SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 14, 1997
(December 30, 1996)
FIRST ESSEX BANCORP, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-16143 04-2943217
(State or Other (Commission File (IRS Employer
Jurisdiction of Number) Identification Number)
Incorporation)
71 Main Street
Andover, MA 01810
(Address of Principal Executive Offices)
(508) 475-4313
(Registrant's Telephone Number, including Area Code)
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 30, 1996, First Essex Bancorp, Inc. ("Bancorp") completed
its merger (the "Merger") with Finest Financial Corp. ("Finest"), pursuant to an
Agreement and Plan of Reorganization (the "Acquisition Agreement"), dated as of
August 5, 1996, as amended, by and among Bancorp, Finest and Pelham Bank and
Trust Company, a New Hampshire trust company and the wholly owned subsidiary of
Finest ("Pelham"). In accordance with the terms of the Merger, Finest merged
with and into Bancorp. In conjunction with the consummation of the Merger and
pursuant to an Agreement and Plan of Merger, dated as of August 5, 1996, as
amended, between Pelham and First Essex Bank, FSB, a federal stock savings bank
and the wholly owned subsidiary of Bancorp (the "Bank"), Pelham was merged with
and into the Bank (the "Bank Merger"). As a result of the Bank Merger, Pelham's
three New Hampshire branches will be operated as branch offices of the Bank.
Upon the effectiveness of the Merger, and in accordance with the terms
of the Acquisition Agreement, each share of Finest common stock, $.10 par value
per share ("Finest Stock"), outstanding immediately prior to the Merger was
converted into the right to receive either 1.761 shares of common stock of
Bancorp, $.10 par value per share ("Bancorp Stock"), or cash in the amount of
$20.25. The exchange provisions of the Acquisition Agreement require that 52% of
the total consideration paid by Bancorp in the Merger must be in the form of
Bancorp Stock and the remaining 48% must be in cash. In accordance with such
exchange provisions, the former Finest stockholders are entitled to receive an
aggregate of 1,354,021 shares of Bancorp Stock, valued in the aggregate at
$15,571,237.50, based on the average of the closing bid prices of the shares of
Bancorp Stock as reported on the Nasdaq National Market for the twenty
consecutive trading days beginning on November 22, 1996 and ending on December
20, 1996 or $13.60 per share of Bancorp Stock, and an aggregate cash amount of
$14,373,450.00. If the elections made by former Finest stockholders
oversubscribe either the cash or Bancorp Stock available as Merger
consideration, those elections will be reduced in accordance with the procedures
set forth in the Acquisition Agreement. No fractional shares of Bancorp Stock
will be issued and Bancorp will pay cash in lieu thereof. Bancorp relied on
internal capital resources to fund the cash portion of the consideration paid in
the Merger.
Each of the Merger and the Bank Merger constitutes a tax-free
reorganization and no gain or loss will be recognized by Bancorp, the Bank,
Finest or Pelham as a result of either the Merger or the Bank Merger. The Merger
will be accounted for as a "purchase" transaction.
Certain additional information regarding the Merger is contained in
Bancorp's press release dated January 3, 1997, a copy of which is included as an
exhibit hereto and incorporated herein.
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Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired.
Financial statements required by this item will be filed by amendment
not later than 60 days after the date hereof pursuant to (a) (4) of Item 7.
(b) Pro Forma Financial Information.
Pro forma financial information required by this item will be filed by
amendment not later than 60 days after the date hereof pursuant to (b) (2) of
Item 7.
(c) Exhibits.
2.1 Agreement and Plan of Reorganization, dated as of August 5, 1996,
as amended as of September 27, 1996, by and among Bancorp, Finest and Pelham
(incorporated by reference to Exhibit 2.1 to Bancorp's Form S-4, Reg. No.
333-12793 ("Form S-4")).
2.2 Agreement and Plan of Merger, dated as of August 5, 1996, as
amended as of September 27, 1996, by and between Pelham and the Bank
(incorporated by reference to Exhibit 2.3 to Bancorp's Form S-4).
99 Press Release of Bancorp, dated January 3, 1997.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Bancorp has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIRST ESSEX BANCORP, INC.
Date: January 14, 1997 By: /s/ David W. Dailey
------------------------
David W. Dailey
Executive Vice President and Chief
Financial Officer
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<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit No. Description Page
<S> <C> <C>
2.1 Agreement and Plan of Reorganization, Incorporated by reference to
dated as of August 5, 1996, as amended as Exhibit 2.1 to Bancorp's Form S-
of September 27, 1996, by and among 4 (Reg. No. 333-12793)
Bancorp, Finest and Pelham
2.2 Agreement and Plan of Merger, dated as Incorporated by reference to
of August 5, 1996, as amended as of Exhibits 2.2 and 2.3 to Bancorp's
September 27, 1996, by and between Form S-4 (reg. No. 333-12793)
Pelham and the Bank
99 Press release, dated January 3, 1997 Page 6
</TABLE>
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Exhibit 99
First Essex Bancorp, Inc.
Acquires Finest Financial Corp.
Andover, MA, January 3, 1997 - First Essex Bancorp, Inc., (NASDAQ:FESX)
announced that on December 30th it consummated its acquisition of Finest
Financial Corp. Concurrently, Pelham Bank And Trust Company, a sole subsidiary
of Finest, was merged into First Essex Bank, FSB.
With the acquisition concluded, First Essex Bancorp Inc. becomes a $1.1 billion
banking company with 15 full service banking offices in both Northeastern
Massachusetts and New Hampshire.
The merger results in substantial market share gains in New Hampshire. In
Rockingham County, the largest and most populated county in southern New
Hampshire, First Essex increases its market share rank to approximately 6 from
number 11.
In announcing the conclusion of the acquisition, Leonard A. Wilson, First
Essex's President and Chief Executive Officer stated, "We are very excited about
beginning a New Year as a larger and even stronger company. As First Essex Bank
approaches its 150th year of providing financial services to the communities of
the Merrimack Valley and southern New Hampshire, we couldn't be more
enthusiastic about our future."
It is anticipated that by the end of the current fiscal quarter, (March 31,
1997) First Essex customers will be able to conduct all banking transactions in
any of its 15 offices in both Massachusetts and New Hampshire.
First Essex Bank, FSB is a wholly-owned subsidiary of First Essex Bancorp, Inc.
Originally established in 1847, the Bank provides community-based financial
services for consumer and commercial customers. First Essex has 15 full-service
banking centers located throughout northeastern Massachusetts, and southern New
Hampshire. The Bank also maintains loan centers in Wellesley, Massachusetts and
Londonderry, Nashua, and North Hampton, New Hampshire.
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