Vermont Business Magazine Community Bank System, Inc (NYSE: CBU) and Merchants Bancshares, Inc (NASDAQ: MBVT) announced Wednesday that they have received, as expected, regulatory approvals from the Board of Governors of the Federal Reserve System and Office of the Comptroller of the Currency for their proposed merger. As previously reported by VBM, Community Bank System and Merchants also announced they have set Friday, May 12, 2017, as the closing date for the $304 million merger, subject to the satisfaction of customary closing conditions. The election process that is currently underway to permit the Merchants stockholders to elect the form of their merger consideration is being extended to May 9, 2017.
On October 22, 2016, Merchants Bancshares, based in South Burlington, and Community Bank System, Inc of Syracuse, NY, entered into a definitive agreement under which Community Bank System will acquire Merchants in a cash and stock transaction valued at $304 million. The combination will provide natural market extension for both companies, joining two banks known for their high-quality, low-risk franchises with long histories of service to their customers and communities. Merchants Bank will be rebranded Community Bank. Merchants is the last of the statewide banks based in Vermont. It has 31 branches, by far the most of any local bank in the state, and third to People's United (40) and TD Bank (32). Merchants has just over $2 billion in assets, more than double any other Vermont--based bank.
Under the terms of the agreement, shareholders of Merchants Bancshares will have the option to receive, at their election, consideration per share equal to (i) 0.963 shares of Community Bank System, Inc. common stock, (ii) $40.00 in cash or (iii) the combination of 0.6741 shares of Community Bank System, Inc. common stock and $12.00 in cash, subject to an overall proration to 70% stock and 30% cash.
Election Procedures for Merchants Stockholders
Merchants stockholders previously received from American Stock Transfer & Trust Company, LLC, the Exchange Agent for the merger, a Letter of Election and Transmittal to be used for the purpose of electing the form of merger consideration to be received in the merger. The deadline for completing and submitting the Letter of Election and Transmittal to the Exchange Agent has been extended to 5:00 P.M. (Eastern time) on May 9, 2017. Merchants stockholders must complete and submit the Letter of Election and Transmittal by that deadline if they wish to elect the form of merger consideration to be received in the merger, which election is subject to the allocation procedures set forth in the Merger Agreement and the Proxy Statement/Prospectus previously mailed to Merchants stockholders. If a Merchants stockholder’s valid election as to the form of merger consideration is not received prior to the election deadline of 5:00 P.M. (Eastern time) on May 9, 2017, each of such stockholder’s shares of Merchants common stock, upon consummation of the merger, will be converted into the right to receive 0.6741 shares of Community Bank System common stock and $12.00 in cash. Merchants stockholders who do not submit a Letter of Election and Transmittal by the election deadline will be sent a separate letter of transmittal following consummation of the merger for the purposes of exchanging their Merchants shares into the merger consideration.
Merchants stockholders who need a duplicate copy of the Letter of Election and Transmittal and instructions or who have questions about making an election prior to the election deadline of 5:00 P.M. (Eastern time) on May 9, 2017 may contact American Stock Transfer & Trust Company, LLC, the Exchange Agent for the merger, at:
American Stock Transfer & Trust Company, LLC
6201 15th Avenue
Brooklyn, NY 11219
(877) 248-6417 or (718) 921-8317
About Community Bank System, Inc.
Community Bank System, Inc. operates more than 200 customer facilities across Upstate New York and Northeastern Pennsylvania through its banking subsidiary, Community Bank, N.A. With assets of approximately $8.9 billion, the DeWitt, N.Y. headquartered company is among the country’s 150 largest financial institutions. In addition to a full range of retail and business banking services, the Company offers comprehensive financial planning, insurance and wealth management services. The Company’s Benefit Plans Administrative Services, Inc. subsidiary is a leading provider of employee benefits administration and trust services, and actuarial and consulting services to customers on a national scale. Community Bank System, Inc. is listed on the New York Stock Exchange and the Company’s stock trades under the symbol CBU. For more information about Community Bank visit www.communitybankna.com or http://ir.communitybanksystem.com.
About Merchants Bancshares, Inc.
Merchants Bancshares, Inc. reported total assets at March 31, 2017 of approximately $2.02 billion. Merchants Bancshares, Inc. is the holding company for Merchants Bank. The bank’s business, municipal, consumer, and investment customers enjoy personalized relationships, sophisticated online and mobile banking options, with 31 branches in Vermont and 1 location in Massachusetts, operating as NUVO, a division of Merchants Bank. Merchants Bancshares, Inc. is listed on the NASDAQ Stock Market and trades under the symbol MBVT. For more information about Merchants Bank visit www.mbvt.com.
| Vermont Deposits | |||||||
| State: | County: | City: | Zip Code: | ||||
| VERMONT | ALL | ALL | ALL | Inside of | |||
| Market | |||||||
| Institution Name | CERT | State | Bank | State/ | No. of | Deposits | Market |
| (Hqtrd) | Class | Federal | Offices | $0 | Share | ||
| Charter | |||||||
| People's United Bank, National Association | 27334 | CT | N | Federal | 40 | 2,898,935 | 22.97% |
| TD Bank, National Association | 18409 | DE | N | Federal | 32 | 2,532,475 | 20.07% |
| Merchants Bank | 6268 | VT | NM | State | 31 | 1,360,751 | 10.78% |
| KeyBank National Association | 17534 | OH | N | Federal | 12 | 825,324 | 6.54% |
| Citizens Bank, National Association | 57957 | RI | N | Federal | 20 | 812,025 | 6.43% |
| Northfield Savings Bank | 14140 | VT | SB | State | 13 | 615,888 | 4.88% |
| Union Bank | 14158 | VT | NM | State | 12 | 476,987 | 3.78% |
| Community National Bank | 6271 | VT | N | Federal | 12 | 469,808 | 3.72% |
| Passumpsic Savings Bank | 14134 | VT | SB | State | 6 | 361,044 | 2.86% |
| Mascoma Savings Bank | 18013 | NH | SB | Federal | 10 | 349,293 | 2.77% |
| Berkshire Bank | 23621 | MA | NM | State | 6 | 334,603 | 2.65% |
| Lake Sunapee Bank, FSB | 31953 | NH | SB | Federal | 14 | 296,987 | 2.35% |
| The National Bank of Middlebury | 6275 | VT | N | Federal | 7 | 282,310 | 2.24% |
| The Bank of Bennington | 30350 | VT | SB | Federal | 4 | 270,375 | 2.14% |
| Peoples Trust Company of St. Albans | 14168 | VT | NM | State | 6 | 220,325 | 1.75% |
| The Brattleboro Savings and Loan Association | 28837 | VT | SB | State | 2 | 140,625 | 1.11% |
| Wells River Savings Bank | 14136 | VT | SB | State | 6 | 134,795 | 1.07% |
| NBT Bank, National Association | 7230 | NY | N | Federal | 4 | 82,867 | 0.66% |
| Ledyard National Bank | 33418 | VT | N | Federal | 1 | 75,685 | 0.60% |
| The First National Bank of Orwell | 6280 | VT | N | Federal | 2 | 49,800 | 0.39% |
| Claremont Savings Bank | 18038 | NH | SB | State | 1 | 18,515 | 0.15% |
| TrustCo Bank | 31945 | NY | SB | Federal | 1 | 10,442 | 0.08% |
| Wilmington Trust, National Association | 34069 | DE | N | Federal | 1 | 0 | 0.00% |
| Number of Institutions in the Market:23 | TOTALS | 243 | 12,619,859 | 100 | |||
Important Information for Investors and Shareholders
Community Bank System has filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4 containing a proxy statement of Merchants and a prospectus of Community Bank System, and Community Bank System will file other documents with respect to the proposed merger. A definitive proxy statement/prospectus was mailed to shareholders of Merchants. Investors and security holders of Merchants are urged to read the proxy statement/prospectus and other documents that were filed with the SEC carefully and in their entirety because they contain important information. Investors and security holders are able to obtain free copies of the registration statement and the proxy statement/prospectus and other documents filed with the SEC by Community Bank System through the website maintained by the SEC at http://www.sec.gov. You are also able to obtain these documents free of charge from Merchants at http://www.mbvt.com/ under the heading “Investor Relations” and then “SEC Filings” or from Community Bank System by accessing its website at www.communitybankna.com under the heading of “Investor Relations” and then “SEC Filings & Annual Report.” Copies of the proxy statement/prospectus can also be obtained, free of charge, by directing a request to Merchants Bancshares, Inc., P.O. Box 1009, Burlington, Vermont 05402, Attention: Investor Relations, Telephone: (800) 322-5222 or to Community Bank System, Inc., 5790 Widewaters Parkway, DeWitt, New York 13214, Attention: Investor Relations, Telephone: (315) 445-2282.
SYRACUSE, N.Y. & SOUTH BURLINGTON, Vt.--(BUSINESS WIRE)--Community Bank System, Inc. and Merchants Bancshares, Inc.