"LEWISTON, Idaho, Feb. 24 /PRNewswire-FirstCall/ --
FirstBank NW Corp. (Nasdaq: FBNW), Lewiston, Idaho announced today the
execution of a definitive agreement to merge with
Oregon Trail Financial Corp. (Nasdaq: OTFC), Baker City, Oregon, and its
wholly-owned subsidiary, Pioneer Bank, A Federal Savings Bank, a $380.2
million federal savings bank that operates nine full-service retail sales
offices in seven eastern Oregon counties.
"We are pleased about the merger with Pioneer Bank and look forward to
serving the Eastern Oregon communities," said Clyde Conklin, chief executive
officer of FirstBank. "Pioneer Bank's strong community orientation fits well
with FirstBank's community banking philosophy. We look forward to working with
the quality employees at Pioneer Bank and remain committed to delivering
exceptional customer service to the Eastern Oregon marketplace. The blended
companies will be able to deliver enhanced products and services with the
longstanding tradition of high touch service and community involvement."
Under the terms of the agreement, shareholders of Oregon Trail will be
entitled to receive for each share of Oregon Trail common stock either $22.00
in cash or approximately 1.028 shares of FirstBank common stock, subject to
election and allocation procedures which are intended to ensure that, in the
aggregate, 46% of the Oregon Trail shares will be exchanged for FirstBank
common stock. In the merger, FirstBank will issue 1.48 million shares of
common stock and $36.5 million in cash. Oregon Trail shareholders will have an
opportunity to choose between stock consideration of approximately 1.028
shares of FirstBank common stock or cash consideration of $22 per share. It
is anticipated that the transaction will be completed in the fourth quarter of
2003, pending regulatory approvals, the approval of the shareholders of
FirstBank and Oregon Trail and other customary conditions. This transaction is
currently valued at approximately $74.0 million. The agreement provides for
the merger of Oregon Trail Financial Corp. into FirstBank NW Corp., and the
subsequent merger of Pioneer Bank into FirstBank Northwest, FirstBank's bank
subsidiary. The transaction is intended to qualify as a tax-free
reorganization for federal income tax purposes with the result that shares of
Oregon Trail common stock that are exchanged for shares of FirstBank common
stock will be exchanged on a tax-free basis.
"We are confident that this expansion opportunity will strengthen
FirstBank's ability to fund loans in areas where we are experiencing
significant growth. FirstBank has been successful in serving the rural
marketplace and we consider Pioneer Bank and Eastern Oregon to fit well with
our existing franchise," added Mr. Conklin.
"Our board carefully considered the interests of shareholders, customers,
employees and the communities we serve and determined that FirstBank was the
ideal merger partner," said Berniel L. Maughan, President and CEO of Oregon
Trail Financial Corp. "As an organization, we have significantly improved our
performance; however, in order to enhance our future growth potential, it
was important for us to affiliate with an institution in growing markets such
as FirstBank that is committed to building on the successes we have attained,
while sharing our commitment to providing financial services to the market
place." Mr. Conklin said "The merger is expected to be accretive to earnings
in the first full year based on initial expense savings of 18%. Additionally,
as we combine and integrate our systems and support functions, future expense
savings will be realized which should continue the earnings accretion." Pre-
tax merger-related costs are estimated to be approximately $5.6 million. Upon
completion of the acquisition of Oregon Trail, on a pro forma basis using
December 31, 2002 data, FirstBank will have $687 million in total assets, $461
million in total deposits and $67 million in total shareholders' equity, with
17 branches in Eastern Oregon, Eastern Washington and Idaho.
In connection with the execution of the merger agreement, FirstBank also
entered into a standstill agreement with Joseph Stilwell and his affiliated
entities which own 9.2% of Oregon Trail's outstanding shares of common stock.
The agreement also provides that the Stilwell Group will not propose or seek
to effect a merger or sale of FirstBank, solicit proxies in opposition to
recommendations or proposals of FirstBank's management, or seek to exercise
any control or influence over the management of FirstBank and will dispose of
any FirstBank shares received in the merger as expeditiously as possible but
in no event later than six months after the closing of the merger.
FirstBank NW Corp. is the holding company for FirstBank Northwest and is
headquartered in Lewiston, Idaho. FirstBank Northwest is a Washington state
chartered savings bank serving Idaho and Eastern Washington through a network
of eight full service offices and three loan centers. At December 31, 2002,
FirstBank had assets of $325.9 million, deposits of $209.7 million and
shareholders' equity of $29.4 million.
This press release contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended, with respect to the financial
condition, results of operations and business of FirstBank NW Corp. following
the consummation of the merger that are subject to various factors which could
cause actual results to differ materially from such projections or estimates.
Such factors include, but are not limited to, the following: (1) the
businesses of FirstBank and Oregon Trail may not be combined successfully, or
such combination may take longer to accomplish than expected; (2) expected
cost savings or accretions to earnings from the merger cannot be fully
realized or realized within the expected timeframes; (3) the merger charges or
operating costs, customer loss and business disruption following the merger,
including adverse effects on relationships with employees, may be greater than
expected; (4) governmental approvals of the merger may not be obtained, or
adverse regulatory conditions may be imposed in connection with government
approvals of the merger; (5) the shareholders of FirstBank or Oregon Trail may
fail to approve the merger; (6) adverse governmental or regulatory policies
may be enacted; (7) the interest rate environment may further compress margins
and adversely affect net interest income; (8) the risks associated with
continued diversification of assets and adverse changes to credit quality; (9)
competitive pressures from other financial service companies in FirstBank's
and Oregon Trail's markets may increase significantly; and (10) the risk of an
economic slowdown, either nationally or in the markets that FirstBank does
business would adversely affect credit quality and loan originations. Other
factors that may cause actual results to differ from forward-looking
statements are described in FirstBank's filings with the Securities and
Exchange Commission.
FirstBank does not undertake, and specifically disclaims, any obligation
to publicly release the result of any revisions which may be made to any
forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such statements.
FirstBank and Oregon Trail will be filing relevant documents concerning the
transaction with the Securities and Exchange Commission, including a
registration statement on Form S-4 containing a prospectus/proxy statement.
Investors are urged to read the registration statement on Form S-4 containing
a prospectus/proxy statement regarding the proposed transaction and any other
documents filed with the SEC, as well as any amendments or supplements to
those documents, because they contain (or will contain) important information.
Investors are able to obtain those documents free of charge at the SEC's
website, (http://www.sec.gov). In addition, documents filed with the SEC by
FirstBank can be obtained, without charge, by directing a request to FirstBank
NW Corp., 920 Main Street, Lewiston, Idaho 83501, Attn: Larry K. Moxley,
Executive Vice President, telephone (208) 746-9610. In addition, documents
filed with the SEC by Oregon Trail can be obtained, without charge, by
directing a request to Oregon Trail Financial Corp., 2055 First Street, Baker
City, Oregon 97814, Attn: Zane F. Lockwood, Corporate Secretary, telephone
(541) 523-6327. WE URGE SHAREHOLDERS TO READ THESE DOCUMENTS, AS WELL AS ANY
AMENDMENTS AND SUPPLEMENTS TO THOSE DOCUMENTS BECAUSE THEY CONTAIN (OR WILL
CONTAIN) IMPORTANT INFORMATION.
FirstBank and Oregon Trail and their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies to
approve the merger. Information about the participants may be obtained through
the SEC's web site from the definitive proxy statement filed with the SEC by
FirstBank on June 14, 2002 and the definitive proxy statement filed with the
SEC by Oregon Trail on July 26, 2002. Additional information about the
interests of those participants may be obtained from reading the definitive
prospectus/proxy statement regarding the proposed transaction when it becomes
available. FIRSTBANK AND OREGON TRAIL INVESTORS SHOULD READ THE PROXY
STATEMENT/PROSPECTUS AND OTHER DOCUMENTS TO BE FILED WITH THE SEC CAREFULLY
BEFORE MAKING A DECISION CONCERNING THE MERGER.
SOURCE FirstBank NW Corp."
http://www.prnewswire.com/news-releases/firstbank-nw-corp-to-acquire-oregon-trail-financial-corp-74469647.html
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