-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F3LRxWDbBBX40Aik79YWyYGRNHEiIvF7AqW5PArMbUWXcCIqasPTRaNsdSmU1/BT 1LLnsSg7i1UfTVTmaL2ggA== 0001047469-98-019974.txt : 19980515 0001047469-98-019974.hdr.sgml : 19980515 ACCESSION NUMBER: 0001047469-98-019974 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980401 ITEM INFORMATION: FILED AS OF DATE: 19980514 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST EMPIRE STATE CORP CENTRAL INDEX KEY: 0000036270 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 160968385 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 001-09861 FILM NUMBER: 98619351 BUSINESS ADDRESS: STREET 1: C/O CORPORATE REPORTING STREET 2: ONE M&T PLAZA 5TH FLOOR CITY: BUFFALO STATE: NY ZIP: 14240 BUSINESS PHONE: 7168425445 MAIL ADDRESS: STREET 1: C/O CORPORAE REPORTING STREET 2: ONE M&T PLAZA 5TH FLR CITY: BUFFALO STATE: NY ZIP: 14240 8-K/A 1 8-K/A SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 8-K/A (Amendment No. 1) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): April 1, 1998 ------------------------------ FIRST EMPIRE STATE CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) New York - -------------------------------------------------------------------------------- (State or other jurisdiction of incorporation) 1-9861 16-0968385 - ------------------------ ------------------------------------ (Commission File Number) (I.R.S. Employer Identification No.) One M&T Plaza, Buffalo, New York 14240 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (716) 842-5445 ------------------------- (NOT APPLICABLE) - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) First Empire State Corporation ("First Empire") hereby amends the following item of its Current Report on Form 8-K dated April 1, 1998, filed on April 10, 1998, as set forth below. The purpose of that Report was to disclose, pursuant to Item 2, First Empire's acquisition of ONBANCorp, Inc. As permitted by Sections (a)(4) and (b)(2) of the Instructions to Item 7, the Report omitted the PRO FORMA financial information required by Item 7(b). The purpose of this amendment is to file such PRO FORMA information. Item 7. Financial Statements and Exhibits. (a) The audited consolidated financial statements of ONBANCorp and its subsidiaries as of December 31, 1997 and 1996 and for each of the years ended December 31, 1997, 1996 and 1995, included in ONBANCorp's Annual Report on Form 10-K for the year ended December 31, 1997, are hereby incorporated by reference, together with the report of KPMG Peat Marwick LLP, independent auditors, on such financial statements.* (b) An unaudited PRO FORMA Condensed Combined Balance Sheet of First Empire as of December 31, 1997 and an unaudited PRO FORMA Condensed Combined Statement of Income of First Empire for the year ended December 31, 1997 are filed herewith as Exhibit 99.3. The unaudited PRO FORMA Condensed Combined Balance Sheet assumes that the Merger was consummated on December 31, 1997. Certain amounts in ONBANCorp's historical balance sheet as shown have been reclassified to conform to First Empire's presentation. The unaudited PRO FORMA Condensed Combined Statement of Income assumes that the Merger was consummated on January 1, 1997 and reflects the consolidation of the results of operations of First Empire and ONBANCorp for the year ended December 31, 1997. The cash portion of the consideration for the Merger is assumed to have been funded by the liquidation of investment securities. As a result of the Merger, First Empire expects to achieve substantial benefits, primarily in the area of operating cost savings. Assuming that all cost savings measures are implemented (which are expected to require a 12-month phase-in period), First Empire estimates annual net operating cost savings of approximately $31 million. First Empire's management estimates that savings achieved during the first 12 months following the Merger would represent approximately two-thirds of the fully phased-in savings. Management also estimates that operating cost savings that may be realized during the first 12 months following the Merger will be largely offset by various one-time expenses associated with systems conversions and other costs of integrating and conforming the acquired operations with First Empire. The unaudited PRO FORMA earnings, do not reflect any direct costs or potential savings which are expected to result from the Merger and are not indicative of the results of future operations. No assurances can be given with respect to the ultimate level of cost savings to be realized or one-time expenses to be incurred. The unaudited PRO FORMA condensed financial information is not necessarily indicative of the future financial position or future results of operations of First Empire or of the financial position or the results of operations of First Empire that would actually have occurred had the Merger been in effect as of the date or for the period presented. In addition, this Current Report on Form 8-K includes forward-looking statements that are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("Future Factors"). Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Future Factors include: expected cost savings from the Merger that cannot be fully realized or that cannot be realized within the expected time frame; revenues following the Merger that are lower than expected; significant increases in competitive pressure among depository institutions; greater than expected costs or difficulties related to the integration of the business of First Empire and ONBANCorp; general economic conditions, either nationally or in the markets in which First Empire will be doing business, that are less favorable than expected; and legislative or regulatory requirements or changes that adversely affect the business in which First Empire is engaged. Future Factors also include changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; credit losses; sources of liquidity; regulatory supervision and oversight, including required capital levels; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes, including environmental regulations; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of pending and future litigation and governmental proceedings; continued availability of financing; and financial resources in the amounts, at the times and on the terms required to support the Company's future businesses. These are representative of the Future Factors that could affect the outcome of the forward-looking statements. First Empire's forward-looking statements speak only as of the date on which such statements are made. By making any forward-looking statements, First Empire assumes no duty to update them to reflect new, changing or unanticipated events or circumstances. (c) The following exhibits are filed herewith or incorporated by reference herein as a part of this report: EXHIBIT NO. 2.1 Agreement and Plan of Reorganization dated as of October 28, 1997 by and among First Empire State Corporation, Olympia -2- Financial Corp. and ONBANCorp, Inc. Incorporated by reference to Exhibit No. 2 to the Current Report on Form 8-K dated October 28, 1997 of First Empire State Corporation (File No. 1-9861).* 2.2 Agreement and Plan of Merger, dated as of October 28, 1997, by and among First Empire State Corporation, Olympia Financial Corp. and ONBANCorp, Inc. Incorporated by reference to Exhibit No. 2 to the Current Report on Form 8-K dated January 9, 1998 of First Empire State Corporation (File No. 1-9861).* 23 Consent of KPMG Peat Marwick LLP, independent auditors to ONBANCorp, Inc. Filed herewith.* 99.1 Press Release, dated April 1, 1998. Filed herewith.* 99.2 ONBANCorp, Inc. 1997 audited Financial Statements, together with the Report of the Independent Auditors thereon. Incorporated by reference to the Annual Report on Form 10-K of ONBANCorp, Inc. for the year ended December 31, 1997 (File No. 0-18011).* 99.3 First Empire State Corporation PRO FORMA Condensed Combined Balance Sheet as of December 31, 1997 (unaudited) and First Empire State Corporation PRO FORMA Condensed Combined Statement of Income for the year ended December 31, 1997 (unaudited). Filed herewith. __________________________ *Previously incorporated by reference into or filed with the initial filing of the Current Report on Form 8-K dated April 1, 1998 and filed on April 10, 1998. SIGNATURES 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 hereunto duly authorized. FIRST EMPIRE STATE CORPORATION Date: May 13, 1998 By: /s/ Michael P. Pinto ----------------------------------- Michael P. Pinto Executive Vice President and Chief Financial Officer -3- FORM 8-K/A (Amendment No. 1) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Report Dated: April 1, 1998 Commission File Number: 1-9861 ------ FIRST EMPIRE STATE CORPORATION (Exact name of registrant as specified in its charter) EXHIBITS -4- EXHIBIT INDEX Exhibit No. Page No. - ---------- ------- 2.1 Agreement and Plan of Reorganization dated as of * October 28, 1997 by and among First Empire State Corporation, Olympia Financial Corp. and ONBANCorp, Inc. Incorporated by reference to Exhibit No. 2 to the Current Report on Form 8-K dated October 28, 1997 of First Empire State Corporation (File No. 1-9861). 2.2 Agreement and Plan of Merger, dated as of October 28, 1997, * by and among First Empire State Corporation, Olympia Financial Corp. and ONBANCorp, Inc. Incorporated by reference to Exhibit No. 2 to the Current Report on Form 8-K dated January 9, 1998 of First Empire State Corporation (File No. 1-9861). 23 Consent of KPMG Peat Marwick LLP, independent auditors to * ONBANCorp, Inc. Filed herewith. 99.1 Press Release, dated April 1, 1998. Filed herewith. * 99.2 ONBANCorp, Inc. 1997 audited Financial Statements, together * with the Report of the Independent Auditors thereon. Incorporated by reference to the Annual Report on Form 10-K of ONBANCorp, Inc. for the year ended December 31, 1997 (File No. 0-18011). 99.3 First Empire State Corporation PRO FORMA Condensed Combined 7 Balance Sheet as of December 31, 1997 (unaudited) and First Empire State Corporation PRO FORMA Condensed Combined Statement of Income for the year ended December 31, 1997 (unaudited). Filed herewith. ______________________ *Previously incorporated by reference into or filed with the initial filing of the Current Report on Form 8-K dated April 1, 1998 and filed on April 10, 1998. -5- PRO FORMA CONDENSED COMBINED BALANCE SHEET (DOLLARS IN THOUSANDS) (UNAUDITED) The following pro forma condensed combined unaudited balance sheet gives effect to the acquisition by First Empire State Corporation ("First Empire") of ONBANCorp, Inc. and subsidiaries ("ONBANCorp") using the purchase method of accounting assuming the acquisition was consummated on December 31, 1997. ONBANCorp was acquired by First Empire on April 1, 1998.
DECEMBER 31, 1997 PRO FORMA FIRST EMPIRE ONBANCORP ADJUSTMENTS PRO FORMA ------------ --------- ----------- --------- ASSETS Cash and due from banks $ 333,805 128,647 $ 462,452 Money-market assets 111,046 11,222 122,268 Investment securities 1,725,218 2,016,633 (266,307) (1) 3,497,101 21,557 (2) Loans and leases 11,765,533 3,015,437 35,004 (3) 14,815,974 Unearned discount (268,965) (17,769) (7,249) (3) (293,983) Allowance for possible credit losses (274,656) (39,064) (313,720) ----------- --------- -------- ----------- Loans and leases, net 11,221,912 2,958,604 27,755 14,208,271 ----------- --------- -------- ----------- Premises and equipment 121,984 65,450 (13,255) (4) 174,179 Goodwill and deposit premium 17,288 13,892 547,331 (10) 578,511 Accrued interest and other assets 471,682 125,122 16,460 (5) 589,656 (23,608) (6) ----------- --------- -------- ----------- Total assets $14,002,935 5,319,570 309,933 $19,632,438 =========== ========= ======== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Interest-bearing deposits $ 9,704,917 3,643,007 6,686 (7) $13,354,610 Short-term borrowings 1,050,918 599,902 571 (8) 1,651,391 Long-term borrowings 427,819 283,148 10,941 (8) 721,908 ----------- --------- -------- ----------- Interest-bearing liabilities 11,183,654 4,526,057 18,198 15,727,909 ----------- --------- -------- ----------- Noninterest-bearing deposits 1,458,241 380,099 1,838,340 Other liabilities 330,774 78,217 19,689 (6) 428,680 ----------- --------- -------- ----------- Total liabilities 12,972,669 4,984,373 37,887 17,994,929 ----------- --------- -------- ----------- Common equity 1,030,266 335,197 272,046 (9) 1,637,509 ----------- --------- -------- ----------- Total stockholders' equity 1,030,266 335,197 272,046 1,637,509 ----------- --------- -------- ----------- Total liabilities & stockholders' equity $14,002,935 5,319,570 309,933 $19,632,438 =========== ========= ======== ===========
See notes to pro forma condensed combined financial information. -6- PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) The following pro forma condensed combined statement of income for the year ended December 31, 1997 gives effect to First Empire's acquisition of ONBANCorp using the purchase method of accounting assuming the acquisition was consummated on January 1, 1997. ONBANCorp was acquired by First Empire on April 1, 1998.
YEAR ENDED DECEMBER 31, 1997 -------------------------------------------------- PRO FORMA FIRST EMPIRE ONBANCORP ADJUSTMENTS PRO FORMA ------------ --------- ----------- --------- Interest income Loans and leases, including fees $ 952,436 224,900 (5,990) (11) $1,171,346 Money-market assets 7,245 1,864 9,109 Investment securities 105,280 158,926 (17,443) (12) 238,151 (8,612) (13) ---------- ------- -------- ---------- Total interest income 1,064,961 385,690 (32,045) 1,418,606 ---------- ------- ------- ---------- Interest expense Deposits 434,133 170,837 (6,432) (14) 598,538 Short-term borrowings 44,341 38,303 (497) (15) 82,147 Long-term borrowings 29,619 25,535 (880) (16) 54,274 ---------- ------- -------- ---------- Total interest expense 508,093 234,675 (7,809) 734,959 ---------- ------- -------- ---------- Net interest income 556,868 151,015 (24,236) 683,647 Provision for possible credit losses 46,000 7,168 53,168 ---------- ------- -------- ---------- Net interest income after provision for possible credit losses 510,868 143,847 (24,236) 630,479 ---------- ------- -------- ---------- Other income Mortgage banking revenues 51,547 5,016 56,563 Service charges on deposit accounts 43,377 11,283 54,660 Trust income 30,688 3,617 34,305 Merchant discount and other credit card fees 19,395 2,804 22,199 Gain (loss) on sales of bank investment securities (280) 10,360 10,080 Other revenues from operations 48,340 9,199 57,539 ---------- ------- ---------- Total other income 193,067 42,279 235,346 ---------- ------- ---------- Other expense Salaries and employee benefits 220,017 41,027 261,044 Equipment and net occupancy 53,299 18,440 (428) (17) 71,311 Printing, postage and supplies 13,747 3,666 17,413 Deposit insurance 1,935 1,058 2,993 Outside data processing 7,153 11,285 18,438 Amortization of goodwill and deposit premium 7,291 4,287 31,869 (18) 43,447 Other costs of operations 118,334 26,143 4,246 (19) 148,723 ---------- ------- -------- ---------- Total other expense 421,776 105,906 35,687 563,369 ---------- ------- -------- ---------- Income before income taxes 282,159 80,220 (59,923) 302,456 Income taxes 105,918 29,042 (15,998) (20) 118,962 ---------- ------- -------- ---------- Net income $ 176,241 51,178 (43,925) $ 183,494 ========== ======= ======== ========== Net income per common share (21) Basic $26.60 3.93 $22.78 Diluted $25.26 3.88 $21.77 Average common shares outstanding (21) Basic 6,625 13,024 8,055 Diluted 6,977 13,181 8,429
See notes to pro forma condensed combined financial information. -7- NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION (Unaudited) (1) The unaudited pro forma condensed combined financial information assumes the cash portion of the purchase price of $266,307 is provided by liquidation of investment securities. (2) Adjustment to record acquired investment securities at estimated market value. (3) Adjustments to record acquired loans and leases at estimated market value. (4) Adjustment to record acquired premises and equipment at estimated market value. The adjustment includes writedowns associated with duplicate owned property and leasehold interests of ONBANCorp to be disposed of. (5) Adjustments of $9,221 to record acquired mortgage servicing rights at estimated market value and $7,239 to record pension plan assets of ONBANCorp in excess of projected benefit obligation. (6) Adjustments to other assets and other liabilities of $23,608 and $19,689, respectively, to record fees for investment bankers and other professional services associated with the transaction, severance benefits associated with the elimination of employment positions at ONBANCorp, estimated net deferred income tax credits associated with adjustments to fair value of net assets acquired, and other miscellaneous adjustments. (7) Adjustment to record interest-bearing deposits of ONBANCorp at estimated market value. (8) Adjustments to record borrowings (including trust preferred capital securities) of ONBANCorp at estimated market value. (9) Reflects issuance of First Empire common stock of $587,819, estimated market value of ONBANCorp stock options converted to First Empire stock options of $19,424 and reduction for elimination of ONBANCorp's December 31, 1997 equity of $335,197. (10) Represents core deposit premium of $61,371 and additional goodwill of $485,960. NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION (Unaudited) (Continued) (11) Amortization of premium related to loans and leases using accelerated methods based on the estimated weighted-average maturities of the loans and leases. (12) Reduction in interest income from investment securities assumed to be liquidated to fund the cash component of the merger consideration assuming an interest rate of 6.55%. (13) Amortization of premium related to investment securities assumed to be retained using an accelerated method over the estimated weighted-average remaining term to maturity of the securities. (14) Amortization of mark-to-market adjustment to deposits using an effective yield method over the remaining terms to maturity of the deposits. (15) Amortization of mark-to-market adjustment to short-term borrowings on a straight-line basis over the remaining terms to maturity of the borrowings. (16) Amortization of mark-to-market adjustment to long-term borrowings on a straight-line basis over the remaining terms to maturity of the borrowings. (17) Amortization of mark-to-market adjustment on premises and equipment on a straight-line basis over the estimated useful lives of the assets. (18) Amortization on an accelerated basis of the core deposit premium and on a straight-line basis for goodwill:
ESTIMATED LIFE AMOUNT -------------- ------ (In years) (In thousands) Core deposit premium 10 11,158 Goodwill 20 20,715 ------ Total amortization 31,869
(19) Amortization on an accelerated basis of the mark-to-market adjustment on mortgage servicing rights and other miscellaneous adjustments. (20) Income tax expense on pro forma adjustments is reflected using an expected tax rate of 40.8%. (21) The pro forma earnings per share include the effect of the adjustments described above and the issuance 1,429,998 shares of First Empire common stock. The calculation of pro forma diluted earnings per share also includes the dilutive effect of ONBANCorp stock options converted to First Empire stock options by application of the "treasury stock method" of accounting. -----END PRIVACY-ENHANCED MESSAGE-----