-----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, A1y5PqQ+JJBeLqNnQdKcRrKveGhWiDmrA5cFfhfsxh1FTRtMDjc7EA1ur8zTUafO zMq1M3yjEsP6TM0kwpRd2w== 0000943374-04-000889.txt : 20040927 0000943374-04-000889.hdr.sgml : 20040927 20040927152740 ACCESSION NUMBER: 0000943374-04-000889 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20040714 ITEM INFORMATION: Completion of Acquisition or Disposition of Assets ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20040927 DATE AS OF CHANGE: 20040927 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROVIDENT FINANCIAL SERVICES INC CENTRAL INDEX KEY: 0001178970 STANDARD INDUSTRIAL CLASSIFICATION: SAVINGS INSTITUTION, FEDERALLY CHARTERED [6035] IRS NUMBER: 421547151 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-31566 FILM NUMBER: 041047194 BUSINESS ADDRESS: STREET 1: 830 BERGEN AVENUE CITY: JERSEY CITY STATE: NJ ZIP: 07306 BUSINESS PHONE: 2013331000 8-K/A 1 form8kamend-092304.txt AMENDED FORM 8K FOR JULY 14, 2004 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K/A CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): July 14, 2004 ------------- PROVIDENT FINANCIAL SERVICES, INC. ---------------------------------- (Exact Name of Registrant as Specified in its Charter) Delaware 001-31566 42-1547151 - ----------------------------- --------------------- ------------------- (State or Other Jurisdiction) (Commission File No.) (I.R.S. Employer of Incorporation) Identification No.) 830 Bergen Avenue, Jersey City, New Jersey 07306-4599 - ------------------------------------------ ---------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (201) 333-1000 -------------- 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 (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.01 Completion of Acquisition or Disposition of Assets -------------------------------------------------- On July 14, 2004, the merger of First Sentinel Bancorp, Inc. ("First Sentinel") with and into Provident Financial Services, Inc. ("Provident"), as contemplated by the Agreement and Plan of Merger dated as of December 19, 2003 by and between Provident and First Sentinel, was completed through the exchange of 60% of First Sentinel common stock for Provident common stock at an exchange rate of 1.092 per share and the conversion of 40% of First Sentinel common stock into cash at a rate of $22.25 per share. The aggregate consideration paid in the merger consisted of $251.9 million in cash and 18,540,662 shares of Provident common stock. The transaction was accounted for using the purchase method of accounting. This current report on Form 8-K/A is being filed to amend the initial current report on Form 8-K filed with the Securities and Exchange Commission by Provident on July 16, 2004. The initial report is being amended to include the interim and pro forma financial information required by Item 9.01(a) and (b) of Form 8-K. Item 9.01. Financial Statements and Exhibits --------------------------------- (a) Financial statements of business acquired. (i) The Audited Consolidated Statements of Financial Condition at December 31, 2003 and 2002 and the Audited Consolidated Statements of Income for the years ended December 31, 2003, 2002 and 2001 of First Sentinel are incorporated herein by reference by Exhibit 99.1. (ii) The Unaudited Consolidated Statements of Financial Condition at June 30, 2004 and the Unaudited Consolidated Statements of Income for the six months ended June 30, 2004 of First Sentinel are included in Exhibit 99.2. (b) Pro forma financial information. (i) The Unaudited Combined Condensed Consolidated Pro Forma Financial Data at and for the six months ended June 30, 2004 and for the year ended December 31, 2003 are attached hereto as Exhibit 99.2. (c) Exhibits. Exhibit No. Description ----------- ----------- 23.1 Consent of KPMG LLP 99.1 Financial Statements of First Sentinel (incorporated by reference to First Sentinel Bancorp, Inc.'s Annual Report on Form 10-K/A filed with the Securities and Exchange Commission on March 26, 2004). 99.2 Unaudited Combined Condensed Consolidated Pro Forma Financial Data at and for the six months ended June 30, 2004 and for the year ended December 31, 2003. 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. PROVIDENT FINANCIAL SERVICES, INC. DATE: September 24, 2004 By: /s/ Paul M. Pantozzi ---------------------------------------- Paul M. Pantozzi Chairman and Chief Executive Officer EXHIBIT INDEX Exhibit Description - ------- ----------- 23.1 Consent of KPMG LLP 99.1 Financial Statements of First Sentinel (incorporated by reference to First Sentinel Bancorp, Inc.'s Annual Report on Form 10-K/A filed with the Securities and Exchange Commission on March 26, 2004). 99.2 Unaudited Combined Condensed Consolidated Pro Forma Financial Data at and for the six months ended June 30, 2004 and for the year ended December 31, 2003. EX-23.1 2 form8kamend_ex231-092304.txt KPMG CONSENT EXHIBIT 23.1 Consent of Independent Registered Public Accounting Firm -------------------------------------------------------- The Board of Directors First Sentinel Bancorp, Inc.: We consent to the use of our report dated February 6, 2004, incorporated by reference in the Current Report on Form 8-K/A of Provident Financial Services, Inc., dated September 24, 2004, with respect to the consolidated statements of financial condition of First Sentinel Bancorp, Inc. as of December 31, 2003 and 2002, and the related consolidated statements of income, stockholder's equity, and cash flows, for each of the years in the three-year period ended December 31, 2003, which report appears in the December 31, 2003 Annual Report on Form 10-K/A of First Sentinel Bancorp, Inc. /s/ KPMG LLP KPMG LLP Short Hills, New Jersey September 24, 2004 EX-99.2 3 form8kamend_ex992-092304.txt PRO FORMAS EXHIBIT 99.2 PROVIDENT FINANCIAL SERVICES, INC. AND FIRST SENTINEL BANCORP, INC. Unaudited Combined Condensed Consolidated Pro Forma Statement of Financial Condition As of June 30, 2004 (in thousands)
Provident Financial First Sentinel Services, Inc. Bancorp, Inc. Pro Forma Adjustments Pro Forma Historical Historical Debit Credit Combined ---------- ---------- ----- ------ -------- ASSETS Cash and cash equivalents 142,047 50,861 9,974 2(C) 36,571 2(E),3 166,311 Federal funds sold 66,000 46,600 - - 112,600 Securities available for sale 1,025,938 792,269 - 251,863 2(A),4 1,566,344 - - - 2,701 2(F) (2,701) Securities held to maturity 471,471 - - - 471,471 Loans, net 2,360,782 1,186,501 2,851 2(F) - 3,550,134 Premises and fixed assets 47,297 14,526 1,724 2(F) - 63,547 Goodwill 19,908 - 393,169 2 - 413,077 Core deposit intangible 2,372 3,310 33,013 2(G) 3,310 2(C) 35,385 Other intangibles 1,295 - - - 1,295 Other assets 159,284 70,124 19,769 2 11,555 2 237,622 ---------- ------- -------- ------- ---------- Total assets 4,296,394 2,164,191 460,500 306,000 6,615,085 ========== ========== ======== ======= ========== LIABILITIES AND STOCKHOLDERS' EQUITY: LIABILITIES Deposits and mortgage escrow accounts 2,756,510 1,343,197 - 3,787 2(F) 4,103,494 Federal funds purchased and securities sold under agreements to repurchase 56,100 420,000 - 14,921 2(F) 491,021 Borrowed funds 638,156 125,414 - 6,165 2(F) 769,735 Subordinated debentures - 25,774 - 1,674 2(F) 27,448 Other liabilities 29,375 20,865 - 2,953 53,193 ---------- ---------- -------- ------- ---------- Total liabilities 3,480,141 1,935,250 - 29,500 5,444,891 STOCKHOLDERS' EQUITY Common stock 615 430 430 2(C) 185 2(B) 800 Additional paid in capital 608,281 214,408 214,408 2(C) 353,756 2(B) 962,037 Retained earnings 336,418 171,031 171,031 2(C) - 336,418 Treasury stock (6,706) (149,931) - 149,931 2(C) (6,706) Common stock held by the ESOP (77,257) (8,027) - 8,027 2(C) (77,257) Common stock acquired by stock award plan (42,944) - - - (42,944) Common stock acquired by the Directors' Deferred Fee Plan (DDFP) - (2,488) 10,891 2(C),2(D) - (13,379) DDFP Transition differential - (7,674) - 7,674 2(C),2(D) - Deferred compensation - DDFP - 12,561 - 818 2(C),2(D) 13,379 Accumulated other comprehensive income, net of tax effect (2,154) (1,369) - 1,369 2(C) (2,154) ---------- ---------- -------- ------- ---------- Total stockholders' equity 816,253 228,941 396,760 521,760 1,170,194 ---------- -------- -------- ------- ---------- Total liabilities and stockholders' equity 4,296,394 2,164,191 396,760 551,260 6,615,085 ========== ========== ======== ======= ==========
Provident Financial First Sentinel Services, Inc. Bancorp, Inc. Pro Forma Historical Historical Combined ---------- ---------- -------- Capital Ratios: Regulatory Tier 1 leverage capital 18.82% 11.41% 12.56% Tier 1 risk-based capital 29.30% 22.05% 19.79% Total risk-based capital 30.11% 23.21% 20.72%
See "Notes to the Unaudited Combined Condensed Consolidated Pro Forma Financial Statements" PROVIDENT FINANCIAL SERVICES, INC. AND FIRST SENTINEL BANCORP, INC. Unaudited Combined Condensed Consolidated Pro Forma Statement of Income for the six months ended June 30, 2004 (in thousands)
Provident Financial First Sentinel Services, Inc. Bancorp, Inc. Pro Forma Adjustments Pro Forma Historical Historical Debits Credits Combined ---------- ---------- ------ ------- -------- Interest income: Loans 63,727 35,264 380 (5) - 98,611 Securities 28,577 16,533 4,256 (4) 450 (5) 41,304 ---------- ---------- ------ ------- ---------- Total interest income 92,304 51,797 4,636 450 139,915 Interest expense: Deposits 15,802 8,737 - 631 (5) 23,908 Borrowed funds 9,604 14,115 - 2,444 (5) 21,275 ---------- ---------- ------ ------- ---------- Total interest expense 25,406 22,852 - 3,075 45,183 Provision for loan losses 1,650 150 - - 1,800 ---------- ---------- ------ ------- ---------- Net income after provision for loan losses 65,248 28,795 4,636 3,525 92,932 Non interest income Net gain on sale of loans and securities 2,047 805 - - 2,852 Fee and other 12,325 2,893 - - 15,218 ---------- ---------- ------ ------- ---------- Total non interest income 14,372 3,698 - - 18,070 Non interest expense General and administrative expense Compensation and benefits 28,482 10,611 - - 39,093 Occupancy and equipment 7,518 2,154 - - 9,672 Other 16,133 3,456 35 (5) - 19,624 Amortization of core deposit intangible 610 419 2,973 (5) - 4,002 ---------- ---------- ------ ------- ---------- Total non interest expense 52,743 16,640 3,008 - 72,391 Income before income tax expense 26,877 15,853 7,644 3,525 38,611 Income tax expense 8,002 5,625 2,675 1,234 12,185 ---------- ---------- ------ ------- ---------- Net income from continuing operations 18,875 10,228 4,969 2,291 26,426 ========== ========== ====== ======= ========== Income from continuing operations per share: Basic 0.34 0.39 - - 0.36 Diluted 0.34 0.37 - - 0.36 Weighted average common shares: Basic 54,791,399 26,365,109 (8) 73,332,061 Diluted 55,092,056 27,911,699 (8) 73,632,718
See "Notes to the Unaudited Combined Condensed Consolidated Pro Forma Financial Statements" PROVIDENT FINANCIAL SERVICES, INC. AND FIRST SENTINEL BANCORP, INC. Unaudited Combined Condensed Consolidated Pro Forma Statement of Income for the year ended December 31, 2003 (in thousands)
Provident Financial First Sentinel Services, Inc. Bancorp, Inc. Pro Forma Adjustments Pro Forma Historical Historical Debits Credits Combined ---------- ---------- ------ ------- -------- Interest income: Loans 123,450 73,333 950 (5) - 195,833 Securities 61,056 35,626 9,672 (4) 901 (5) 87,911 ---------- ---------- ------ ------- ---------- Total interest income 184,506 108,959 10,622 901 283,744 Interest expense: Deposits 39,171 21,533 - 1,894 (5) 58,810 Borrowed funds 15,462 28,860 - 4,887 (5) 39,435 ---------- ---------- ------ ------- ---------- Total interest expense 54,633 50,393 - 6,781 98,245 Provision for loan losses 1,160 - - - 1,160 ---------- ---------- ------ ------- ---------- Net income after provision for loan losses 128,713 58,566 10,622 7,682 184,339 Non interest income Net gain on sale of loans and securities 2,351 825 - - 3,176 Net gain on sale of branch and deposits - 2,442 - - 2,442 Fee and other 21,483 6,436 - - 27,919 ---------- ---------- ------ ------- ---------- Total non interest income 23,834 9,703 - - 33,537 Non interest expense General and administrative expense Compensation and benefits 54,683 21,152 - - 75,835 Occupancy and equipment 14,157 4,023 - - 18,180 Other 56,790 (7) 11,722 69 (5) - 68,581 Amortization of core deposit intangible 1,149 839 6,704 (5) - 8,692 ---------- ---------- ------ ------- ---------- Total non interest expense 126,779 37,736 6,773 - 171,288 Income before income tax expense 25,768 30,533 17,395 7,682 46,588 Income tax expense 7,024 12,197 6,088 2,689 15,821 ---------- ---------- ------ ------- ---------- Net income from continuing operations 18,744 18,336 11,307 4,993 30,767 ========== ========== ====== ======= ========== Income from continuing operations per share: Basic 0.31 0.71 0.40 Diluted 0.31 0.69 0.40 Weighted average common shares: Basic 57,835,726 25,706,054 (8) 76,376,388 Diluted 57,965,640 26,698,962 (8) 76,506,302
See "Notes to the Unaudited Combined Condensed Consolidated Pro Forma Financial Statements" Notes to the Unaudited Combined Condensed Consolidated Pro Forma Financial Statements The preceding Unaudited Combined Condensed Consolidated Pro Forma Statement of Condition ("Pro Forma Statement of Condition") combines the historical statements of condition of Provident and First Sentinel giving effect to the consummation of the merger as of June 30, 2004. The preceding Unaudited Combined Condensed Consolidated Pro Forma Statements of Income ("Pro Forma Income Statements") for the year ended December 31, 2003 and the six months ended June 30, 2004 give effect to the consummation of the merger as if such transaction was effective on January 1, 2003. The merger will be accounted for using the purchase method of accounting and giving effect to the related pro forma adjustments described in the accompanying notes to the Unaudited Combined Condensed Consolidated Pro Forma Financial Statements ("Pro Forma Financial Statements") The Pro Forma Financial Statements included herein are presented for information purposes only. They include various estimates and may not necessarily be indicative of the financial position or results of operations that would have occurred if the merger had taken effect on the date or at the beginning of the periods indicated or which may be obtained in the future. These statements and the accompanying notes should be read in conjunction with the historical financial statements, including the notes thereto, of Provident and First Sentinel that have been presented in prior filings with the Securities and Exchange Commission. It is anticipated that the merger will provide the combined companies with financial benefits that include reduced operating expenses and additional revenue opportunities. The pro forma information, while helpful in illustrating the financial characteristics of the combined company under one set of assumptions does not reflect the benefits of expected cost savings or opportunities to earn additional revenue and, accordingly, does not attempt to predict or suggest future results. It also does not necessarily reflect what the historical results of the combined company would have been had the companies been combined during these periods. Note (1) Basis of Presentation The merger of First Sentinel with and into Provident was completed on July 14, 2004, through the exchange of 60% of First Sentinel common stock into Provident common stock at an exchange rate of 1.092 and the conversion of 40% of First Sentinel stock into cash at $22.25 per share. The aggregate consideration paid in the merger consisted of $251.9 million in cash and 18,540,662 shares of the Provident's common stock. First Sentinel's actual fair value adjustments for loans, securities, premises and equipment, deposits and borrowings were determined by the management of Provident with the assistance of certain investment banking and independent valuation firms. The resulting premiums and discounts for the purposes of the Pro Forma Financial Statements, where appropriate, are being amortized and accreted into income as more fully described in Notes 5 and 6. Deferred tax assets and liabilities were recorded to reflect the tax consequences associated with differences between the tax basis of the assets acquired and the liabilities assumed, using an effective tax rate of 35%. Provident's and First Sentinel's historical effective tax rates for the twelve months ended December 31, 2003 and for the six months ended June 30, 2004 were 27.26% and 29.77% and 39.95% and 35.48%, respectively. First Sentinel's Pro Forma Adjustments Note (2) A reconciliation of the excess consideration paid by Provident over First Sentinel's net assets acquired ("Goodwill") is as follows (in thousands):
Cost to acquire First Sentinel: Note Cash 2(A) $ 251,863 Provident common stock issued 2(B) 353,941 Cash paid for transaction costs, net of taxes (1) 3 17,182 ----------- Consideration paid for First Sentinel 622,986 First Sentinel Net Assets at Fair Value: First Sentinel stockholders' equity at June 30, 2004 2(C) $ 228,941 Adjustment to DDFP assets 2(D) 818 Write off of identifiable intangibles 2(C) (3,310) Termination of First Sentinel ESOP 2(C) 9,974 Cash consideration paid for stock options, net of taxes (1) 2(E) (11,495) ----------- Subtotal: $ 224,928 Fair Value Adjustments: Loans 2(F) (2,851) Securities available for sale 2(F) 2,701 Premises and fixed assets 2(F) (1,724) Deposits 2(F) 3,787 Borrowed funds 2(F) 6,165 Repurchase agreements 2(F) 14,921 Subordinated debentures 2(F) 1,674 DDFP 2(D) 818 ----------- Fair Value Adjustments: 25,491 Tax effect of fair value adjustments (1) (8,922) ----------- Total adjustments to net assets acquired 16,569 ----------- Adjusted net assets acquired 208,359 ----------- Subtotal 414,627 Core deposit intangible 2(G) 33,013 Tax effect of core deposit intangible (1) (11,555) ----------- Net core deposit intangible 21,458 ----------- Estimated Goodwill Recognized 393,169
- ---------------------------------------------------------------------- (1) Assumed effective tax rate of 35% (2) Purchase accounting adjustments were estimated as follows: (A) Cash portion of the merger consideration paid for 40% of the 28,299,255 outstanding shares of First Sentinel as of July 14, 2004 at a price of $22.25 per share. (B) Issuance of 18,540,662 shares of Provident's common stock at $19.09 (Provident's average closing price from December 21, 2003 to December 26, 2003) at an exchange rate of 1.092 Provident shares for each share of First Sentinel. (C) Elimination of First Sentinel's stockholders' equity at June 30, 2004, including accumulated other comprehensive income, which represents the reversal of the unrealized loss on available for sale securities, the write off of First Sentinel's existing core deposit intangible and the termination of First Saving's ESOP. (D) Reflects the adjustment to record the DDFP at market value ($818,000) and to adjust the DDFP plan assets to market value ($3.2 million) and the elimination of the DDFP transitional differential ($7.7 million). (E) Cash consideration paid, net of taxes, for the 1,248,848 First Sentinel stock options, based on the difference between $22.25 and the exercise price of the options at the date of grant. This assumes that all First Sentinel stock options were exchanged for cash at the merger date. The weighted average exercise price at the date of the merger was $8.09. (F) Actual fair value adjustments reflect the allocation of the acquisition cost of assets acquired and liabilities assumed, based on their fair value. (G) Provident retained an independent valuation firm to perform the core deposit intangible valuation. The related core deposit intangible premium is being amortized over its estimated useful life of 8.8 years on an accelerated basis. Note (3) Transaction and acquisition costs associated with the First Sentinel merger were $17.2 million, net of taxes. Transaction and acquisition costs have been determined in accordance with the criteria specified in the EITF 95-3: Recognition of Liabilities in Connection with a Purchase Business Combination, and included in the Pro Forma Balance Sheet as a component of Goodwill (See Note (2)). A summary of these costs are as follows: Professional fees $ 8,532 Merger related compensation and benefits 10,828 Facilities and systems 2,327 Other merger related expenses 152 -------- Total pre-tax transaction costs 21,839 Less: Related tax benefit 4,657 -------- Estimated transaction costs, net of taxes $ 17,182 ======== Professional fees include investment banking, legal and other professional fees and expenses associated with stockholder and customer notifications. Merger related compensation and and benefits costs include employee severance, compensation arrangements, transitional staffing and related employee benefit expenses. Facilities and system costs include lease termination charges and equipment write-offs resulting from the consolidation of duplicate facilities. Other merger related costs include: (a) costs associated with the termination of First Sentinel's computer systems and programs that will be discontinued and (b) the write off of certain other assets (e.g., prepaid expenses) which will provide no continuing benefit to the combined entity upon consummation of the merger. These expenses will be funded by the cash of the combined organization. Merger-related costs incurred by First Sentinel were expensed as incurred and totaled $4.3 million and $639,000 for the periods ended December 31, 2003 and June 30, 2004, respectively. These costs have not been included in the above table. All other expenses incurred by Provident were capitalized or expensed as incurred, based on the nature of the costs and Provident's accounting policies for these costs. Note (4) Interest income for the twelve months ended December 31, 2003 is reduced approximately $9.7 million, on a pretax basis, related to the portion of the purchase price that was paid in cash ($251.9 million). These funds were assumed to have yielded a pretax rate of 3.84% for the year ended December 31, 2003, which represents the actual yield earned on Provident's available for sale portfolio for the period. Interest income for the six months ended June 30, 2004 is reduced approximately $4.3 million, on a pretax basis, related to the portion of the purchase price that was paid in cash ($251.9 million). These funds were assumed to have yielded a pretax rate of 3.38% for the six months ended June 30, 2004, which represents the actual yield earned on Provident's available for sale portfolio for the period. Note (5) The following table summarizes the estimated full year impact of the amortization/(accretion) of the purchase accounting adjustments on the Pro Forma Balance Sheet and the impact of amortizing and/or accreting the respective adjustments into income over their estimated useful lives:
Twelve Months Six Months Ended Ended December 31, 2003 June 30, 2004 Premium/ Estimated Amortization/ Amortization/ Category (Discounts) Life In Years (Accretion) (Accretion) - ------------------------------------------------------------------------------------------------------------------------------------ Securities $ (2,701) 3 (901) (450) Loans 2,851 5 950 380 Premises and fixed assets 1,724 25 69 35 Time deposits (3,787) 3 (1,894) (631) Borrowed funds (6,165) 5 (1,233) (617) Repurchase agreements (14,921) 5 (2,984) (1,492) Subordinated debentures (1,674) 2.5 (670) (335) Core deposit intangible 33,013 8.8 6,704 2,973 ---------- ---------------- ------------- Net Total 8,340 41 (137) ========== ================ =============
The sum of the years digits and straight line methods have been utilized in preparing the pro forma statements of income for amortizing and/or accreting the related purchase accounting adjustments. Note (6) The following table summarizes the impact of the amortization/(accretion) of the purchase accounting adjustments made in connection with the First Sentinel merger on Provident's results of operations for the following years, assuming the transaction had become effective on January 1, 2003:
Net (Increase)/ Projected Future Amounts Decrease In for the Years Core Deposit Net (Accretion)/ Income Ended December 31, Intangible Amortization Before Taxes ---------- ------------ ------------ 2003....................................... 6,704 (6,663) 41 2004....................................... 5,945 (6,220) (275) 2005....................................... 5,186 (5,444) (258) 2006....................................... 4,427 (3,768) 659 2007....................................... 3,668 (3,957) (289) 2008 and Thereafter........................ 7,083 1,379 8,462
- ---------------------------------------------------------------------- The average useful life of the core deposit intangible was 8.8 years and is being amortized utilizing the accelerated basis determined in preparing the valuation analysis. Note (7) Provident recorded a one time expense of $15.6 million, net of tax, as a result of the $24.0 million contribution to The Provident Bank Foundation, made in the first quarter of 2003. Note (8) For the twelve months ended December 31, 2003, basic and fully diluted weighted average common stock outstanding were determined by adding Provident's historical weighted average number of shares of common stock and the 18,540,662 shares that were issued to First Sentinel's stockholders under the terms of the merger agreement. For the six months ended June 30, 2004, basic and fully diluted weighted average common stock outstanding were determined by adding Provident's historical weighted average number of shares of common stock and the 18,540,662 shares that were issued to First Sentinel's stockholders under the terms of the merger agreement. -----END PRIVACY-ENHANCED MESSAGE-----