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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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)
December 31, 1996
FIRSTFEDERAL FINANCIAL SERVICES CORP
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(Exact name of Registrant as specified in its Charter)
Ohio 0-17894 34-1622711
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(State or other (Commission File No.) (IRS Employer
jurisdiction of Identification
incorporation) Number)
135 East Liberty Street, Wooster, Ohio 44691
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(330) 264-8001
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N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events
On December 31, 1996, FirstFederal Financial Services Corp
("FirstFederal") and Summit Bancorp ("Summit") issued the joint
press release included as Exhibit 99 to this report and
incorporated by reference herein, announcing the signing of the
Agreement of Affiliation and Plan of Merger, by and between
FirstFederal and Summit Bancorp ("Summit"), dated December 30,
1996 (the "Agreement"), pursuant to which Summit will merge with
and into FirstFederal, with FirstFederal as the surviving
corporation (the "Merger"). Consummation of the Merger, which is
expected to close in July 1997, is subject to the satisfaction of
certain conditions, including approval of the Merger by Summit's
shareholders and regulatory authorities.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99 Text of joint press release, dated December 31,
1996, issued by FirstFederal Services Corp and
Summit Bancorp.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned thereunto duly authorized.
FIRSTFEDERAL FINANCIAL SERVICES CORP
Date: January 8, 1997 By: /s/ Gary G. Clark
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Gary G. Clark
Chairman and Chief Executive
Officer
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EXHIBIT INDEX
Exhibit Number Description
99 Joint Press Release of FirstFederal
Financial Services Corp and Summit
Bancorp, dated December 31, 1996
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Exhibit 99
[FIRST FEDERAL FINANCIAL SERVICES CORP LETTERHEAD]
NEWS RELEASE
FOR IMMEDIATE RELEASE
December 31, 1996
Gary G. Clark, Chairman David C. Vernon, Chairman
FirstFederal Financial Services Corp Summit Bancorp
135 East Liberty Street 2680 West Market Street
Wooster, OH 44691 Akron, OH 44333
Phone: (330) 264-8001 Phone (330) 864-8080
FirstFederal Financial Services Corp
and Summit Bancorp Sign Definitive Agreement
Wooster and Akron, Ohio -- FirstFederal Financial Services
Corp (NASDAQ-FFSW, FFSWP, FFSWO) and Summit Bancorp ("Summit")
jointly announced today the signing of a definitive agreement for
the acquisition of the stock of Summit Bancorp by First Federal.
Under the terms of the agreement, FirstFederal will exchange
1.87 shares of its common stock for each of the 234,916 shares of
Summit stock. Based on the average of FirstFederal's closing bid
and ask price of $39.375 on December 30, 1996, the transaction
would be valued at approximately $17.3 million. The merger,
which will be accounted for as a pooling of interests, is
expected to be consummated during the third quarter of 1997,
pending Summit shareholder approval, regulatory approval and
other customary conditions of closing. The transaction is
expected to be a tax-free reorganization for federal income tax
purposes.
Summit Bancorp's subsidiary, Summit Bank, has two commercial
banking offices. Its main office is located at 2680 West Market
Street in Akron and a second office is located at 126 West
Streetsboro Street in Hudson. At September 30, 1996, Summit had
total assets of $79.2 million, deposits of $64.5 million and
shareholders' equity of $6.9 million. Summit reported net income
of $0.6 million for the first nine months of 1996 with an
annualized return on assets of 1.03% and an annualized return on
shareholders' equity of 11.72%.
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Gary G. Clark, chairman and chief executive officer of
FirstFederal stated, "Summit is a great performing community bank
with a strong reputation for providing exceptional customer
service. It is a natural market extension to our existing
franchise which includes the contiguous markets of Wayne, Medina
and Stark Counties. It will also expand our ability to serve the
small business lending market and further diversify our balance
sheet which has been heavily concentrated in residential mortgage
loans. The fact that Summit Bank was just started in 1991 and
has grown and prospered to its current position is a real tribute
to the dedication of the employees, management and Board. It is
FirstFederal's intent to operate Summit Bank as a wholly owned
subsidiary with its name, management and Board intact. In
addition, we are pleased to appoint Mr. David C. Vernon to the
Board of Directors of FirstFederal."
David C. Vernon, chairman and chief executive officer of
Summit stated, "This is exciting news for Summit Bancorp
shareholders and for Summit Bank clients. With this merger, we
have formed a new partnership with an outstanding financial
services organization which solidly positions us to serve our
community in the future."
FirstFederal Financial Services Corp is the holding company
for two financial service companies: Mobile Consultants, Inc., a
broker and servicer of manufactured housing finance contracts,
which does business in 23 states, and First Federal Savings and
Loan Association of Wooster, which specializes in residential
mortgage loans and consumer loans. It also offers a full-range
of retail financial services through its twenty offices in the
north central Ohio countries of Wayne, Ashland, Medina, Richland
and Knox. In addition to banking services, First Federal Savings
and Loan Association owns and operates an insurance agency,
H.F.S. Agency Inc., and an investment subsidiary, Home Financial
Services, which offers a full line of investment products. First
Federal also owns a mortgage loan production subsidiary, First
Federal Mortgage Services Corp, with offices in Canton, Stow, and
New Philadelphia, Ohio and Professional Appraisal Services Corp,
a real estate appraising and consulting firm.
McDonald and Company Securities, Inc. is serving as Summit's
financial advisor in connection with the transaction.
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FirstFederal Financial's Acquisition of Summit Bancorp
Summary Fact Sheet
Announcement Date: December 31, 1996
Deal Structure: Pooling of interests
Tax-free exchange
Definitive agreement signed
$750,000 Break-up fee
Due diligence completed
Terms: 1.87 shares of FirstFederal Financial common
for each share of Summit. Fixed exchange
ratio.
Timing: Subject to normal regulatory and Summit's
shareholder approval.
Closing expected by July 31, 1997.
Pricing*: Purchase price per share $73.63
Price to book value (9/30/96) 250%
Price to trailing
earnings (9/30/96 annualized) 21.5 X
FirstFederal shares issued (,000) 439
Estimated transaction value $17.3
million
Transaction Rationale:
+ Logical contiguous expansion into growth market.
+ Acquisition of small business commercial lending and
private
banking expertise, essential in FirstFederal's
diversification
effort.
+ FirstFederal's equity generation will permit continued
expansion
of Summit's market.
+ Due to diversity of operations, minimal cost savings
projected
(5%).
+ Transaction is expected to be modestly accretive to
earnings per
share in the first full year.
* Based upon the average of the closing bid & ask price for
FirstFederal stock on December 30, 1996 of $39.375.
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FirstFederal Financial's Acquisition of Summit Bancorp
Pro Forma Combined Fact Sheet
September 30, 1996
($ in thousand except per share)
<TABLE>
<CAPTION>
FirstFederal Summit Pro Forma
<S> <C> <C> <C>
Total assets 1,111 79 1,190
Gross loans 808 55 863
Deposits 638 65 703
Borrowings 373 7 380
Equity 82 7 89
Equity/assets 7.42% 8.74% 7.51%
Fully diluted shares
outstanding (,000) 5,561 235 6,000
Tangible book value per
fully diluted share $14.81 29.48 14.88
Market capitalization
($ millions)* 218.9 6.90 236.26
Number of Offices 20 2 22
* Based upon the average of FirstFederal closing bid and ask
price
December 30, 1996 of $39.375 and book value for Summit.
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