form8-k.htm
UNITED
STATES
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): September 16,
2009
PATHFINDER
BANCORP, INC.
(Exact
name of Registrant as specified in its charter)
Commission File
Number
000-23601
Federal
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16-1540137
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(State
or Other Jurisdiction of
Incorporation
or Organization)
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(I.R.S.
Employer Identification Number)
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214 West First Street,
Oswego, NY 13126
(Address
of Principal Executive Office) (Zip Code)
(315)
343-0057
(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:
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
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Item
1.01. Entry into a Material
Definitive Agreement
On September 11, 2009, Pathfinder
Bancorp, Inc. (the “Company”), the holding company of Pathfinder Bank, entered
into a Letter Agreement (the “Purchase Agreement”), with the United States
Department of the Treasury (“Treasury Department”) pursuant to which the Company
has issued and sold to Treasury: (i) 6,771 shares of the Company’s Fixed
Rate Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per
share (the “Series A Preferred Stock”), having a liquidation amount per
share equal to $1,000, for a total price of $6,771,000; and (ii) a Warrant (the
“Warrant”) to purchase 154,354 shares of the Company’s common stock, par value
$0.01 per share (the “Common Stock”), at an exercise price per share of
$6.58. The Company intends to contribute to Pathfinder Bank, its
subsidiary, 81.23% of the proceeds of the sale of the Series A Preferred Stock.
The Purchase Agreement is attached as Exhibit 10.12 hereto and is
incorporated herein by reference.
The Series A Preferred Stock pays
cumulative dividends at a rate of 5% per annum for the first five years and
thereafter at a rate of 9% per annum. The Series A
Preferred Stock is generally non-voting. Prior to September 11, 2012,
and unless the Company has redeemed all of the Series A Preferred Stock or
the Treasury Department has transferred all of the Series A Preferred Stock
to a third party, the approval of the Treasury Department will be required for
the Company to increase its common stock dividend or repurchase its common stock
or other equity or capital securities, other than in certain circumstances
specified in the Purchase Agreement.
The Warrant has a ten year term and is
immediately exercisable. The Warrant provides for the adjustment of
the exercise price and the number of shares of the Company’s common stock
issuable upon exercise pursuant to customary anti-dilution provisions, such as
upon stock splits or distributions of securities or other assets to holders of
the Company’s common stock, and upon certain issuances of the Company’s common
stock at or below a specified price relative to the then current market price of
the Company’s common stock. If, on or prior to December 31,
2009, the Company receives aggregate gross cash proceeds of not less than the
purchase price of the Series A Preferred Stock from one or more “qualified
equity offerings,” the number of shares of common stock issuable pursuant to the
Warrant will be reduced by one-half of the original number of shares, taking
into account all adjustments. Pursuant to the Purchase Agreement, the
Treasury Department has agreed not to exercise voting power with respect to any
shares of common stock issued upon exercise of the Warrant. The
Warrant is attached as Exhibit 4.2 hereto and is incorporated herein by
reference.
The Series A Preferred Stock and
the Warrant were issued in a private placement exempt from registration pursuant
to Section 4(2) of the Securities Act of 1933, as amended. The
Company has agreed to register for resale the Series A Preferred Stock, the
Warrant and the shares of common stock underlying the Warrant (the “Warrant
Shares”), as soon as practicable after the date of the issuance of the
Series A Preferred Stock and the Warrant. Neither the
Series A Preferred Stock nor the Warrant will be subject to any contractual
restrictions on transfer, except that the Treasury Department may only transfer
or exercise an aggregate of one-half of the Warrant Shares prior to the earlier
of the date on which the Company receives aggregate gross cash proceeds of not
less than the purchase price of the Series A Preferred Stock from one or
more “qualified equity offerings” and December 31, 2009.
Pursuant to the Purchase Agreement, the
closing was subject to each of the Company’s Senior Executive Officers, as
defined in subsection 111(b)(3) of the Emergency Economic Stabilization Act of
2008 (the “EESA”) and regulations issued thereunder, delivering to Treasury a
written waiver voluntarily, effective September 11, 2009, waiving any claim
against Treasury or the Company for any changes to such Senior Executive
Officer’s compensation or benefits that are required to comply with the
regulation issued by Treasury under the Troubled Assets Relief Program (“TARP”)
Capital Purchase Program as published in the Federal Register on
October 20, 2008 as amended by the American Recovery and Reinvestment Act
of 2009 and acknowledging that the regulation may require modification of the
compensation, bonus, incentive and other benefit plans, arrangements and
policies and agreements (including so-called “golden parachute” agreements)
(collectively, “Benefit Plans”) as they relate to the period Treasury holds any
equity or debt securities of the Company acquired through the TARP Capital
Purchase Program.
The closing also was subject to the
Company effecting changes to its Benefit Plans with respect to its Senior
Executive Officers as may be necessary, during the period that Treasury owns any
debt or equity securities of the Company acquired pursuant to the Purchase
Agreement, to comply with Section 111 of the EESA as implemented by
any guidance or regulation under the EESA that has been issued and is in effect
as of the closing date. The Purchase Agreement required the written
consent of those Senior Executive Officers to the extent necessary for the
changes to be legally enforceable. The amendments effecting such changes
and related consent were effective September 11, 2009.
In the Purchase Agreement, the Company
agreed that, until such time as Treasury ceases to own any debt or equity
securities of the Company acquired pursuant to the Purchase Agreement, the
Company will take all necessary action to ensure that its Benefit Plans
with respect to its Senior Executive Officers comply with
Section 111(b) of the EESA as implemented by any guidance or
regulation under the EESA that has been issued and is in effect as of the
closing date, and has agreed to not adopt any Benefit Plans with respect to, or
which cover, its Senior Executive Officers that do not comply with the
EESA.
Item 3.02. Unregistered
sales of equity securities
The information set forth under
“Item 1.01 Entry into a Material Definitive Agreement” is incorporated
herein by reference.
Item 3.03. Material
modification to rights of securityholders.
Prior to September 11, 2012, unless the
Company has redeemed the Series A Preferred Stock or the Treasury
Department has transferred the Series A Preferred Stock to a third party,
the consent of the Treasury Department will be required for the Company to
(1) declare or pay any dividend or make any distribution on its common
stock (other than regular quarterly cash dividends of not more than
$0.03 per share of common stock) or (2) redeem, purchase or acquire
any shares of its common stock or other equity or capital securities, other than
in connection with benefit plans consistent with past practice and certain other
circumstances specified in the Purchase Agreement.
In addition, under the Purchase
Agreement, the Company’s ability to declare or pay dividends or repurchase its
common stock or other equity or capital securities will be subject to
restrictions in the event that it fails to declare and pay (or set aside for
payment) full dividends on the Series A Preferred Stock.
Item
5.02.
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Departure of directors
or certain officers; election of directors; appointment of certain
officers; compensation arrangements of certain
officers.
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The information concerning executive
compensation set forth under “Item 1.01 Entry into a Material Definitive
Agreement” is incorporated by reference into this Item 5.02.
Item 5.03. Amendment
to articles of incorporation or bylaws; change in fiscal
year
On September 4, 2009, the Company filed
with the Office of Thrift Supervision, a Certificate of Designations to its
Charter establishing the terms of the Series A Preferred
Stock. This Certificate of Designations is attached as
Exhibit 4.1 hereto and is incorporated herein by reference.
Item
9.01. Financial Statements and
Exhibits
(a)
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Financial
Statements of Businesses Acquired. Not
applicable.
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(b)
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Pro
Forma Financial Information. Not
applicable.
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(c)
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Shell
Company Transactions. Not
applicable.
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(d) Exhibits.
4.1
Certificate of Designations for the Series A Preferred Stock
4.2
Warrant to Purchase Common Stock
10.12
Letter Agreement, dated September 11, 2009, betweenPathfinder Bancorp, Inc. and
the United StatesDepartment of the Treasury, which includes the Securities
Purchase Agreement-Standard Terms attached thereto, with respect to the issuance
and sale of the Series A Preferred Stock and the Warrant
SIGNATURES
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, hereunto duly
authorized.
Pathfinder Bancorp, Inc.
DATE: September
16,
2009 By: /s/: James A.
Dowd
James A.
Dowd,
Senior Vice President and
Chief
Financial Officer