Independent Bank Corp. (NASDAQ: INDB), parent of Rockland Trust
Company, today announced the closing of its acquisition of Central
Bancorp, Inc. (NASDAQ: CEBK), parent of Central Bank.
“This acquisition significantly increases Rockland Trust’s
presence in Middlesex County and we welcome Central Bank customers
and employees to Rockland Trust,” said Christopher Oddleifson,
President and Chief Executive Officer of Rockland Trust. “The
demographics of our new territory are very attractive, and we
anticipate that this acquisition will be immediately accretive and
deliver solid returns to our shareholders.”
The legal closing occurred today and the acquisition will be
effective as of 12:01 a.m. on Saturday, November 10, 2012. As of
the effective time Central Bancorp, Inc. was legally merged with
and into Independent Bank Corp., with Independent the surviving
entity, and Central Bank legally merged with and into Rockland
Trust, with Rockland Trust the surviving entity. Central Bank will
continue to operate under its name, as a division of Rockland
Trust, until the customer and facilities conversion is complete in
the first quarter of 2013, at which time the nine former Central
Bank branches will be converted into Rockland Trust branches.
Effective as of the completion of the acquisition, former
Central Director John J. Morrissey was appointed a Class I Director
of Independent Bank Corp., with a term expiring at the 2015 Annual
Shareholder Meeting, and was also appointed a Director of Rockland
Trust. Mr. Morrissey is a founding partner of the Braintree,
Massachusetts law firm Morrissey, Wilson, Zafiropoulos LLP, a
boutique law firm practicing in the areas of litigation, bankruptcy
and creditors’ rights, and real estate. Mr. Morrissey’s practice is
primarily in the area of litigation, with a principle focus on
personal injury and workers compensation claims. Mr. Morrissey is a
member of the Board of Bar Overseers’ Hearing Committee for
Plymouth and Norfolk Counties. He is a member of the Massachusetts
Academy of Trial Attorneys’ Board of Governors and the
Massachusetts Bar Association’s House of Delegates. Mr. Morrissey
was recently appointed Chair of the Massachusetts Bar Association’s
Judicial Administration Section Council for 2012-2013 and serves on
the Workplace Safety Task Force. Mr. Morrissey, who is 45 years
old, is a graduate of the University of Massachusetts, Amherst and
of the Boston University School of Law. Mr. Morrissey resides in
Hingham, Massachusetts with his wife Katherine and their three
children.
Immediately prior to the legal closing Central redeemed the
10,000 shares of Central’s Senior Non-Cumulative Perpetual
Preferred Stock, Series B (the “Series B Preferred Stock”), issued
pursuant to the Small Business Lending Fund program, by paying the
United States Department of the Treasury the Ten Million Dollars
($10,000,000) liquidation amount of the Series B Preferred Stock,
plus accrued but unpaid dividends. On November 9, 2012 Independent
made an unsecured loan to Central, the proceeds of which were
immediately used to pay the redemption cost of the Series B
Preferred Stock just prior to the legal closing. Independent funded
its unsecured loan to Central by drawing approximately Ten Million
Dollars ($10,000,000) from its recently established line of credit
with PNC Bank, National Association. Independent anticipates that
it will repay the amount drawn from that line of credit, in full,
within 12 to 24 months. The corresponding asset and liability
associated with the unsecured loan from Independent to Central,
which were equal and offsetting, were cancelled in connection with
the financial consolidation of Central and Independent.
The results of the elections made by Central shareholders as to
the form of consideration to be received due to the merger are as
follows:
Stock Elections: Central shareholders who validly elected
to receive all Independent common stock will receive 1.0533 shares
of Independent common stock for each share of Central common stock
with respect to which that election was made;
Non-Elections: Central shareholders who validly elected
either the “No Preference” choice or who did not make a valid
election will receive 1.0533 shares of Independent common stock for
each share of Central common stock held immediately prior to the
merger; and
Cash Elections: Cash elections were oversubscribed and
therefore subject to the pro-ration calculations specified in the
merger agreement, so that in the aggregate 60% of the shares of
Central common stock outstanding immediately prior to the merger
were converted into shares of Independent common stock and the
remaining 40% of the shares of Central common stock outstanding
immediately prior to the merger were converted into the right to
receive $32.00 in cash, without interest. Due to the pro-ration
required by the oversubscription of cash elections, Central
shareholders who validly elected to receive cash will receive
$32.00 in cash, without interest, for 52.8385% of their shares and
1.0533 shares of Independent common stock for 47.1615% of their
shares.
Under the terms of the merger agreement, cash will be issued in
lieu of fractional shares.
As a result of the elections and pro-ration described above,
Central shareholders will receive an aggregate of approximately
1,068,647 shares of Independent common stock and an aggregate of
$21,644,160 in cash, which does not include cash in lieu of
fractional shares. Independent now has approximately, including the
shares issued in connection with the acquisition, 22,748,865 shares
of common stock outstanding.
About Independent Bank Corp.
Independent Bank Corp., which has Rockland Trust Company as its
wholly-owned commercial bank subsidiary, has approximately $5.7
billion in assets. Rockland Trust offers a wide range of commercial
banking products and services, retail banking products and
services, business and consumer loans, insurance products and
services, and investment management services. To find out why
Rockland Trust is the bank “Where Each Relationship Matters®”,
visit www.RocklandTrust.com.
About Central Bancorp., Inc.
Central Bancorp, Inc. is holding company for Central Bank, whose
legal name is Central Co-Operative Bank and which was founded in
1915 as a Massachusetts chartered co-operative bank to provide
savings deposits and originate mortgage loans. Central Bank is a
full-service community banking operation that provides a variety of
deposit and lending services --- including savings and checking
accounts for retail and business customers, mortgage loans for
constructing, purchasing and refinancing residential and commercial
properties, and loans for education, home improvement and other
purposes. Central Bank operates nine full-service offices in the
Massachusetts communities of Somerville, Arlington, Burlington,
Chestnut Hill, Malden, Medford, Melrose, and Woburn (two
branches).
Forward Looking Statements:
Statements contained in this filing that are not statements of
historical fact constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
(the “Act”), notwithstanding that such statements are not
specifically identified. In addition, statements in future filings
of Independent with the Securities Exchange Commission (the “SEC”),
in press releases, and in oral and written statements made by or
with the approval of Independent that are not statements of
historical fact may also constitute forward-looking statements
within the meaning of the Act. Examples of forward-looking
statements include, but are not limited to: (i) statements
about the benefits of the merger, including future financial and
operating results, cost savings, enhanced revenues, and accretion
to reported earnings that may be realized from the merger;
(ii) statements of plans, objectives, and expectations of
management or the Boards of Directors; (iii) statements of
future economic performance; and (iv) statements of assumptions
underlying such statements. Words such as “believes,”
“anticipates,” “expects,” “intends,” “targeted,” “continue,”
“remain,” “will,” “should,” “may” and other similar expressions are
intended to identify forward-looking statements but are not the
exclusive means of identifying such statements.
Forward-looking statements are not guarantees of future
performance and involve certain risks, uncertainties, and
assumptions which are difficult to predict. Actual outcomes and
results, therefore, may differ materially from what is expressed or
forecasted in such forward-looking statements. Factors that could
cause actual results to differ from those discussed in the
forward-looking statements include, but are not limited to:
(i) the risk that the businesses involved in the merger will
not be integrated successfully or such integration may be more
difficult, time-consuming, or costly than expected;
(ii) expected revenue synergies and cost savings from the
merger may not be fully realized or realized within the expected
time frame; (iii) revenues following the merger may be lower
than expected; (iv) deposit attrition, operating costs,
customer loss and business disruption following the merger
including, without limitation, difficulties in maintaining
relationships with employees, may be greater than expected;
(v) local, regional, national and international economic
conditions and the impact they may have; (vii) changes in
interest rates, spreads on earning assets and interest-bearing
liabilities, and interest rate sensitivity; (viii) prepayment
speeds, loan originations, and credit losses; (ix) sources of
liquidity; (x) shares of common stock outstanding and common
stock price volatility; (xi) fair value of and number of
stock-based compensation awards to be issued in future periods;
(xii) legislation affecting the financial services industry as
a whole, and/or the parties and their subsidiaries individually or
collectively; (xiii) regulatory supervision and oversight,
including required capital levels; (xiv) increasing price and
product/service competition by competitors, including new entrants;
(xv) rapid technological developments and changes;
(xvi) the ability to continue to introduce competitive new
products and services on a timely, cost-effective basis;
(xvii) the mix of products/services; (xiii) containing
costs and expenses; (xix) governmental and public policy
changes; (xx) protection and validity of intellectual property
rights; (xxi) reliance on large customers;
(xxii) technological, implementation and cost/financial risks
in large, multi-year contracts; (xxiii) the outcome of pending
and future litigation and governmental proceedings;
(xxiv) continued availability of financing;
(xxv) financial resources in the amounts, at the times, and on
the terms required to support future business; and,
(xxvi) material differences in the actual financial results of
merger and acquisition activities compared with expectations,
including the full realization of anticipated cost savings and
revenue enhancements. Additional factors that could cause
Independent’s results to differ materially from those described in
the forward-looking statements can be found in Independent’s and
Central’s respective Annual Report on Form 10-K, Quarterly Reports
on Form 10-Q, and Current Reports on Form 8-K filed with the SEC.
All subsequent written and oral forward-looking statements
concerning the transaction or other matters are expressly qualified
in their entirety by the cautionary statements referenced above.
Forward-looking statements speak only as of the date on which such
statements are made. Independent undertakes no obligation to update
any forward-looking statement to reflect events or circumstances
after the date on which it was made, or to reflect the occurrence
of unanticipated events.
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