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EX-99.2 - Polonia Bancorp | v205684_ex99-2.htm |
EX-99.1 - Polonia Bancorp | v205684_ex99-1.htm |
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): December 10, 2010
POLONIA
BANCORP
(Exact
Name of Registrant as Specified in Its Charter)
United States | 0- 52267 | 41-2224099 |
(State or other jurisdiction of | (Commission | (IRS Employer |
incorporation or organization) | File Number) | Identification No.) |
3993 Huntingdon Pike,
3rd Floor, Huntingdon Valley,
Pennsylvania 19006
(Address
of principal executive offices) (Zip Code)
(215)
938-8800
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Item 1.01.
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Entry
into a Material Definitive
Agreement.
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On
December 10, 2010, Polonia Bank (“Polonia”), the wholly-owned subsidiary of
Polonia Bancorp (the “Company”), assumed certain of the deposits and acquired
certain assets of Earthstar Bank, a state chartered bank headquartered in
Southampton, Pennsylvania (“Earthstar”), from the Federal Deposit Insurance
Corporation (the “FDIC”), as receiver for Earthstar, pursuant to the terms of
the Purchase and Assumption Agreement – Whole Bank; All Deposits, dated December
10, 2010, by and among the FDIC, as receiver, Polonia and the FDIC (the
“Agreement”).
Polonia
acquired approximately $57 million in assets, including approximately $46
million in loans (comprised primarily of single-family residential and home
equity loans (“Single-Family Loans”) and commercial business and commercial real
estate loans (“Commercial Loans”)), and approximately $11 million in investment
securities. Polonia also assumed approximately $90 million in
deposits.
The
deposits were acquired without a premium and certain loans were acquired at a
discount to Earthstar’s historic book value, subject to customary
adjustments. The terms of the Agreement provide for the FDIC to
indemnify Polonia against claims with respect to liabilities and assets of
Earthstar or any of its affiliates not assumed or otherwise purchased by Polonia
and with respect to certain other claims by third parties.
All of
Earthstar’s four banking offices located in Southampton and Philadelphia,
Pennsylvania have reopened as branches of Polonia. The physical
branch locations and leases were not immediately acquired by Polonia. Polonia
has an option, exercisable for 90 days, to acquire, at fair market value, any
bank premises that were owned by, or any leases relating to bank premises held
by, Earthstar. Polonia is currently reviewing the bank premises and related
leases of Earthstar.
Loss
Sharing Arrangements
In
connection with the transaction, Polonia entered into loss sharing agreements
with the FDIC that collectively cover all of the loans Polonia is acquiring
(referred to collectively as “covered assets”). Certain other assets of
Earthstar were acquired by Polonia that are not covered by loss sharing
agreements with the FDIC. These assets include approximately $11 million of
investment securities purchased at fair market value.
Pursuant
to the terms of the loss sharing agreements, the FDIC’s obligation to reimburse
Polonia for losses with respect to covered assets begins with the first dollar
of loss incurred. The FDIC will reimburse Polonia for 80% of losses with respect
to covered assets. Polonia will reimburse the FDIC for 80% of recoveries with
respect to losses for which the FDIC paid Polonia 80% reimbursement under the
loss sharing agreements. The loss sharing agreements applicable to
the Single-Family Loans provides for FDIC loss sharing and Polonia reimbursement
to the FDIC for ten years. The loss sharing agreement applicable to the
Commercial Loans provides
for FDIC loss sharing for five years and Polonia reimbursement to the FDIC for
eight years, in each case, on the same terms and conditions as described
above.
The above
reimbursable losses and recoveries are based on the book value of the relevant
loans as determined by the FDIC as of the effective date of the transaction. The
amount that Polonia realizes on these assets could differ materially from the
carrying value that will be reflected in any financial statements, based upon
the timing and amount of collections and recoveries on the covered assets in
future periods.
Item 2.01.
Completion of Acquisition or Disposition of Assets.
The
information set forth under Item 1.01 “Entry into a Material Definitive
Agreement” is incorporated by reference into this Item 2.01.
Item 8.01.
Other Events.
On July
23, 2010, the Company announced that its Board of Directors had approved the
repurchase for up to 67,032 shares of the Company’s outstanding common stock
held by persons other than Polonia MHC through a Rule 10b5-1 repurchase
plan. That repurchase plan will be suspended as a result of the
Earthstar transaction. A press release announcing the suspension of
the repurchase plan is attached hereto as Exhibit 99.2 and incorporated herein
by reference.
Item 9.01.
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Financial
Statements and Exhibits.
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(a)
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Financial
Statements of Business Acquired
To
the extent that financial statements are required by this Item, such
financial statements will be filed in an amendment to this Form 8-K no
later than February 25, 2011.
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(b)
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Pro
Forma Financial Information
To the extent that pro forma financial
information is required by this Item, such information will be filed in an
amendment to this Form 8-K no later than February 25,
2011.
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(d)
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Exhibits.
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Exhibit No.
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Description
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99.1
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Press
Release announcing the Acquisition, dated December 10,
2010
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99.2
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Press Release announcing the suspension of the stock repurchase plan, dated December 15, 2010 |
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.
Date:
December 15, 2010
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By: /s/ Paul D.
Rutkowski
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Paul
D. Rutkowski
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Chief
Financial Officer and
Treasurer
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