reconvened
Pioneer American special meeting.
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS SUPPLEMENT TO VOTE ON THE NBT PROPOSAL AND THE PIONEER
AMERICAN PROPOSAL. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION
THAT IS DIFFERENT FROM WHAT IS CONTAINED IN THIS SUPPLEMENT. THIS SUPPLEMENT IS
DATED MAY , 2000. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS
SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN SUCH DATE, AND NEITHER THE
MAILING OF THIS SUPPLEMENT TO STOCKHOLDERS NOR THE ISSUANCE OF SHARES OF NBT
COMMON STOCK IN THE MERGER SHALL CREATE ANY IMPLICATION TO THE CONTRARY.
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined balance sheet presents the
financial position of NBT, Pioneer American and BSB Bancorp, Inc. as of December
31, 1999, assuming that each merger had occurred as of December 31, 1999, after
giving effect to certain pro forma adjustments described in the accompanying
notes. The following unaudited pro forma combined statements of income for the
years ended December 31, 1999, 1998 and 1997 present the combined historical
results of operations of NBT, Pioneer American and BSB as if each merger had
been consummated as of the first day of the period presented. The financial
information for NBT has been restated to include the effects of the merger with
Lake Ariel Bancorp, Inc., which was consummated on February 17, 2000 and has
been
17
<PAGE>
accounted for as a pooling of interests. Pro forma earnings per common share are
based on the exchange ratio of 1.805 with respect to the Pioneer American merger
and 2.0 with respect to the merger with BSB. The fiscal years of NBT, Pioneer
American and BSB end December 31. The unaudited pro forma combined balance sheet
reflects estimated non-recurring charges that will be incurred in connection
with the mergers.
The unaudited pro forma combined financial statements were prepared giving
effect to each merger on the pooling of interests accounting method. Under this
method of accounting, the recorded assets, liabilities, stockholders' equity,
income and expense of NBT, Pioneer American and BSB are combined and reflected
at their historical amounts, except as noted in the accompanying notes.
The combined company expects to achieve certain merger benefits in the form
of operating expense reductions and revenue enhancements. The unaudited pro
forma combined statements of income do not reflect potential operating expense
reductions or revenue enhancements that are expected to result from the mergers,
and therefore may not be indicative of the results of future operations. No
assurance can be given with respect to the ultimate level of operating expense
reductions or revenue enhancements.
The unaudited pro forma combined financial statements should be read in
conjunction with, and are qualified in their entirety by, the historical
consolidated financial statements and accompanying notes of NBT, Pioneer
American and BSB and the supplemental consolidated financial statements of NBT
and accompanying notes, which have been restated to include the effects of the
Lake Ariel merger. All of these financial statements are incorporated by
reference into this supplement. The unaudited pro forma combined financial
statements are presented for informational purposes only. These statements are
not necessarily indicative of the combined financial position and results of
operations that would have occurred if the mergers had been consummated on
December 31, 1999 or at the beginning of the periods or that may be attained in
the future.
18
<PAGE>
<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONDENSED
COMBINED BALANCED SHEET
AT DECEMBER 31, 1999
PIONEER NBT
AMERICAN PIONEER
HOLDING AMERICAN
NBT COMPANY PRO FORMA COMBINED
BANCORP INC. CORP. ADJUSTMENTS PRO FORMA
------------ ---------- ----------- ---------
<S> <C> <C> <C> <C>
(in thousands)
ASSETS
Cash and cash equivalents $ 64,431 $ 15,198 $ -- $ 79,629
Securities available for sale, at fair value 520,440 112,134 -- 632,574
Securities held to maturity (fair value-NBT Bancorp
Inc. $75,155, Pioneer American Holding Company
Corp.$35,499 and BSB Bancorp, Inc. $14,588) 78,213 36,612 -- 114,825
Loans: 1,222,654 244,213 -- 1,466,867
Less: Allowance for loan losses 16,654 3,057 -- 19,711
---------- --------- ---------
Net Loans 1,206,000 241,156 -- 1,447,156
Premises and equipment, net 40,830 6,267 -- 47,097
Other assets 51,518 7,408 3,300(6) 62,226
---------- --------- ---------
TOTAL ASSETS $ 1,961,432 $ 418,775 $ 3,300 $ 2,383,507
========== ========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest bearing) $223,143 $ 44,752 $ -- $ 267,895
Savings, NOW, and money market 487,746 117,588 -- 605,334
Time 766,729 137,133 -- 903,862
---------- --------- ---------
Total deposits 1,477,618 299,473 -- 1,777,091
Short-term borrowings 137,567 4,700 -- 142,267
Long-term debt 172,575 79,395 -- 251,970
Other liabilities 13,798 3,609 12,300(6) 29,707
Mandatory redemmable preferred securities of subsidiary -- -- -- --
---------- --------- -------- ---------
Total liabilities 1,801,558 387,177 12,300 2,201,035
---------- --------- -------- ---------
Commitments and contingencies
Stockholders' equity:
Preferred stock -- -- -- --
Common stock 18,489 2,935 2,235(2) 23,659
Capital surplus 148,242 11,962 (3,965)(2) 156,239
Retained earnings 23,060 21,889 (9,000)(6) 35,949
Accumulated other comprehensive income (loss) (18,252) (3,458) -- (21,710)
Common stock in treasury at cost (11,665) (1,730) 1,730(2) (11,665)
Total stockholders' equity 159,874 31,598 (9,000) 182,472
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 1,961,432 $418,775 $ 3,300 $ 2,383,507
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NBT
PIONEER
AMERICAN
BSB
BSB BANCORP, PRO FORMA COMBINED
INC. ADJUSTMENTS PRO FORMA
------------ ------------ ---------
<S> <C> <C> <C>
(in thousands)
ASSETS
Cash and cash equivalents $ 70,065 $ -- $ 149,694
Securities available for sale, at fair value 387,251 -- 1,019,825
Securities held to maturity (fair value-NBT Bancorp
Inc. $75,155, Pioneer American Holding Company
Corp. $35,499 and BSB Bancorp, Inc. $14,588) 14,472 -- 129,297
Loans: 1,724,973 -- 3,191,840
Less: Allowance for loan losses 29,134 -- 48,845
--------- ---------
Net Loans 1,695,839 -- 3,142,995
Premises and equipment, net 15,988 -- 63,085
Other assets 57,333 4,500(6) 124,059
--------- ---------
TOTAL ASSETS $ 2,240,948 $ 4,500 $ 4,628,955
========= ====== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Demand (noninterest bearing) $ 141,907 $ -- $409,802
Savings, NOW, and money market 647,987 -- 1,253,321
Time 1,111,310 -- 2,015,172
--------- ---------
Total deposits 1,901,204 -- 3,678,295
Short-term borrowings 119,048 -- 261,315
Long-term debt 22,997 -- 274,967
Other liabilities 13,206 16,500(6) 59,413
Mandatory redemmable preferred securities of subsidiary 30,000 -- 30,000
--------- ------ ---------
Total liabilities 2,086,455 16,500 4,303,990
--------- ------ ---------
Commitments and contingencies
Stockholders' equity:
Preferred stock -- -- --
Common stock 114 20,337(5) 44,110
Capital surplus 37,287 (33,783)(5) 159,743
Retained earnings 140,295 (12,000)(6) 164,244
Accumulated other comprehensive income (loss) (9,757) -- (31,467)
Common stock in treasury at cost (13,446) 13,446(5) (11,665)
Total stockholders' equity 154,493 (12,000) 324,965
--------- ------- ---------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 2,240,948 $ 4,500 $ 4,628,955
=========== ========= ===========
</TABLE>
See accompanying notes to the unaudited pro forma combined financial statements.
19
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1999
PIONEER NBT
AMERICAN PIONEER
NBT HOLDING AMERICAN
BANCORP COMPANY PRO FORMA COMBINED
INC. CORP. ADJUSTMENTS PRO FORMA
----------- ---------- -------------- -----------
<S> <C> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $ 96,235 $ 19,661 $ -- $ 115,896
Securities - taxable 34,956 8,223 -- 43,179
Securities - tax-exempt 3,210 1,268 -- 4,478
Other 988 237 -- 1,225
--------- ---------- -------- ----------
Total interest and fee income 135,389 29,389 -- 164,778
--------- ---------- -------- ----------
Interest expense:
Deposits 46,067 10,519 -- 56,586
Borrowings 14,515 4,379 -- 18,894
--------- ---------- -------- ----------
Total interest expense 60,582 14,898 75,480
--------- ---------- -------- ----------
Net interest income 74,807 14,491 -- 89,298
Provision for loan losses 5,070 370 -- 5,440
--------- ---------- -------- ----------
Net interest income after provision for loan losses 69,737 14,121 -- 83,858
--------- ---------- -------- ----------
Noninterest income:
Trust 3,305 -- -- 3,305
Service charges on deposit accounts 6,303 1,635 -- 7,938
Net securities gains (losses) 1,716 88 -- 1,804
Other 5,097 1,108 -- 6,205
--------- ---------- -------- ----------
Total noninterest income 16,421 2,831 -- 19,252
--------- ---------- -------- ----------
Noninterest expense:
Salaries and employee benefits 25,213 5,291 -- 30,504
Office supplies and postage 2,436 534 -- 2,970
Occupancy 4,317 1,062 -- 5,379
Equipment 4,230 990 -- 5,220
Professional fees and outside services 3,325 1,005 -- 4,330
Data processing and communications 4,091 437 -- 4,528
Amortization of intangible assets 1,278 39 -- 1,317
Acquisition charges -- -- -- --
Other operating 6,610 2,024 -- 8,634
--------- ---------- -------- ----------
Total noninterest expense 51,500 11,382 -- 62,882
--------- ---------- -------- ----------
Income before income taxes 34,658 5,570 -- 40,228
Income taxes 12,483 1,488 -- 13,971
--------- ---------- -------- ----------
Net income $ 22,175 $ 4,082 $ -- $ 26,257
========= ========== ======== ==========
Weighted Average Shares Outstanding:
Basic 17,851 2,902 -- 23,089
Diluted 18,095 2,929 -- 23,382
Earnings per share:
Basic $ 1.24 $ 1.41 -- $ 1.14
Diluted $ 1.23 $ 1.39 -- $ 1.12
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NBT
PIONEER
AMERICAN
BSB BSB
BANCORP, PRO FORMA COMBINED
INC, ADJUSTMENTS PRO FORMA
---------- -------------- -----------
<S> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $ 151,001 $ -- $ 266,897
Securities - taxable 24,113 -- 67,292
Securities - tax-exempt 925 -- 5,403
Other 682 1,907
--------- -------- ---------
Total interest and fee income 176,721 -- 341,499
--------- -------- ---------
Interest expense:
Deposits 75,542 -- 132,128
Borrowings 14,034 -- 32,928
--------- -------- ---------
Total interest expense 89,576 -- 165,056
--------- -------- ---------
Net interest income 87,145 -- 176,443
Provision for loan losses 19,137 -- 24,577
--------- -------- ---------
Net interest income after provision for loan losses 68,008 -- 151,866
--------- -------- ---------
Noninterest income:
Trust 1,104 -- 4,409
Service charges on deposit accounts 4,382 -- 12,320
Net securities gains (losses) (231) -- 1,573
Other 7,116 -- 13,321
--------- -------- ---------
Total noninterest income 12,371 -- 31,623
--------- -------- ---------
Noninterest expense:
Salaries and employee benefits 20,386 -- 50,890
Office supplies and postage 1,684 -- 4,654
Occupancy 2,874 -- 8,253
Equipment 1,733 -- 6,953
Professional fees and outside services 6,001 -- 10,331
Data processing and communications 1,930 -- 6,458
Amortization of intangible assets 386 -- 1,703
Acquisition charges 5,408 -- 5,408
Other operating 10,261 -- 18,895
--------- -------- ---------
Total noninterest expense 50,663 -- 113,545
--------- -------- ---------
Income before income taxes 29,716 -- 69,944
Income taxes 11,491 -- 25,462
--------- -------- ---------
Net income $ 18,225 $ -- $ 44,482
========= ======== =========
Weighted Average Shares Outstanding:
Basic 10,138 43,365
Diluted 10,312 44,006
Earnings per share:
Basic $ 1.80 $ 1.03
Diluted $ 1.77 $ 1.01
--
</TABLE>
See accompanying notes to the unaudited pro forma combined financial statements.
20
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1998
PIONEER NBT
AMERICAN PIONEER
HOLDING AMERICAN
NBT COMPANY PRO FORMA COMBINED
BANCORP INC. CORP. ADJUSTMENTS PRO FORMA
-------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $ 89,399 $ 19,093 $ -- $ 108,492
Securities - taxable 37,590 7,615 -- 45,205
Securities - tax-exempt 2,780 1,114 -- 3,894
Other 531 480 -- 1,011
--------- -------- --------- -----------
Total interest and fee income 130,300 28,302 -- 158,602
--------- -------- --------- -----------
Interest expense:
Deposits 48,058 10,840 -- 58,898
Borrowings 12,359 3,479 -- 15,838
--------- -------- --------- -----------
Total interest expense 60,417 14,319 -- 74,736
--------- -------- --------- -----------
Net interest income 69,883 13,983 -- 83,866
Provision for loan losses 5,729 420 -- 6,149
--------- -------- --------- -----------
Net interest income after provision for loan losses 64,154 13,563 -- 77,717
--------- -------- --------- -----------
Noninterest income:
Trust 3,115 -- -- 3,115
Service charges on deposit accounts 5,325 1,404 -- 6,729
Net securities gains (losses) 1,056 511 -- 1,567
Other 5,417 1,046 -- 6,463
--------- -------- --------- -----------
Total noninterest income 14,913 2,961 -- 17,874
--------- -------- --------- -----------
Noninterest expense:
Salaries and employee benefits 24,215 5,071 -- 29,286
Office supplies and postage 2,523 506 -- 3,029
Occupancy 4,132 1,027 -- 5,159
Equipment 3,599 773 -- 4,372
Professional fees and outside services 3,375 1,027 -- 4,402
Data processing and communications 3,796 483 -- 4,279
Amortization of intangible assets 1,275 39 -- 1,314
Other operating 7,665 2,041 -- 9,706
-------- -------- --------- -----------
Total noninterest expense 50,580 10,967 -- 61,547
-------- -------- --------- -----------
Income before income taxes 28,487 5,557 -- 34,044
Income taxes 5,614 1,535 -- 7,149
-------- -------- --------- -----------
Net income $ 22,873 $ 4,022 $ -- $ 26,895
======== ======== ========= ===========
Weighted Average Shares Outstanding:
Basic 17,976 2,894 -- 23,199
Diluted 18,361 2,953 -- 23,691
Earnings per share:
Basic $ 1.27 $ 1.39 $ -- $ 1.16
Diluted $ 1.25 $ 1.36 $ -- $ 1.14
</TABLE>
See accompanying notes to the unaudited pro forma
combined financial statements.
<TABLE>
<CAPTION>
NBT
PIONEER
AMERICAN
BSB BSB
BANCORP, PRO FORMA COMBINED
INC. ADJUSTMENTS PRO FORMA
----------- ------------- ----------
<S> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $ 139,374 $ -- $247,866
Securities - taxable 25,220 -- 70,425
Securities - tax-exempt 706 -- 4,600
Other 866 -- 1,877
------- ----- ------
Total interest and fee income 166,166 -- 324,768
------- ----- ------
Interest expense:
Deposits 72,387 -- 131,285
Borrowings 12,399 -- 28,237
------ -- ------
Total interest expense 84,786 -- 159,522
------ -- -------
Net interest income 81,380 -- 165,246
Provision for loan losses 12,931 -- 19,080
------ -- ------
Net interest income after provision for loan losses 68,449 -- 146,166
------ -- -------
Noninterest income:
Trust 994 -- 4,109
Service charges on deposit accounts 3,714 -- 10,443
Net securities gains (losses) (851) -- 716
Other 4,738 -- 11,201
----- ----- ------
Total noninterest income 8,595 -- 26,469
------ ------ ------
Noninterest expense:
Salaries and employee benefits 19,528 -- 48,814
Office supplies and postage 1,998 -- 5,027
Occupancy 2,911 -- 8,070
Equipment 1,466 -- 5,838
Professional fees and outside services 4,086 -- 8,488
Data processing and communications 2,027 -- 6,306
Amortization of intangible assets 386 -- 1,700
Other operating 9,581 19,287
----- ------
Total noninterest expense 41,983 103,530
------ -------
Income before income taxes 35,061 -- 69,105
Income taxes 13,542 20,691
------ ------
Net income $ 21,519 $ -- $ 48,414
====== ======
Weighted Average Shares Outstanding:
Basic 10,006 -- 43,211
Diluted 10,365 -- 44,421
Earnings per share:
Basic $ 2.15 $ -- $ 1.12
Diluted $ 2.08 $ -- $ 1.09
</TABLE>
21
<PAGE>
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1997
PIONEER NBT
AMERICAN PIONEER
NBT HOLDING AMERICAN
BANCORP COMPANY PRO FORMA COMBINED
INC. CORP. ADJUSTMENTS PRO FORMA
---------- ----------- ---------------- ------------
<S> <C> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $ 81,688 $ 18,101 $ -- $ 99,789
Securities - taxable 35,779 7,063 -- 42,842
Securities - tax-exempt 2,757 1,023 -- 3,780
Other 607 320 -- 927
-------- ------ ------ -------
Total interest and fee income 120,831 26,507 -- 147,338
-------- ------ ------ -------
Interest expense:
Deposits 45,629 11,337 -- 56,966
Borrowings 10,418 1,508 -- 11,926
-------- ------ ------ -------
Total interest expense 56,047 12,845 -- 68,892
-------- ------ ------ -------
Net interest income 64,784 13,662 -- 78,446
Provision for loan losses 4,285 535 -- 4,820
-------- ------ ------ -------
Net interest income after provision for loan losses 60,499 13,127 -- 73,626
-------- ------ ------ -------
Noninterest income:
Trust 2,675 -- -- 2,675
Service charges on deposit accounts 4,942 1,397 -- 6,339
Net securities gains (losses) (123) 157 -- 34
Other 3,973 907 -- 4,880
-------- ------ ------ -------
Total noninterest income 11,467 2,461 -- 13,928
-------- ------ ------ -------
Noninterest expense:
Salaries and employee benefits 22,111 5,040 -- 27,151
Office supplies and postage 2,250 507 -- 2,757
Occupancy 3,754 1,026 -- 4,780
Equipment 2,632 685 -- 3,317
Professional fees and outside services 2,485 900 -- 3,385
Data processing and communications 2,966 456 -- 3,422
Amortization of intangible assets 1,505 39 -- 1,544
Other operating 6,677 1,427 -- 8,104
-------- ------ ------ -------
Total noninterest expense 44,380 10,080 -- 54,460
-------- ------ ------ -------
Income before income taxes 27,586 5,508 -- 33,094
Income taxes 9,406 1,500 -- 10,906
-------- ------ ------ -------
Net income $ 18,180 $ 4,008 $ $ 22,188
======== ====== ====== =======
Weighted Average Shares Outstanding:
Basic 17,095 2,850 -- 22,239
Diluted 17,393 2,939 -- 22,698
Earnings per share:
Basic $ 1.06 $ 1.41 $ -- $ 1.00
Diluted $ 1.05 $ 1.36 $ -- $ 0.98
</TABLE>
See accompanying notes to the unaudited pro forma combined financial statements.
<PAGE>
<TABLE>
<CAPTION>
NBT
PIONEER
AMERICAN
BSB BSB
BANCORP, PRO FORMA COMBINED
INC. ADJUSTMENTS PRO FORMA
------------ -------------- ----------
<S> <C> <C> <C>
Consolidated Statement of Income:
(in thousands, except per share data)
Interest and fee income:
Loans and loans held for sale $120,750 $ -- $220,539
Securities - taxable 19,373 -- 62,215
Securities - tax-exempt 1,025 -- 4,805
Other 200 -- 1,127
------- ------- --------
Total interest and fee income 141,348 -- 288,686
------- ------- --------
Interest expense:
Deposits 60,180 -- 117,146
Borrowings 11,272 -- 23,198
------- ------- --------
Total interest expense 71,452 -- 140,344
------- ------- --------
Net interest income 69,896 -- 148,342
Provision for loan losses 10,814 -- 15,634
------- ------- --------
Net interest income after provision for loan losses 59,082 -- 132,708
------- ------- --------
Noninterest income:
Trust 709 -- 3,384
Service charges on deposit accounts 3,297 -- 9,636
Net securities gains (losses) 380 -- 414
Other 3,762 -- 8,642
------- ------- --------
Total noninterest income 8,148 -- 22,076
------- ------- --------
Noninterest expense:
Salaries and employee benefits 17,121 -- 44,272
Office supplies and postage 1,886 -- 4,643
Occupancy 2,547 -- 7,327
Equipment 1,378 -- 4,695
Professional fees and outside services 2,716 -- 6,101
Data processing and communications 1,358 -- 4,780
Amortization of intangible assets 386 -- 1,930
Other operating 9,548 17,652
------- --------
Total noninterest expense 36,940 91,400
------- - ------
Income before income taxes 30,290 -- 63,384
Income taxes 11,641
-------
Net income $ 18,649 $ -- $ 40,837
======= ======= =======
Weighted Average Shares Outstanding:
Basic 9,905 -- 42,049
Diluted 10,258 -- 43,214
Earnings per share:
Basic $ 1.88 $ -- $ 0.97
Diluted $ 1.82 $ -- $ 0.94
</TABLE>
22
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(1) Pro forma earnings per common share (EPS) have been calculated based on the
weighted average number of shares of NBT plus additional shares of NBT assumed
to be issued in the mergers in exchange for the weighted average outstanding
shares of Pioneer American and BSB for each applicable period based on the
exchange ratios of 1.805 and 2.0, respectively.
(2) Pro forma entry to issue 1.805 shares of NBT Bancorp Inc. Common Stock in
exchange for each share of Pioneer American Holding Company Corp. Common Stock.
The stated value of NBT Bancorp Inc. Common Stock to be issued is determined as
follows:
<TABLE>
<S> <C> <C>
NBT Bancorp Inc. common shares issued at December 31, 1999 18,488,347
Pioneer American Holding Company Corp. common shares issued, after
retirement of treasury stock
(2,864,307 common shares times conversion
ratio of 1.805) 5,170,074
Combined pro forma total common share issued 23,658,421
Stated value per common share $ 1.00
Combined pro forma total stated value $23,658,421
Actual stated value of common stock at December 31, 1999:
NBT Bancorp Inc. $18,488,347
Pioneer American Holding Company Corp.
(after retirement of treasury shares) 2,864,307 $21,352,654
Required increase in stated value $ 2,305,767
Entry to conform to stated value of common stock:
Surplus $ 2,305,767
Common stock $ 2,305,767
Pro forma entry to retire treasury stock held by Pioneer
(approximately 71,060 shares having a par value of $1.00
per share)
Common Stock $ 71,060
Surplus $ 1,658,739
Treasury Stock $ 1,729,799
Summary of pro forma entries above
Surplus $ 3,964,506
Common stock $ 2,234,707
Treasury Stock $ 1,729,799
</TABLE>
(3) Authorized, issued and outstanding share information is as follows at
December 31, 1999:
<TABLE>
<CAPTION>
NBT PIONEER NBT/PIONEER PRO FORMA
----------- -------------- -------------------------
<S> <C> <C> <C>
Preferred
Authorized 2,500,000 -- 2,500,000
Issued and Outstanding -- -- --
Common
Stated Value $1.00 $1.00 $1.00
Authorized 15,000,000(A) 25,000,000 15,000,000(A)
Issued 18,488,347 2,935,367 23,658,421
Outstanding 17,949,411 2,864,307 23,119,485
</TABLE>
23
<PAGE>
(A) On February 17, 2000, stockholders of NBT Bancorp Inc. approved an
amendment to its Certificate of Incorporation increasing the number of
authorized common shares from 15 million to 30 million and changing the par
value of the NBT capital stock from no par value, $1.00 stated value, to $.01
par value per share..
(4) Pro forma entry to retire treasury stock held by BSB Bancorp, Inc.
(approximately 1,173,669 shares having a par value of $.01 per share)
<TABLE>
<S> <C>
Common stock $ 11,737
Surplus $13,434,263
Treasury stock $13,446,000
</TABLE>
(5) Pro forma entry to issue 2.0 shares of NBT Bancorp Inc. common stock in
exchange for each share of BSB Bancorp, Inc. common stock. The stated value
of NBT Bancorp Inc. common stock to be issued at December 31, 1999 is
determined as follows:
<TABLE>
<S> <C> <C>
NBT Bancorp Inc. / Pioneer combined pro forma common shares issued 23,658,421
BSB Bancorp, Inc. common shares issued, after
retirement of treasury stock
(10,225,322 common shares times conversion
ratio of 2.0) 20,450,644
-----------
Combined pro forma total common shares issued 44,109,065
Stated value per common share $ 1.00
-----------
Combined pro forma total stated value $ 44,109,065
Actual stated value of common stock at December 31, 1999:
NBT Bancorp Inc. / Pioneer combined pro forma $23,658,421
BSB Bancorp, Inc. (after retirement of treasury stock ) 102,253 $ 23,760,674
-------------- ------------
Required increase in stated value $ 20,348,391
============
Entry to conform to stated value of common stock:
Surplus $ 20,348,391
Common stock $ 20,348,391
</TABLE>
24
<PAGE>
Summary of pro forma entries from notes (4) and (5) above
<TABLE>
<S> <C> <C>
Surplus $33,782,654
Common stock $ 20,336,654
Treasury stock $ 13,446,000
</TABLE>
(6) The unaudited pro forma combined balance sheet at December 31, 1999,
reflects anticipated non-recurring merger and integration costs for the Lake
Ariel, Pioneer American and BSB mergers. Costs related to the Lake Ariel merger
are estimated to be in the range of $6.7 million to $7.7 million ($4.7 million
to $5.7 million after taxes) and costs related to the Pioneer American merger
are estimated to be in the range of $4.6 million to $5.6 million ($3.3 million
to $4.3 million after taxes). Costs related to the BSB merger are estimated to
be in the range of $16.0 million to $17.0 million ($11.5 million to $12.5
million after taxes). These estimates include primarily investment banking,
legal, accounting, printing, data processing and systems integration costs, and
employee and contract termination costs. Anticipated merger and integration cost
estimates are not included in the unaudited pro forma combined statements of
income for any of the periods presented.
The pro forma statements do not reflect potential expense reductions or
revenue enhancements expected to be realized subsequent to consummation of the
mergers.
The entries to record the anticipated merger and integration costs on the
unaudited pro forma combined balance sheet are:
<TABLE>
<S> <C> <C>
Lake Ariel
Current Tax Receivable $2,000,000
Retained Earnings $5,200,000
Other Liabilities $ 7,200,000
Pioneer American
Current Tax Receivable $1,300,000
Retained Earnings $3,800,000
Other Liabilities $ 5,100,000
Summary of pro forma entries above
Current Tax Receivable $3,300,000
Retained Earnings $9,000,000
Other Liabilities $12,300,000
BSB
Current Tax Receivable $4,500,000
Retained Earnings $12,000,000
Other Liabilities $16,500,000
</TABLE>
25
<PAGE>
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
NBT and Pioneer American have used and incorporated by reference
"forward-looking statements" in this supplement. Words such as "will," "will
permit," "will afford," "believes," "expects," "may," "should," "projected,"
"contemplates," or "anticipates" may constitute forward-looking statements.
These statements are within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934 and are subject to
risks and uncertainties that could cause our actual results to differ
materially. NBT and Pioneer American have used these statements to describe our
expectations and estimates in various sections of this supplement, including:
Presidents' Letter to the Stockholders;
Proposed Merger Between NBT and BSB;
Revised Fairness Opinions by Financial Advisors -- Opinion of NBT's
Financial Advisor;
Revised Fairness Opinions by Financial Advisors -- Opinion of Pioneer
American's Financial Advisor; and
Unaudited Pro Forma Combined Financial Statements.
Factors that might cause such differences include, but are not limited to:
the timing of closing the proposed mergers being delayed; competitive pressures
among financial institutions increasing significantly; economic conditions,
either nationally or locally in areas in which NBT, Pioneer American and BSB
conduct their operations, being less favorable than expected; the cost and
effort required to integrate aspects of the operations of the companies being
more difficult than expected; expected cost savings from the proposed mergers
not being fully realized or realized within the expected time frame; legislation
or regulatory changes which adversely affect the ability of the combined company
to conduct its current and future operations; and the impact of the transition
to the year 2000 on the operations of NBT, Pioneer American, BSB or the combined
company. NBT and Pioneer American disclaim any obligation to update any such
factors or to publicly announce the result of any revisions to any of the
forward-looking statements included in this supplement to reflect future events
or developments. NBT's actual results could differ materially from those set
forth in the forward-looking statements because of many reasons, including the
risk factors listed above. This list may not be exhaustive.
26
<PAGE>
APPENDIX A
FAIRNESS OPINION OF MCCONNELL, BUDD & DOWNES, INC.
[LETTERHEAD OF McCONNELL, BUDD & DOWNES, INC.]
March 31, 2000
The Board of Directors
NBT Bancorp Inc.
52 South Broad Street
Norwich, New York 13815
The Board of Directors:
You have requested our opinion as to the fairness, from a financial point
of view, to the stockholders of' NBT Bancorp Inc. ("NBT") of the Exchange Ratio
governing the exchange of shares of the common stock of Pioneer American Holding
Company Corp. (Pioneer American) for shares of common stock of NBT in connection
with the proposed acquisition of Pioneer American by NBT pursuant to an
Agreement and Plan of Merger (the "Merger Agreement') dated December 7, 1999 by
and between Pioneer American and NBT. Pursuant to the Merger Agreement, Pioneer
American will merge with and into NBT, with NBT being the surviving corporation.
As is more specifically set forth in the Merger Agreement, upon
consummation of the merger, each outstanding share of Pioneer American common
stock, except for shares held by NBT and its subsidiaries or by Pioneer American
and its subsidiaries (in both cases, other than shares held in a fiduciary
capacity or as a result of debts previously contracted), will be exchanged into
1.805 shares of NBT Common Stock. The Merger Agreement may be terminated under
certain conditions prior to the effective time of the merger by the Board of
Directors of either party based on defined criteria.
McConnell, Budd & Downes, Inc., as part of its investment banking business,
is regularly engaged in the valuation of bank holding companies and banks,
thrift holding companies and thrifts and their securities in connection with
mergers and acquisitions, negotiated underwritings, private placements,
competitive bidding processes, market making as a NASD market maker, secondary
distributions of listed securities and valuations for corporate, estate and
other purposes. Our experience and familiarity with NBT includes having worked
as a financial advisor to NBT since October 20, 1994 on a contractual basis and
specifically includes our participation in the process and negotiations leading
up to the proposed merger with Pioneer American. In the course of our role as
financial advisor to NBT in connection with the merger, we have received fees
for our services and will receive additional fees contingent on the occurrence
of certain defined events. While the payment of all or a significant portion of
fees related to financial advisory services provided in connection with
arm's-length mergers and other business combination transactions upon
consummation of such transactions, as is the case with this transaction, might
be viewed as giving such financial advisors a financial interest in the
successful completion of such transactions, such compensation arrangements are
standard and customary for transactions of the size and type of this
transaction.
In arriving at our opinion, we have reviewed the Merger Agreement. We have
also reviewed publicly available business, financial and shareholder information
relating to NBT and its subsidiaries and certain publicly available financial
and shareholder information relating to Pioneer American.
In connection with the foregoing, we have (i) reviewed Pioneer American's
Annual Reports to Stockholders, Annual Reports on Form 10-K and related
financial information for the four calendar years ended December 31, 1998 and
Pioneer American's Quarterly Report on Form 10-Q and related unaudited financial
information for 1999; (ii) reviewed NBT's Annual Reports to Stockholders, Annual
Reports on Form 10-K and related financial information for the four calendar
years ended December 31, 1998 and NBT's Quarterly Report on Form 10-Q and
related unaudited financial information for 1999; (iii) reviewed certain
internal financial information
27
<PAGE>
and financial forecasts, relating to the business, earnings, cash flows, assets
and prospects of the respective companies furnished to McConnell, Budd & Downes,
Inc. by Pioneer American and NBT, respectively; (iv) held discussions with
members of the senior management and board of NBT concerning the past and
current results of operations of NBT, its current financial condition and
management's opinion of its future prospects; (v) held discussions with members
of senior management of Pioneer American concerning the past and current results
of operations of Pioneer American, its current financial condition and
management's opinion of its future prospects; (vi) reviewed the historical
record of reported prices, trading volume and dividend payments for both NBT and
Pioneer American common stock; (vii) considered the current state of and future
prospects for the economy of New York and Pennsylvania generally and the
relevant market areas for NBT and Pioneer American in particular; (viii)
reviewed specific merger analysis models employed by McConnell, Budd & Downes,
Inc. to evaluate potential business combinations of financial institutions; (ix)
reviewed the reported financial terms of selected recent business combinations
in the banking industry; and (x) performed such other studies and analyses as
McConnell, Budd & Downes, Inc. considered appropriate under the circumstances
associated with this particular transaction.
In the course of our review and analysis we considered, among other things,
such topics as the historical and projected future contributions of recurring
earnings by the parties, the anticipated future earnings per share results for
the parties on both a combined and stand-alone basis, the potential to realize
significant recurring operating expense reductions and the impact thereof on
projected future earnings per share, the relative capitalization and capital
adequacy of each of the parties, the availability of non-interest income to each
of the parties, the relative asset quality and apparent adequacy of the reserve
for loan losses for each of the parties. We also considered the composition of
deposits and the composition of the loan portfolio of each of Pioneer American
and NBT. In addition, we considered the historical trading range, trading
pattern and relative market liquidity of the common shares of each of the
parties. In the conduct of our review and analysis we have relied upon and
assumed, without independent verification, the accuracy and completeness of the
financial information provided to us by Pioneer American and NBT and or
otherwise publicly obtainable. In reaching our opinion we have not assumed any
responsibility for the independent verification of such information or any
independent valuation or appraisal of any of the assets or the liabilities of
either Pioneer American or NBT, nor have we obtained from any other source, any
current appraisals of the assets or liabilities of either Pioneer American or
NBT. We have also relied on the management of Pioneer American and NBT as to the
reasonableness of various financial and operating forecasts and of the
assumptions on which they are based, which were provided to us for use in our
analyses.
In the course of rendering this opinion, which is being rendered prior to
the receipt of certain required regulatory approvals necessary before
consummation of the merger, we assume that no conditions will be imposed by any
regulatory agency in connection with its approval of the merger that will have a
material adverse effect on the results of operations, the financial condition or
the prospects of NBT following consummation of the merger.
Based upon and subject to the foregoing, it is our opinion, that as of the
date of this letter, the exchange ratio is fair to the stockholders of NBT from
a financial point of view.
Very truly yours,
/s/ McConnell, Budd & Downes, Inc.
28
<PAGE>
APPENDIX B
FAIRNESS OPINION OF DANIELSON ASSOCIATES INC.
[LETTERHEAD OF DANIELSON ASSOCIATES]
April 20, 2000
Board of Directors
Pioneer American Holding Company Corporation
41 North Main Street
Carbondale, Pennsylvania 18407
Dear Members of the Board:
Set forth herein is the updated opinion of Danielson Associates Inc.
("Danielson Associates") as to the "fairness" of the offer by NBT Bancorp Inc.
("NBT") of Norwich, New York to acquire all of the common stock of Pioneer
American Holding Company Corporation ("Pioneer") of Carbondale, Pennsylvania.
The "fair" sale value is defined as the price at which all of the shares of
Pioneer's common stock would change hands between a willing seller and a willing
buyer, each having reasonable knowledge of the relevant facts. In opining as to
the "fairness" of the offer, it also had to be determined if the NBT common
stock that is to be exchanged for Pioneer stock is "fairly" valued.
In preparing the original opinion, Pioneer and NBT's markets and
performance were analyzed and their business and prospects were reviewed. We
also conducted such other financial analyses as we deemed appropriate such as
comparable company analyses, comparable transactions and pro forma dilution. Any
unique characteristics also were considered.
On April 20, 2000, NBT announced that it had agreed to merge with BSB
Bancorp, Inc. ("BSB") of Binghampton, New York. The agreement calls for, among
other things, that the "principal" office of the combined organization to be in
Binghampton, a new name for the surviving corporation and a board of directors
with similar representation from NBT and BSB. We have included an analysis of
BSB and the specifics of the merger agreement in our revised opinion as this
merger agreement represents a material change.
We also conducted a limited review of the due diligence analysis completed
by NBT on BSB. This included interviews of key NBT officers who were involved in
the due diligence, lending officers and senior management at BSB and consultants
hired by NBT. We also reviewed the written materials gathered and produced by
NBT's due diligence team.
This opinion is based partly on data supplied to Danielson Associates by
Pioneer and NBT, but it relied on some public information all of which was
believed to be reliable, but neither the completeness nor accuracy of such
information could be guaranteed. In particular, the opinion has assumed, based
on NBT's management's representation, that there were no significant asset
quality problems at NBT beyond what was stated in recent reports to regulatory
agencies and in the monthly report to the directors; and that the additions to
reserves being made at BSB were sufficient to cover any likely asset quality
deterioration that might be forthcoming as a result of merging BSB into NBT.
In determining the "fair" sale value of Pioneer, the primary emphasis was
on prices paid relative to earnings for Pennsylvania and Northeast banks that
had similar financial, structural and market characteristics. These prices were
then related to assets and equity capital, also referred to as "book."
29
<PAGE>
The "fair" market value of NBT's common stock to be exchanged for Pioneer
stock was determined by a comparison with other similar bank holding companies.
This comparison showed NBT stock to be valued below that of the comparable
banks.
In the original opinion, based on Pioneer's recent performance and its
future potential, comparisons with similar transactions and unique
characteristics, it was determined that its "fair" sale value was between $80
and $89 million, or $27.67 to $30.76 per share. Thus, NBT's offer of $87.5
million, or $29.22 per share, was a "fair" offer from a financial point of view
for Pioneer and its shareholders.
There has been no subsequent, significant change in NBT's performance, but
its stock price has declined by about 28%, which generally reflects the decline
in bank stock prices during this period. Thus, if the "fair" value range and
change in the offer value are adjusted to reflect market conditions as of April
20, 2000, the value of NBT's offer is still "fair" from a financial point of
view to Pioneer American and its shareholders.
Respectfully submitted,
/s/ Arnold G. Danielson
Chairman
Danielson Associates Inc.
AGD:msf
Enclosure
30
<PAGE>
PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 21. EXHIBITS AND FINANCIAL STATEMENTS.
(a)The following exhibits are filed as part of this Registration Statement or
incorporated herein by reference:
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
23.1 Consent of KPMG LLP, independent auditors for NBT Bancorp Inc.*
23.2 Consent of KPMG LLP, independent auditors for Pioneer American Holding Company Corp.*
23.3 Consent of PricewaterhouseCoopers LLP, independent accountants for BSB Bancorp, Inc.*
23.4 Consent of Danielson Associates Inc. *
23.5 Consent of McConnell, Budd & Downes, Inc. *
99.1 Opinion of McConnell, Budd & Downes, Inc. as to the fairness of the transaction to NBT (attached as Appendix A
to the Supplement included in this Registration Statement).
99.2 Opinion of Danielson Associates Inc. as to the fairness of the transaction to stockholders of Pioneer American
(attached as Appendix B to the Supplement included in this Registration Statement).
</TABLE>
- ---------------
* Filed herewith.
(b) No financial statement schedules are required to be filed herewith
pursuant to Item 21(b) of this Form.
(c) The fairness opinion of McConnell, Budd & Downes, Inc. is attached as
Appendix A to the Supplement included in this Registration Statement.
The fairness opinion of Danielson Associates Inc. is attached as
Appendix B to the Supplement included in this Registration Statement.
ITEM 22. UNDERTAKINGS.
The undersigned registrant hereby undertakes as follows:
(1) that, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(2) to deliver or cause to be delivered with the prospectus, to each person
to whom the prospectus is sent or given, the latest annual report to security
holders that is incorporated by reference in the prospectus and furnished
pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the
Securities Exchange Act of 1934; and, where interim financial information
required to be presented by Article 3 of Regulation S-X is not set forth in the
prospectus, to deliver, or cause to be delivered to each person to whom the
prospectus is sent or given, the latest quarterly report that is specifically
incorporated by reference in the prospectus to provide such interim financial
information.
(3) that prior to any public reoffering of the securities registered
hereunder through the use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within the
<PAGE>
meaning of Rule 145(c), such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.
(4) that every prospectus (i) that is filed pursuant to paragraph (3)
immediately preceding, or (ii) that purports to meet the requirements of Section
10(a)(3) of the Securities Act of 1933, as amended, and is used in connection
with an offering of securities subject to Rule 415, will be filed as a part of
an amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(5) that insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions described under Item 20
above, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(6) to respond to requests for information that is incorporated by
reference into the Joint Proxy Statement/Prospectus pursuant to Items 4, 10(b),
11 or 13 of Form S-4, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to the
Effective Date of the registration statement through the date of responding to
the request.
(7) to supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective.
(8) to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement.
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
(9) to remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Norwich, New York on this 9th day of
May, 2000.
NBT Bancorp Inc.
/s/ Michael J. Chewens
----------------------
By: Michael J. Chewens
Executive Vice President, Chief
Financial Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- --------- -------- ----
<S> <C> <C>
/s/ Daryl R. Forsythe* President, Chief Executive Officer May 9, 2000
- --------------------- and Director (Principal Executive
Daryl R. Forsythe Officer)
/s/ Michael J. Chewens Executive Vice President, May 9, 2000
- ---------------------- Chief Financial Officer, and Treasurer
Michael J. Chewens of NBT and NBT Bank (Principal
Financial and Accounting Officer)
/s/ Everett A. Gilmour* Chairman of the Board of Directors May 9, 2000
- ----------------------
Everett A. Gilmour
/s/ J. Peter Chaplin* Director May 9, 2000
- --------------------
J. Peter Chaplin
/s/ Peter B. Gregory* Director May 9, 2000
- --------------------
Peter B. Gregory
Director , 2000
- ----------------------
William C. Gumble
Director , 2000
- ----------------------
Bruce D. Howe
Director , 2000
- --------------------------
Andrew S. Kowalczyk, Jr.
/s/ Dan B. Marshman* Director May 9, 2000
- -------------------
Dan B. Marshman
Director , 2000
- --------------------------
John G. Martines
/s/ John C. Mitchell* Director May 9, 2000
- --------------------
John C. Mitchell
Director , 2000
- -------------------------
William L. Owens
/s/ Paul O. Stillman* Director May 9, 2000
- --------------------
Paul O. Stillman
</TABLE>
* By: /s/ Michael J. Chewens
------------------------------
Michael J. Chewens, Attorney-in-Fact
Pursuant to Power of Attorney
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
23.1 Consent of KPMG LLP, independent auditors for NBT Bancorp Inc.*
23.2 Consent of KPMG LLP, independent auditors for Pioneer American Holding Company Corp.*
23.3 Consent of PricewaterhouseCoopers LLP, independent accountants for BSB Bancorp, Inc.*
23.4 Consent of Danielson Associates Inc. *
23.5 Consent of McConnell, Budd & Downes, Inc. *
99.1 Opinion of McConnell, Budd & Downes, Inc. as to the fairness of the transaction to NBT (attached as Appendix A
to the Supplement included in this Registration Statement).
99.2 Opinion of Danielson Associates Inc. as to the fairness of the transaction to stockholders of Pioneer American
(attached as Appendix B to the Supplement included in this Registration Statement).
</TABLE>
- ---------------------
* Filed herewith.
NBT BANCORP INC.
Proxy Solicited on Behalf of the Board of Directors
The undersigned hereby appoints James I. Dunne and Adelbert L. Button, and
either of them, with full power of substitution, proxies to represent the
undersigned at the adjourned Annual Meeting of Stockholders of NBT Bancorp Inc.
("NBT") to be reconvened at the Holiday Inn Arena, 2-8 Hawley Street,
Binghamton, New York on June 20, 2000 at 2:00 p.m. local time, or at any
adjournment or postponement thereof (the "Meeting"), with all power which the
undersigned would possess if personally present, and to vote all shares of NBT's
common stock which the undersigned may be entitled to vote at said Meeting upon
the following proposals described in the accompanying supplement, in accordance
with the following instructions and, at their discretion, upon any other matters
that may properly come before the Meeting. THIS PROXY, WHEN PROPERLY EXECUTED,
WILL BE VOTED AS DIRECTED BY THE UNDERSIGNED. IF NO DIRECTION IS INDICATED, THIS
PROXY WILL BE VOTED FOR THE ISSUANCE OF NBT COMMON STOCK IN THE MERGER AND
RATIFICATION OF THE MERGER AGREEMENT.
1. To approve the issuance by NBT of its common stock to the former
stockholders of Pioneer American Holding Company Corp. in the merger and
ratify the Agreement and Plan of Merger, dated as of December 7, 1999, and
amended as of March 7, 2000, by and between NBT and Pioneer American,
which, if completed, would result in (a) the merger of Pioneer American
with a subsidiary of NBT, (b) the subsequent merger of Pioneer American
into NBT, and (c) the issuance of 1.805 shares of NBT common stock in
exchange for each share of Pioneer American common stock, and all of the
matters contemplated by the merger agreement.
[_] FOR [_] AGAINST [_] ABSTAIN
2. The proxies are authorized to vote in their discretion upon such other
business that may properly come before the Meeting.
X Please mark your votes as in this example.
(Continued and to be signed on reverse side) SEE REVERSE SIDE
(Continued from other side)
[_] Check here for address change and note change below
[_] Check here if you plan to attend the Meeting
New
address:
Date: Signature(s)
------------------------
Please sign here exactly as name(s) appear(s) on the left.
When signing as attorney, executor, administrator, trustee,
guardian, or in any other fiduciary capacity, give full
title. If more than one person acts as trustee, all should
sign. All joint owners must sign.
PIONEER AMERICAN HOLDING COMPANY CORP.
<PAGE>
Proxy Solicited on Behalf of Board of Directors
The undersigned hereby appoints Daniel Corazzi, John Kuna and Basil Telep,
or any one or more of them, with full power of substitution, proxies, to vote
all of the stock of Pioneer American Holding Company Corp., which the
undersigned is entitled to vote at the adjourned Special Meeting of Stockholders
of Pioneer American to be reconvened at Heart Lake Lodge, 1299 Heart Lake Road,
Jermyn, Pennsylvania on June 20, 2000 at 10:00 a.m. local time and at any
adjournment or postponement thereof. THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE
VOTED, AS DIRECTED BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, IT WILL BE VOTED
FOR THE FOLLOWING PROPOSAL.
1. To approve the Agreement and Plan of Merger, dated as of December 7, 1999,
and amended as of March 7, 2000, by and between Pioneer American and NBT
Bancorp Inc. ("NBT"), which would result in the merger of Pioneer American
into NBT and the issuance of 1.805 shares of NBT common stock in exchange
for each share of Pioneer American common stock, and all of the matters
contemplated by the merger agreement.
[_] FOR [_] AGAINST [_] ABSTAIN
2. The proxies are authorized to vote in their discretion upon such other
business that may properly come before the Pioneer American adjourned
special meeting.
X Please mark your votes as in this example.
(Continued and to be signed on reverse side) SEE REVERSE SIDE
(Continued from other side)
Date: Signature(s)
--------------------------
--------------------------
--------------------------
--------------------------
Please sign here exactly as name(s) appear(s) on the left.
When signing as attorney, executor, administrator, trustee,
guardian, or in any other fiduciary capacity, give full
title. If more than one person acts as trustee, all should
sign. All joint owners must sign.
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
NBT Bancorp Inc.:
We consent to incorporation by reference in Post-Effective Amendment No. 1
to the registration statement on Form S-4 of NBT Bancorp Inc. related to the
registration of shares for the merger between NBT Bancorp Inc. and Pioneer
American Holding Company Corp., filed by NBT Bancorp Inc. under the Securities
Act of 1933 of our audit report dated January 21, 2000, with respect to the
consolidated balance sheets of NBT Bancorp Inc. and subsidiary as of December
31, 1999 and 1998, and the related consolidated statements of income,
stockholders' equity, cash flows and comprehensive income for each of the years
in the three-year period ended December 31, 1999 which report appears in the
December 31, 1999 annual report on Form 10-K of NBT Bancorp Inc., incorporated
by reference herein, and to the reference to our firm under the heading
"Experts" in the Supplemental Joint Proxy Statement/Prospectus and the
registration statement referred to above.
We consent to incorporation by reference in Post-Effective Amendment No. 1
to the registration statement on Form S-4 of NBT Bancorp Inc. related to the
registration of shares for the merger between NBT Bancorp Inc. and Pioneer
American Holding Company Corp., filed by NBT Bancorp Inc. under the Securities
Act of 1933 of our audit report dated March 10, 2000, with respect to the
supplemental consolidated balance sheets of NBT Bancorp Inc. and subsidiaries as
of December 31, 1999 and 1998, and the related supplemental consolidated
statements of income, stockholders' equity, cash flows and comprehensive income
for each of the years in the three-year period ended December 31, 1999 which
report appears in the Current Report on Form 8-K dated March 31, 2000, filed by
NBT Bancorp Inc., incorporated by reference herein.
/s/ KPMG LLP
KPMG LLP
Syracuse, New York
May 10, 2000
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Pioneer American Holding Company Corp.
We consent to incorporation by reference in Post-Effective Amendment No.
1 to the registration statement on Form S-4 of NBT Bancorp Inc. of our audit
report dated January 21, 2000, relating to the consolidated balance sheets of
Pioneer American Holding Company Corp. and subsidiary as of December 31, 1999
and 1998, and the related consolidated statements of operations, changes in
stockholders' equity, and cash flows for each of the years in the three-year
period ended December 31, 1999 which report has been incorporated by reference
in the December 31, 1999 annual report on Form 10-K of Pioneer American Holding
Company Corp., incorporated by reference herein, and to the reference to our
firm under the heading "Experts" in the Supplement.
/s/ KPMG LLP
- ------------
KPMG LLP
Philadelphia, Pennsylvania
May 5, 2000
EXHIBIT 23.3
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Post-Effective
Amendment No. 1 to the registration statement on Form S-4 of NBT Bancorp Inc. of
our report dated January 21, 2000, relating to the financial statements of BSB
Bancorp, Inc., which appears in the 1999 Annual Report to Shareholders which is
incorporated by reference in its Annual Report on Form 10-K for the year ended
December 31, 1999. We also consent to the references to us under the heading
"Experts" in such Post-Effective Amendment No. 1.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Syracuse, New York
May 9, 2000
EXHIBIT 23.4
CONSENT OF FINANCIAL ADVISOR
CONSENT OF DANIELSON ASSOCIATES INC.
We hereby consent to the use of our firm's name in the Form S-4
Registration Statement of NBT Bancorp Inc. relating to the registration of
shares of NBT Bancorp Inc. common stock to be issued in connection with the
proposed acquisition of Pioneer American Holding Company Corp. We also consent
to the inclusion of our opinion letter as an Appendix to the Joint Proxy
Statement/Prospectus included as part of the Form S-4 Registration Statement,
and to the references to our opinion included in the Joint Proxy
Statement/Prospectus.
DANIELSON ASSOCIATES INC.
By: /s/ Arnold G. Danielson
Arnold G. Danielson
Chairman
May 9, 2000
EXHIBIT 23.5
CONSENT OF FINANCIAL ADVISOR
We hereby consent to the inclusion of the Opinion of McConnell, Budd &
Downes, Inc. in the Post-Effective Amendment No. 1 to Form S-4 of NBT Bancorp
Inc. ("NBT") and Joint Proxy Statement to be filed with the Securities and
Exchange Commission in connection with the proposed Consolidation of NBT and
Pioneer American Holding Company Corp. and to the references to the work
completed by our firm as financial advisor to NBT, therein. In giving such
consent, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act of 1933 or the
rules and regulations of the Securities and Exchange Commission thereunder, nor
do we thereby admit that we are experts with respect to any part of such
Registration Statement within the meaning of the term "expert" as used in the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.
/s/ McConnell, Budd & Downes, Inc.
May 8, 2000
