Attached files
| file | filename |
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| EX-2.1 - North Penn Bancorp Inc | v205819_ex2-1.htm |
| EX-99.1 - North Penn Bancorp Inc | v205819_ex99-1.htm |
| EX-10.1 - North Penn Bancorp Inc | v205819_ex10-1.htm |
| EX-10.2 - North Penn Bancorp Inc | v205819_ex10-2.htm |
| EX-10.4 - North Penn Bancorp Inc | v205819_ex10-4.htm |
| EX-10.3 - North Penn Bancorp Inc | v205819_ex10-3.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 14, 2010
NORTH PENN BANCORP,
INC.
(Exact
Name of Registrant as Specified in Its Charter)
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Pennsylvania
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000-52839
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26-0261305
|
|
(State
or other jurisdiction of
incorporation
or organization)
|
(Commission
File
Number)
|
(IRS
Employer
Identification
No.)
|
216 Adams Avenue, Scranton,
Pennsylvania 18503
(Address
of principal executive offices) (Zip Code)
(570)
344-6113
(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)
x
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. Entry
into a Definitive Material Agreement.
On December 14, 2010, North Penn
Bancorp, Inc. (“North Penn”), the parent company of North Penn Bank, and Norwood
Financial Corp. (“Norwood Financial”), the parent company of Wayne Bank, entered
into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which
North Penn will merge with and into Norwood Financial. Concurrent with the
merger, it is expected that North Penn Bank will merge with and into Wayne
Bank.
Under the terms of the Merger
Agreement, each outstanding share of North Penn common stock will be converted
into either the right to receive $19.12 in cash or 0.6829 shares of Norwood
Financial common stock. In addition, the elections of North Penn stockholders
will be subject to the requirement that $12,194,000 of the merger consideration
(which includes amounts paid in cancellation of existing stock options) be paid
in cash and that the remainder be paid in Norwood common stock. All North Penn
stock options, whether or not vested, will be canceled at the effective time of
the merger in exchange for a cash payment equal to the difference between $19.12
and the exercise price of the stock option.
The
transaction is subject to termination by North Penn if the price of Norwood
Financial common stock both declines by 20% during a defined measurement period
and underperforms the Nasdaq Bank Index by 20% during that same period, unless
Norwood Financial increases the exchange ratio for the stock portion of the
merger consideration as set forth in the merger agreement.
The
senior management of Wayne Bank will remain the same following the merger. At
the closing of the merger, Norwood Financial and Wayne Bank will each expand the
size of its board by one member and appoint one member of the North Penn board
of directors to its board.
The
transaction is subject to customary closing conditions, including the receipt of
regulatory approvals and approval by the shareholders of North
Penn. The merger is currently expected to be completed in the second
quarter of 2011.
Each of
the directors and executive officers of North Penn have agreed to vote their
shares in favor of the approval of the Merger Agreement at the shareholders
meeting to be held to vote on the proposed transaction. If the merger is not
consummated under certain circumstances, North Penn has agreed to pay Norwood
Financial a termination fee of $1,125,000.
The
Merger Agreement also contains usual and customary representations and
warranties that Norwood Financial and North Penn made to each other as of
specific dates. The assertions embodied in those representations and warranties
were made solely for purposes of the contract between Norwood Financial and
North Penn, and may be subject to important qualifications and limitations
agreed to by the parties in connection with negotiating its terms. Moreover, the
representations and warranties are subject to a contractual standard of
materiality that may be different from what may be viewed as material to
shareholders, and the representations and warranties may have been used to
allocate risk between Norwood Financial and North Penn rather than establishing
matters as facts.
The foregoing summary of the Agreement
is not complete and is qualified in its entirety by reference to the complete
text of such document, which is filed as Exhibit 2.1 to this Form 8-K and which
is incorporated herein by reference in its entirety.
Norwood Financial will be filing a
registration statement containing a proxy statement/prospectus and other
documents regarding the proposed transaction with the SEC. North Penn
shareholders are urged to read the proxy statement/prospectus when it becomes
available, because it will contain important information about Norwood Financial
and North Penn and the proposed transaction. When available, copies of this
proxy statement/prospectus will be mailed to North Penn shareholders. Copies of
the proxy statement/prospectus may be obtained free of charge at the SEC’s web
site at http://www.sec.gov, or by directing a request to Norwood Financial
Corp., 717 Main Street, Honesdale, Pennsylvania 18431, or to North Penn Bancorp,
Inc., 216 Adams Avenue, Scranton, PA 18503. Copies of other documents filed by
Norwood Financial and North Penn with the SEC may also be obtained free of
charge at the SEC’s web site or by directing a request to Norwood Financial or
North Penn at the address provided above.
North Penn and its directors, executive
officers and certain other members of management and employees may be soliciting
proxies from their shareholders in favor of the proposed transaction.
Information regarding such persons who may, under the rules of the SEC, be
considered to be participants in the solicitation of North Penn’s shareholders
in connection with the proposed transaction is set forth in North Penn’s proxy
statement filed with the SEC in connection with North Penn’s annual meeting of
shareholders held on May 25, 2010. Additional information will be set forth in
the proxy statement/prospectus when it is filed with the SEC.
A copy of the press release announcing
the execution of the Merger Agreement is filed as Exhibit 99.1 to this Form 8-K
and is incorporated herein by reference in its entirety.
Item
5.02. Departure of Directors or
Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
On December 14, 2010, and in connection
with the execution of the Merger Agreement, North Penn and North Penn Bank
entered into addenda to the existing employment agreements of Fred Hickman,
President and Chief Executive Officer of North Penn and North Penn Bank, Thomas
A. Byrne, Senior Vice President of North Penn and North Penn Bank, and Thomas J.
Dziak, Executive Vice President of North Penn and North Penn
Bank. North Penn Bank and Mr. Hickman also entered into an addendum
to his Amended and Restated Supplement Executive Retirement
Agreement.
The addendum to Mr. Hickman’s
employment agreement (i) provides that, notwithstanding anything in the
employment agreement to the contrary, the maximum severance payment to be made
to Mr. Hickman under the employment agreement will be $597,344, (ii) prohibits
him from increasing the value of his severance payment by exercising stock
options prior to the end of 2010, and (iii) requires a full release from all
obligations and claims upon termination of employment.
The addendum to Mr. Hickman’s
Supplemental Executive Retirement Agreement provides that Section 2.5 of that
agreement, which provides for a specified retirement benefit if he is terminated
following a change in control of North Penn Bank, shall be null and void and
without effect. The addendum also provides that if Mr. Hickman
remains employed until the closing of the merger and receives a severance
payment under Section 5 of his employment agreement, he will be entitled to
receive the Voluntary Early Termination Benefit under Section 2.2 of the
agreement and not the Involuntary Early Termination Benefit under
Section 2.3 of the agreement.
The addendum to Mr. Byrne’s employment
agreement (i) provides for a payment of $50,000 if he is employed by Norwood
Financial one month following the merger and another $30,000 if he is employed
by Norwood Financial 12 months following the merger, (ii) provides for a period
of non-competition that expires the later of one year after the merger or three
months after termination of employment, and (iii) prevents him from increasing
the value of the severance payment that would due to him if he is terminated
following a change in control of North Penn by exercising stock options prior to
the end of 2010.
The addendum to Mr. Dziak’s employment
agreement (i) provides for a period of non-competition that expires the later of
four months after the merger or three months after termination of employment,
(ii) prevents him from increasing the value of his severance payment that would
due to him if he is terminated following a change in control of North Penn by
exercising stock options prior to the end of 2010, and (iii) requires a full
release from all obligations and claims upon termination of
employment.
Item
9.01. Financial Statements and
Exhibits.
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d.
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Exhibits
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Exhibit Number
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Description
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2.1
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Agreement
and Plan of Merger, dated December 14, 2010, by and among Norwood
Financial Corp., Wayne Bank, North Penn Bancorp, Inc. and North Penn
Bank. The schedules and certain exhibits have been omitted from
the Agreement as filed with the SEC. The omitted information is
considered immaterial from an investor’s perspective. North
Penn Bancorp, Inc. will furnish to the SEC supplementally a copy of any
omitted schedules or exhibit upon request from the SEC.
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10.1
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Addendum
to the Amended and Restated Employment Agreement between North Penn
Bancorp, Inc., North Penn Bank and Frederick L. Hickman
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10.2
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Addendum
to the Amended and Restated Employment Agreement between North Penn
Bancorp, Inc., North Penn Bank and Thomas J. Dziak
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10.3
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Addendum
to the Amended and Restated Employment Agreement between North Penn
Bancorp, Inc., North Penn Bank and Thomas A. Byrne
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10.4
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Addendum
to the Amended and Restated Supplemental Executive Retirement Agreement
dated March 23, 2010 between North Penn Bank and Frederick L.
Hickman
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99.1
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Press
release dated December 15,
2010.
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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.
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Date: December
16, 2010
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By:
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/s/ Frederick L. Hickman
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Frederick
L. Hickman
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President
and Chief Executive
Officer
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