-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IyE7OBfzaFAZDJvK3AgKzMSNpoyHFLGO70ygEmKw/Gb7PidbPVhQQyT3c6XmaHd1 QdQoLCCrMDnnzXnO4Tvfow== 0001047469-99-010373.txt : 19990319 0001047469-99-010373.hdr.sgml : 19990319 ACCESSION NUMBER: 0001047469-99-010373 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19990318 GROUP MEMBERS: BOSTON BANK OF COMMERCE GROUP MEMBERS: THE BOSTON BANK OF COMMERCE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CARVER BANCORP INC CENTRAL INDEX KEY: 0001016178 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 133904174 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D SEC ACT: SEC FILE NUMBER: 005-48913 FILM NUMBER: 99568168 BUSINESS ADDRESS: STREET 1: 75 W 125TH ST CITY: NEW YORK STATE: NY ZIP: 10027-4512 BUSINESS PHONE: 2128764747 MAIL ADDRESS: STREET 1: 75 W 125TH ST CITY: NEW YORK STATE: NY ZIP: 10027-4512 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: BOSTON BANK OF COMMERCE CENTRAL INDEX KEY: 0001082070 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 042764211 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 133 FEDERAL STREET CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6174574400 MAIL ADDRESS: STREET 1: 133 FEDERAL STREET CITY: BOSTON STATE: MA ZIP: 02110 SC 13D 1 SCHEDULE 13D SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. _) CARVER BANCORP, INC. - -------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, PAR VALUE $0.01 PER SHARE - -------------------------------------------------------------------------------- (Title of Class of Securities) 146875 10 9 - -------------------------------------------------------------------------------- (CUSIP Number) MARK L. JOHNSON, ESQ. FOLEY, HOAG & ELIOT LLP ONE POST OFFICE SQUARE BOSTON, MASSACHUSETTS 02109 (617) 832-1134 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) MARCH 8, 1999 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13(d)-1(g), check the following box / /. NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required on the remainder of the cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). (Continued on following pages) (Page 1 of 11 Pages) SCHEDULE 13D CUSIP NO. 146875 10 9 Page 2 of 11 Pages 1 NAME OF REPORTING PERSON: BBC Capital Market, Inc. I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 04-3072694 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) / / (b) / / 3 SEC USE ONLY 4 SOURCE OF FUNDS WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): / / 6 CITIZENSHIP OR PLACE OF ORGANIZATION: Massachusetts NUMBER OF 7 SOLE VOTING POWER: 161,300 SHARES BENEFICIALLY 8 SHARED VOTING POWER: OWNED BY EACH 9 SOLE DISPOSITIVE POWER: 161,300 REPORTING PERSON WITH 10 SHARED DISPOSITIVE POWER: 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 161,300 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: / / 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 6.97% 14 TYPE OF REPORTING PERSON: CO SCHEDULE 13D CUSIP NO. 146875 10 9 Page 3 of 11 Pages 1 NAME OF REPORTING PERSON: The Boston Bank of Commerce I.R.S. IDENTIFICATION NO. OF ABOVE PERSON: 04-2764211 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) / / (b) / / 3 SEC USE ONLY 4 SOURCE OF FUNDS WC 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): / / 6 CITIZENSHIP OR PLACE OF ORGANIZATION: Massachusetts NUMBER OF 7 SOLE VOTING POWER: 161,300 SHARES BENEFICIALLY 8 SHARED VOTING POWER: OWNED BY EACH 9 SOLE DISPOSITIVE POWER: 161,300 REPORTING PERSON WITH 10 SHARED DISPOSITIVE POWER: 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON: 161,300 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: / / 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 6.97% 14 TYPE OF REPORTING PERSON: BK Page 4 of 11 Pages This Statement on Schedule 13D (this "Statement") is filed with the Securities and Exchange Commission pursuant to Rule 13d-1 under the Securities Exchange Act of 1934 (the "Act"). Item 1. Security and Issuer. This Statement relates to the common stock, par value $.01 per share ("Common Stock"), of Carver Bancorp, Inc. ("Carver"). Carver is a Delaware corporation with its principal executive offices located at 75 West 125th Street, New York, New York 10027-4512. Item 2. Identity and Background. (a) This Statement is being filed by The Boston Bank of Commerce, a Massachusetts trust company ("BBOC"), and BBC Capital Market, Inc., a Massachusetts corporation and wholly owned subsidiary of BBOC ("BBC Capital" and, together with BBOC, the "Filing Persons"). Kevin Cohee ("Cohee"), the Chairman, President and Chief Executive Officer of BBOC, and Teri Williams ("Williams"), the Senior Vice President-Marketing/Human Resources of BBOC and the spouse of Cohee, own as joint tenants 66.6% of the outstanding common stock of BBOC. Cohee and Williams have delivered to BBOC and BBC Capital a written statement to the effect that they disclaim any beneficial ownership of the shares of Common Stock covered by this Statement. (b) The address of the principal business of each of the Filing Persons is 133 Federal Street, Boston, Massachusetts 02110. (c) The principal business of BBOC is commercial banking. BBOC is incorporated as a trust company under Chapter 172 of the Massachusetts General Laws. Deposits at BBOC are insured by The Federal Deposit Insurance Corporation. Set forth in Schedule A hereto is the name, citizenship, business or residence address, and present principal occupation or employment, as well as the name and address of any corporation or other organization in which such occupation or employment is conducted, of each of the directors and executive officers of BBOC, as of the date hereof. BBC Capital is operated solely for the purpose of holding securities on behalf of BBOC. Set forth in Schedule B hereto is the name, citizenship, business or residence address, and present principal occupation or employment, as well as the name and address of any corporation or other organization in which such occupation or employment is conducted, of each of the directors and executive officers of BBC Capital, as of the date hereof. (d) During the last five years, neither of the Filing Persons nor, to the knowledge of the Filing Persons, any person named in either Schedule A or Schedule B hereto has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Page 5 of 11 Pages (e) During the last five years, neither of the Filing Persons nor, to the knowledge of the Filing Persons, any person named in either Schedule A or Schedule B hereto was a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree, or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Item 3. Source and Amount of Funds or Other Consideration. BBOC has paid approximately $1,349,621 to purchase the shares of Common Stock covered by this Statement. BBOC used funds from its operations, and from no other source, for these purchases. BBOC has contributed all of the shares of Common Stock covered by this Statement to BBC Capital. Item 4. Purpose of the Transaction. By acquiring shares of Common Stock, BBOC and BBC Capital seek to strengthen two important African-American financial institutions, Carver Federal Savings Bank and BBOC. African-American financial institutions are an important cornerstone for economic development in urban markets. Enhancing the capability of these institutions to deliver products and services to their constituent communities is a requisite component for their continued success into the twenty-first century. Recent Carver press releases citing $10 million of non-performing loans and a $500,000 increase in deposit insurance premiums have signaled a substantial decline in Carver's safety and soundness. Carver's high levels of overhead costs, non-earning assets and loan loss provisions have resulted in poor earnings. With recent management terminations, Carver's board of directors has implicitly acknowledged that its management lacked the skills necessary to cope with the complexities of its financial and operational challenges. Carver's current situation parallels BBOC's past. Three years ago, BBOC's new management team faced a cease and desist regulatory order, poor asset quality, high overhead costs, and a $3.6 million operating loss. This management team has been responsible for bringing BBOC into a strong and stable condition. Management has achieved a fourfold increase in capital, a 79% increase in assets and a $4.3 million improvement in earnings, all while maintaining an outstanding CRA rating. As the only African-American owned bank in New England, BBOC has become a model for community development. In a letter dated March 1, 1999 (a copy of which is included as Exhibit 1 to this Statement), BBOC proposed that Carver consider a transaction in which all of the outstanding capital stock of BBOC would be converted into Common Stock. BBOC and Carver Federal Savings Bank each would continue to exist, operating under Carver. The current management of BBOC would become the principal executive officers of Carver and its subsidiaries. BBOC and BBC Capital believe that this transaction would resolve the management and operating challenges that currently face Carver. The benefits to Carver and its shareholders would include: -- an experienced chief executive officer and management team, -- an increase of $106 million (25%) in total assets, Page 6 of 11 Pages -- an increase of more than $1 million in earnings, -- an increase of $9 million in capital, -- an improved market valuation and perception, and -- an entrance into a new banking market. The combination of Carver and BBOC would create the nation's first and only interstate African-American financial institution, one that is well positioned to offer enhanced products and services to African-American communities in both New York and Boston. The resulting entity would be a leader for community development and social and political empowerment of African-Americans. In a letter dated March 9, 1999 from Carver to BBOC, Carver indicated that its board of directors had rejected the proposed transaction, preferring instead to focus only on the hiring of a new chief executive officer. BBOC and BBC Capital believe a narrow focus on the hiring of a single officer is not in the best interests of the shareholders of Carver. BBOC intends to advocate for the proposed transaction. BBOC has applied for regulatory approvals necessary for BBC Capital to continue to hold the shares of Common Stock covered by this Statement. BBOC and BBC Capital may seek to acquire additional shares of Common Stock in a number that, combined with the shares covered by this Statement, would represent up to 9.9% of the outstanding Common Stock. BBOC and BBC Capital would be required to obtain further regulatory approvals before their holdings could exceed 9.9% of the outstanding Common Stock. In addition, provisions of Carver's charter purport to limit the extent to which a person may acquire or vote holdings in excess of 10% of the Common Stock. Item 5. Interest in Securities of the Issuer. The information contained in Item 4 of this Statement is incorporated herein by reference. BBC Capital is the record holder of 161,300 shares of Common Stock, representing approximately 6.97% of the outstanding Common Stock. Those shares may be deemed to be beneficially owned by BBC Capital and BBOC, as the result of BBOC's ownership of all of the outstanding stock of BBC Capital. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. The information contained in Item 4 of this Statement is incorporated herein by reference. Except as described in Item 4, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between the Filing Persons, or between either of the Filing Persons and any other person, with respect to any securities of Carver. Page 7 of 11 Pages Item 7. Material to be Filed as Exhibits. Exhibit 1. Letter dated March 1, 1999 of The Boston Bank of Commerce to Pazel G. Jackson, Jr., as a Director of Carver Bancorp, Inc. After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. March 18, 1999 BBC CAPITAL MARKET, INC. By: /s/ Kevin Cohee ----------------------------------------------- Kevin Cohee President THE BOSTON BANK OF COMMERCE By: /s/ Kevin Cohee ----------------------------------------------- Kevin Cohee Chairman, President and Chief Executive Officer Page 8 of 11 Pages SCHEDULE A Executive Officers and Directors of The Boston Bank of Commerce ------------------------------ The names of the Directors and the names and titles of the Executive Officers of The Boston Bank of Commerce and their business addresses and principal occupations are set forth below. Unless otherwise indicated, each individual is a United States citizen.
Principal Occupation Name, Title and Citizenship and Business Address --------------------------- -------------------- Kevin Cohee President, Chairman and CEO Director & Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 Dr. Richard D. Carr Partner Director Carr, Enos & Associates 66 New Edgerly Road Boston, Massachusetts 02115 Daniel Dennis Partner Director Daniel Dennis & Company 116 Huntington Avenue Boston, Massachusetts 02115 Dr. Kenneth Edelin Executive Director Director Boston University School of Medicine 715 Albany Street Boston, Massachusetts 02118 Syvalia Hyman, III President Director United South End Lower Roxbury Development Corporation 434 Massachusetts Avenue Boston, Massachusetts 02118
Page 9 of 11 Pages Yu Sing Jung Partner Director Jung/Brannen Associates 177 Milk Street Boston, Massachusetts 02109 Melvin B. Miller Publisher Director BayState Banner 68 Fargo Street Boston, Massachusetts 02210 Walter B. Prince Partner Director Peckham, Lobel, Casey, Prince & Tye 585 Commercial Street Boston, Massachusetts 02109 John L. Sims Private Consultant Director 9 Emerson Way Sudbury, Massachusetts 01776 Teri Williams Senior Vice President Director & Executive Officer Marketing/Human Resources The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 Michael P. Burley Senior Vice President and Treasurer Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 Robert Patrick Cooper Senior Counsel Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 James Mundy Senior Vice President and Executive Officer Chief Financial Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 Joanne Pizzigno Vice President-Lending Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110
Page 10 of 11 Pages SCHEDULE B Executive Officers and Directors of BBC Capital Markets, Inc. ---------------------------- The names of the Directors and the names and titles of the Executive Officers of BBC Capital Market, Inc. and their business addresses and principal occupations are set forth below. Unless otherwise indicated, each individual is a United States citizen.
Principal Occupation Name, Title and Citizenship and Business Address --------------------------- -------------------- Kevin Cohee President, Chairman and CEO Director & Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 John L. Sims Private Consultant Director 9 Emerson Way Sudbury, Massachusetts 01776 Teri Williams Senior Vice President Director Marketing/Human Resources The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02110 Michael P. Burley Senior Vice President and Treasurer Director & Executive Officer The Boston Bank of Commerce 133 Federal Street Boston, Massachusetts 02109
Page 11 of 11 Pages EXHIBIT INDEX -------------
Exhibit No. Document - ----------- -------- 1 Letter dated March 1, 1999 of The Boston Bank of Commerce to Pazel G. Jackson, Jr., as a Director of Carver Bancorp, Inc.
EX-1 2 EXHIBIT 1 EXHIBIT 1 March 1, 1999 Mr. Pazel G. Jackson, Jr. Senior Vice President Chase Manhattan Bank Community Development Group 600 5th Avenue, 3rd Floor New York, NY 10020 Dear Pazel: This letter outlines the proposal that Boston Bank of Commere ("BBOC") made to Carver Bancorp, Inc. ("Carver" or "Bank") on February 19, 1999. It is our understanding that Carver's Board of Directors will formally consider the proposal sometime this week. We believe this letter will help in making your decision. THE TRANSACTION BBOC proposes that Carver acquire BBOC in a stock transaction whereby Carver would issue common stock to BBOC shareholders for 100% of the outstanding shares of BBOC. Carver Bancorp would then own Carver Federal Savings Bank in New York and Boston Bank of Commerce in Massachusetts. TERMS BBOC SHARE PRICE The BBOC shares would be valued at 1.5 times the per share book value of BBOC. CARVER SHARE PRICE The Carver shares would be valued at the market price of the stock as of an agreed upon date. An investment banking firm would be retained by Carver to provide a fairness opinion on the transaction. DIRECTORS' COMPENSATION At the Closing, each of Carver's outside Directors would receive $250,000 in cash. The Directors would agree to discontinue their existing compensation package including Carver's Directors Retirement Plan, Option and Management Recognition Plan. Carver Proposal Letter March 1, 1999 Page 2 COMPANY'S HEADQUARTERS The resulting institution would be headquartered in New York City. MANAGEMENT BBOC's management team along with selected members of Carver's management team would operate the resulting institution. Kevin Cohee would be the CEO and would be based in New York City. The resulting institution would make every effort to utilize existing Carver employees to the extent possible. STRATEGIC PLAN The resulting institution would be managed as a Community Development Financial Institution. Its mission wold be to continue to serve Carver's traditional markets and to expand its reach to other urban communities. More details related to the strategic plan are enclosed. SHAREHOLDER AND REGULATORY APPROVALS This proposal is conditioned upon approval by the Office of Thrift Supervision, the Federal Deposit Insurance Corporation, the Federal Reserve Bank, state banking regulators in Massachusetts and New York, and such approvals of the stockholders of Carver and BBOC as is required by law. TRANSACTION BACKGROUND As a Director, you understand that Carver is a troubled institution despite recent efforts to clean up the Bank. The Bank's history of poor earnings and recent announcements of poor asset quality and management changes have undermined Carver's reputation in the community and the confidence of investors and regulators. Recent press releases citing $10 million of non-performing loans and a $500,000 increase in deposit insurance premiums signal a substantial downgrade in Carver's safety and soundness. Further, Carver's excessive overhead costs, high levels of non-earning assets and potential requirements for additional reserves compromise future earnings. With the recent management terminations, the Board acknowledges the Bank's current management does not have the level of skills necessary to cope with the complexities of its financial and operational challenges. Carver's current situation parallels BBOC's recent history. Three years ago, BBOC's new management team faced a cease and desist regulatory order, poor asset quality, high overhead costs, and a $3.6 million operating loss. Since 1996, this BBOC management team has turned the Bank around, achieving a four fold increase in capital, a 79.25% increase in assets and a $4.3 million improvement in earnings. This was accomplished while maintaining an outstanding CRA rating. The team's accomplishments are detailed in the enclosed document. As the only African-American owned bank in New England, BBOC has become a model for community development. Carver Proposal Letter March 1, 1999 Page 3 CARVER MAKING HISTORY Carver is at a crossroads and its future is in your hands. As a Director of Carver, you have the opportunity to make history. The combination of Carver and BBOC will create the nation's first and only interstate African-American financial institution, one that is positioned to expand its market reach to other large urban centers. As the leader for community development, social and political empowerment of African-Americans, Carver will finally realize its full potential as it moves into the new millennium. If you proceed on your current course and simply hire a CEO, you will not provide the Bank with the resources needed to prosper and will risk repeating the failures of the past four years. A troubled institution needs much more than a CEO. It needs a full team that can manage the multiple challenges facing the institution. Carver's shareholders have been waiting for years for improved operating results and will have no patience for long term plans for improving profits. A merger with BBOC will bring a resolution to the challenges facing Carver. The benefits to Carver and its shareholders include: - an experienced CEO and management team - a $105 million increase in assets or 25% asset growth - an over $1 million increase in earnings - a $8 million increase in capital - an improved market valuation and perception - an entree into a new market The enclosed document is a presentation given to your Chairman David R. Jones and to Pazel G. Jackson, Jr. It provides more background information. BBOC would like to make a full presentation to the entire Carver Board of Directors as soon as possible. Please let us know the earliest available date. Sincerely, Kevin Cohee Chairman & CEO KLC/hke -----END PRIVACY-ENHANCED MESSAGE-----