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Filed by: First Bancorp
Pursuant to Rule 425 under the Securities Act of
1933
Subject Company: First Bancorp
Registration File No. 333-34216
Letter first mailed to shareholders of First Savings Bancorp, Inc.
on May 19,2000
May 19, 2000
{{NAME}}
{{NAME2}}
{{ADDRESS}}
{{CITY}}, {{STATE}} {{POSTAL}}
{{COUNTRY}}
Dear Shareholder,
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The Board of Directors of First Savings Bancorp
urges you to support the merger with First Bancorp.
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You have been mailed a proxy statement/prospectus regarding our proposed merger
with First Bancorp. Please read the proxy statement/prospectus carefully before
you vote. It contains important information about the merger.
The merger with First Bancorp is a good deal for shareholders. It represents an
excellent opportunity to continue our financial leadership in Moore County.
Since 1922, we've prospered because we put our customers first. Since our
conversion to a public company in 1994, we've built a widely acknowledged track
record of rewarding our shareholders.
Now, after a thorough and complete investigation, we find the best way to
continue our tradition of building value for shareholders and customers is to
combine resources with First Bancorp.
The proxy statement/prospectus includes pro forma financial information about
the merger. Based on this information and other information in the proxy
statement/prospectus, we believe that with First Bancorp, shareholders will
have a greater potential to experience: (a) increased earnings per share, (b)
enhanced dividends per share and (c) enhanced return on equity.
Additional benefits to First Savings shareholders include:
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1. First Savings shareholders are expected to receive an INCREASED DIVIDEND
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equivalent to an annual dividend rate of $1.10 per share.
2. First Savings shareholders will receive 1.2468 shares of First Bancorp
stock for each of their First Savings shares. For example, for each
1,000 First Savings shares you own, as part of the merger you will
receive 1,246 shares of the new banking company.
(Please turn to the reverse side)
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(Shareholder letter, continued)
Reasons we recommend the merger, continued
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3. To insure that the changes after the merger reflect the needs and wishes
of First Savings customers, the new board will include seven current
First Savings directors.
4. The new company will continue to have the entire First Savings employee
and management team in place, so customers will see very few changes in
the way we do business.
5. First Savings shareholders will own 49% of a banking company whose total
shareholder equity should exceed $100 million.
6. First Savings shareholders will become part of a banking company with
assets that are expected to exceed $900 million. The company expects to
operate 11 full-service offices in Moore County, 28 offices in other NC
counties, for a total of 39 banking offices in the state.
7. The new bank is expected to have the largest market share in Moore
County.
8. There will be more shareholders; thus stock liquidity should be
increased.
9. The merger will make First Savings shareholders part of a banking
company that has the modern products and services Moore County banking
customers want - and need. (Services they are buying every day from
other banks in the county.)
We feel the best, most prudent, safest way for us to grow into a modern banking
institution is to merge with First Bancorp. We urge you to join with our Board
of Directors and vote "FOR" the merger.
The Board of Directors,
First Savings Bancorp
REMEMBER, EVERY VOTE IS IMPORTANT.
IT IS VERY IMPORTANT YOU CAST YOUR VOTE.
QUESTIONS? Call 910-692-6222
The above information has been provided by the Board of Directors of First
Savings Bancorp, Inc. First Bancorp and First Savings Bancorp have filed a
joint proxy statement/prospectus and other documents concerning the merger with
the United States Securities and Exchange Commission ("SEC") and have mailed the
joint proxy statement/prospectus to their shareholders. These documents contain
important information and we urge you to read the joint proxy statement/
prospectus and other documents filed with the SEC carefully. You can obtain the
documents free from the SEC's website, www.sec.gov. Our officers' and
directors' interests in First Savings (stock, contracts, etc.) are described in
First Savings' September 24, 1999 proxy statement which is also available on the
SEC website. In addition, you may obtain free copies of these documents from
the Corporate Secretary of First Savings Bancorp, P.O. Box 1657, Southern Pines,
North Carolina 28388-1657, telephone (910) 692-6222.
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Statement first mailed to shareholders of First Savings Bancorp, Inc.
on May 19, 2000
First Savings Bancorp - First Bancorp Merger
THE FACTS ARE OUT!
You have been mailed a proxy statement/prospectus
for our proposed merger with First Bancorp.
This proxy statement should answer many of your questions and dispel the
misinformation that has been distributed about this merger.
Your Board of Directors firmly believes
this merger is in the best interest of First Savings' shareholders.
The proxy statement contains a lot of information. We urge you to read all of
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it.
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We especially call your attention to the following information.
1. Page 86 - Shareholder Return Performance for First Bancorp - First Bancorp
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has been a high performer. The chart on this page illustrates that if you
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had invested $100 in First Bancorp common stock on December 31, 1994 and
reinvested all dividends, it would have been worth $266.47 at December 31,
1999, or an annualized return of 21.7%. This compares to First Savings'
annualized five-year return as of June 30, 1999 of 6.7%.
2. Pages 22-26 - Background of the Merger - This section describes the process
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and logic we went through in making the decisions we made. It notes that
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discussions were held with 11 companies regarding a combination with First
Savings. It also notes that at the time the decision was made to join with
First Bancorp, there was no better offer.
3. Pages 28-30 - Opinion of First Savings' Financial Advisor - This section
describes the thorough process and analysis that Ferguson & Company, an
independent investment banking firm, went through that resulted in them
concluding that the amount to be received in this merger is fair from a
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financial point of view to the shareholders of First Savings. The analyses
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obtained/prepared by a dissident shareholder are far less thorough than that
contained in the proxy statement.
(please turn to the reverse side)
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FACT SHEET, continued
4. Page 12 - Historical and Pro Forma Comparative Per Share Data - The chart on
this page, which does not consider any cost savings or revenue enhancements
that may result from the merger, shows that if you combined the two bank's
earnings in 1999 and applied the merger exchange ratio that First Savings
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shareholders earnings per share go up 14.5% (from $1.38 to $1.58) while for
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First Bancorp shareholders, their earnings per share go down (from $1.43 to
$1.27). We believe earnings per share is a far greater component of
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shareholder value than book value.
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5. Pages 31-35 - Opinion of First Bancorp's Financial Advisor - Of particular
note is the section entitled "Financial Impact Analysis." A dissident has
been quoted as saying that First Bancorp can afford to pay a much higher
exchange ratio. The second paragraph of this section notes that even after
accounting for estimated cost savings and revenue enhancements, the merger
is actually estimated to be 3.3% dilutive to First Bancorp's earnings per
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share.
These are just a few of the many things you need to consider as you read the
proxy statement. We are confident that after you read the facts, you will agree
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this merger is in the best interest of First Savings shareholders.
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Your Board of Directors
Recommends You Vote "For" the Merger
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REMEMBER, EVERY VOTE IS IMPORTANT.
IT IS VITAL YOU CAST YOUR VOTE.
QUESTIONS? Call 910-692-6222
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The above information has been provided by the Board of Directors of First
Savings Bancorp, Inc. First Bancorp and First Savings Bancorp have filed a
joint proxy statement/prospectus and other documents concerning the merger with
the United States Securities and Exchange Commission ("SEC") and have mailed the
joint proxy statement/prospectus to their shareholders. These documents contain
important information and we urge you to read the joint proxy
statement/prospectus and other documents filed with the SEC carefully. You can
obtain the documents free from the SEC's website, www.sec.gov. Our officers' and
directors' interests in First Savings (stock, contracts, etc.) are described in
First Savings' September 24, 1999 proxy statement which is also available on the
SEC website. In addition, you may obtain free copies of these documents from
the Corporate Secretary of First Savings Bancorp, P.O. Box 1657, Southern Pines,
North Carolina 28388-1657, telephone (910) 692-6222.
