ELMIRA SAV BK November 9, 2021
MERGER PROPOSED - YOUR VOTE IS VERY IMPORTANT
Dear Shareholder:
You are cordially invited to attend a special meeting of Shareholders of Elmira Savings Bank (the "Bank"), which will be held at The Clemens Center, 207 Clemens Center Parkway, Elmira, NY 14901, at 10:00 a.m. on December 14, 2021.
On October 3, 2021, the Bank entered into an Agreement and Plan of Merger (the "Merger Agreement") with Community Bank, N.A. ("Community"), the wholly-owned banking subsidiary of Community Bank System, Inc., and Eagle Merger Sub Inc. ("Merger Sub"), a newly formed subsidiary of Community, pursuant to which the Bank will merge with and into Merger Sub, with the Bank as the surviving corporation (the "Merger"). If the Merger is completed, at the closing you will receive $23.10 in cash for each share of common stock of the Bank that you own. Upon completion of the Merger, you will no longer own any stock or have any other interest in the Bank.
At the special meeting, you will be asked to vote on the following matters: (1) a proposal to approve the Merger Agreement (the "Merger Proposal"); (2) a non-binding, advisory proposal regarding the compensation to be paid to the named executive officers of the Bank in connection with the transactions contemplated by the Merger Agreement (the "Merger-Related Compensation Proposal"); and (3) a proposal to adjourn or postpone the special meeting, if deemed necessary or appropriate, to solicit additional proxies if there are not sufficient votes represented in person or by proxy at the time of the special meeting to approve the Merger Agreement (the "Adjournment Proposal"). Shareholders holding at least two-thirds of the outstanding shares of the common stock of the Bank must vote in favor of the Merger Proposal for the Merger to be completed. If the Merger Agreement is approved, and all other conditions described in the Merger Agreement have been met or waived, the Merger is expected to close during the first quarter of 2022.
The Bank's Board of Directors unanimously recommends that you vote "FOR" the Merger Proposal, "FOR" the Merger-Related Compensation Proposal, and "FOR" the Adjournment Proposal.
This proxy statement provides you with detailed information about the proposed Merger and includes, as Appendix A, a copy of the Merger Agreement. We urge you to read the enclosed materials carefully for a complete description of the Merger.
Your vote is important. While we have concerns relating to COVID-19 (otherwise known as the "coronavirus") and public gatherings, we still plan to convene the special meeting in person. We will conduct the special meeting with those concerns in mind and take the necessary precautions, including sanitizing and social distancing measures. Despite these precautionary
measures, we are encouraging shareholders not to attend the special meeting in person. We are asking that shareholders vote by proxy rather than in person at the special meeting. On behalf of the Board of Directors, we urge you to sign, date, and return the enclosed proxy card as soon as possible. In the event that the time or place of the meeting changes due to updated state or local guidelines for public gatherings due to the COVID-19 pandemic, we will release the new special meeting location information via a press release. If your shares are held in an account at a bank, broker or other nominee, you should instruct your bank, broker or nominee how to vote your shares using the separate voting instruction form furnished by your bank, broker or nominee.
If you have any questions, please call Shareholder Relations of the Bank at (607) 735-8660.
On behalf of the Board of Directors, we thank you for your prompt attention to this important matter.
Sincerely,
ELMIRA SAVINGS BANK
Thomas M. Carr
President & Chief Executive Officer
This proxy statement is dated November 9, 2021 and is first being mailed to shareholders on or about November 12, 2021.
ELMIRA SAVINGS BANK
333 East Water Street
Elmira, NY 14901
-
734-3374
____________________
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
To be held December 14, 2021
_____________________
To our Shareholders:
Notice is hereby given that the special meeting of Shareholders of Elmira Savings Bank (the "Bank") will be held at The Clemens Center, 207 Clemens Center Parkway, Elmira, NY 14901, at 10:00 a.m. local time, on December 14, 2021, and thereafter as it may from time to time be adjourned.
The special meeting is being held:
-
To consider and vote upon a proposal to approve the Agreement and Plan of Merger, dated as of October
3, 2021 by and among the Bank, Community Bank, N.A. ("Community"), and Eagle Merger Sub Inc., pursuant to which the Bank will be acquired by Community (the "Merger"), as more fully described in the accompanying proxy statement (the "Merger Proposal"); - To consider and vote upon an advisory (non-binding) proposal to approve certain compensation that may be paid or become payable to the Bank's named executive officers that is based on or otherwise relates to the Merger (the "Merger-Related Compensation Proposal"); and
- To consider and vote upon a proposal to approve the adjournment or postponement of the special meeting if necessary or appropriate to solicit additional proxies in favor of the proposal to approve the Merger Proposal if there are insufficient votes at the time of the special meeting to approve the Merger Proposal
(the "Adjournment Proposal").
We are not aware of any other business to come before the special meeting. Any action may be taken on Proposals No. 1, 2 and 3 at the special meeting or on any date or dates to which the special meeting may be adjourned or postponed. Shareholders of record at the close of business on November 9, 2021 are entitled to notice of, and to vote at, the special meeting and any adjournments or postponements thereof.
Shareholders of the Bank may exercise appraisal rights and dissent from the transactions contemplated by the Merger Agreement and, instead, obtain payment in cash of the appraised fair value of their shares of the Bank's common stock as determined under the Consolidated Laws of New York, Banking Law (the "NY Banking Law"). In order for a shareholder of the Bank to perfect such holder's appraisal rights, the shareholder must carefully follow the procedures set forth under Sections 604 and 6022 of the NY Banking Law. The full text of Sections 604 and 6022 of the NY Banking Law is included as Appendix C, and a summary of these provisions can be found under the caption "PROPOSAL 1 - APPROVAL OF THE MERGER AGREEMENT - Appraisal or Dissenters' Rights."
By order of the Board of Directors,
John R. Alexander
Secretary
Elmira, New York
November 9, 2021
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. PLEASE SIGN, DATE AND COMPLETE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED POSTAGE PAID ENVELOPE AS SOON AS POSSIBLE WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF EACH OF THE PROPOSALS.
TABLE OF CONTENTS | |
QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETING | ..... 1 |
SUMMARY.................................................................................................................................... | 4 |
The Special Meeting.................................................................................................................... | 4 |
The Merger .................................................................................................................................. | 5 |
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION | ..... 9 |
THE SPECIAL MEETING........................................................................................................... | 10 |
Date, Time and Place of the Special Meeting ........................................................................... | 10 |
Actions to be Taken at the Special Meeting .............................................................................. | 10 |
Quorum ..................................................................................................................................... | 10 |
Record Date; Outstanding Shares; Shares Entitled to Vote....................................................... | 10 |
Vote Required to Approve Each Proposal................................................................................... | 10 |
How to Vote Shares Held Directly by the Shareholder .............................................................. | 11 |
How to Vote Shares Held by a Broker, Bank or Other Nominee ............................................... | 11 |
Effect of Broker Non-Votes and Abstentions ............................................................................ | 11 |
How Will Shares be Voted ........................................................................................................ | 11 |
Revocation of Proxies................................................................................................................ | 11 |
Proxy Solicitation...................................................................................................................... | 12 |
Share Ownership of Bank Management; Voting Agreement .................................................... | 12 |
Recommendation of the Elmira Savings Bank Board of Directors .......................................... | 12 |
INFORMATION ABOUT THE COMPANIES ........................................................................... | 13 |
Elmira Savings Bank................................................................................................................. | 13 |
Community Bank, N.A. ............................................................................................................ | 13 |
PROPOSAL 1-APPROVAL OF THE MERGER AGREEMENT............................................ | 15 |
Terms of the Merger.................................................................................................................. | 15 |
Background of the Merger ........................................................................................................ | 15 |
Recommendation of the Bank's Board of Directors .................................................................. | 17 |
The Bank's Reasons for the Merger ......................................................................................... | 18 |
Opinion of the Bank's Financial Advisor.................................................................................. | 19 |
Surrender of Shares; Payment of Merger Consideration ......................................................... | 28 |
Effect on the Bank and our Shareholders if the Merger is not Completed ............................... | 29 |
Appraisal or Dissenters' Rights ................................................................................................ | 29 |
INTERESTS OF THE BANK'S DIRECTORS AND EXECUTIVE OFFICERS IN THE | |
MERGER ...................................................................................................................................... | 32 |
Stock Options ............................................................................................................................ | 32 |
Restricted Stock ........................................................................................................................ | 32 |
Change in Control Agreements................................................................................................. | 32 |
Deferred Compensation Plans................................................................................................... | 32 |
Key Man Life Insurance ........................................................................................................... | 33 |
Indemnification ......................................................................................................................... | 33 |
Directors' and Officers' Insurance............................................................................................ | 33 |
Potential Payments and Benefits to the Bank's Named Executive Officers in Connection with | |
the Merger ................................................................................................................................. | 33 |
THE MERGER AGREEMENT ................................................................................................... | 35 |
Structure of the Merger ............................................................................................................. | 35 |
Closing and Effective Time of the Merger ............................................................................... | 35 |
Merger Consideration ............................................................................................................... | 35 |
Procedure for Converting Shares of Common Stock into Merger Consideration .................... | 35 |
Treatment of Bank Equity Awards ........................................................................................... | 36 |
Conduct of Business Pending the Merger................................................................................. | 36 |
Regulatory Approvals Required for the Merger ....................................................................... | 40 |
Employee Matters...................................................................................................................... | 41 |
Indemnification and Directors' and Officers' Insurance ......................................................... | 41 |
Limitations on Considering Other Acquisition Proposals ....................................................... | 42 |
Representations and Warranties................................................................................................ | 44 |
Conditions to Completion of the Merger................................................................................... | 46 |
Termination ............................................................................................................................... | 47 |
Termination Fee ........................................................................................................................ | 48 |
Expenses.................................................................................................................................... | 48 |
Amendment; Waiver ................................................................................................................. | 48 |
MATERIAL FEDERAL INCOME TAX CONSEQUENCES .................................................... | 49 |
SECURITY OWNERSHIP OF THE BANK'S BENEFICIAL OWNERS AND | |
MANAGEMENT AND RELATED SHAREHOLDER MATTERS........................................... | 51 |
PROPOSAL 2-MERGER-RELATED NAMED EXECUTIVE OFFICER COMPENSATION | |
....................................................................................................................................................... | 53 |
PROPOSAL 3-ADJOURNMENT OF THE SPECIAL MEETING .......................................... | 54 |
SHAREHOLDER PROPOSALS ................................................................................................. | 55 |
WHERE YOU CAN FIND MORE INFORMATION ................................................................. | 55 |
APPENDIX A - Agreement and Plan of Merger ....................................................................... | A-1 |
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Disclaimer
Elmira Savings Bank published this content on 10 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 November 2021 18:09:01 UTC.
