Santander Bancorp - Current report filing (8-K)
December 28 2007 - 3:05PM
Edgar (US Regulatory)
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): December 20, 2007
(Exact name of registrant as specified in its charter)
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Puerto Rico
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001-15849
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66-0573723
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(State or other
jurisdiction of
incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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207 Ponce de León Avenue, San Juan, Puerto Rico
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00917
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(Address of principal executive offices)
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(Zip Code)
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Registrants telephone number, including area code:
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(787) 777-4100
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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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o
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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 240.136-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
On December 20, 2007, Banco Santander Puerto Rico (the Bank), a wholly owned subsidiary of
Santander BanCorp, after a bidding process that included the
participation of several potential purchasers, consummated a sale and
lease-back transaction with two unaffiliated third parties for the Banks two
principal properties. The two properties are (i) the Banco Santander Headquarters Building, a
seven story corporate headquarters building located at 207 Ponce de León Avenue, Hato Rey, Puerto
Rico, including a related parking facility (the Headquarters Facility); and (ii) the Santander Operations Facility, a nine story
building located at No. 3 Arterial Hostos Avenue, New San Juan Center, Hato Rey, Puerto Rico (the
Operations Facility). In connection with the transaction, the Bank entered into two separate
Sale-Purchase Agreements with Corporación Hato Rey Uno and Corporación Hato Rey Dos, respectively,
as purchasers. The properties were sold on an as-is, where-is basis, at a purchase price of $37
million for the Headquarters Facility and $25.25 million for the Operations Facility.
Concurrently with the execution of the purchase agreements, the Bank entered into long-term
lease agreements for the properties. The lease agreements are for an initial term of fifteen (15)
years, commencing on December 20, 2007 (the Effective Date) and ending on December 31, 2022. The
Bank may extend each lease for two (2) consecutive five (5) year periods (the Option Terms), on
substantially the same terms and conditions; provided, that, in the case of the Headquarters
Facility, the Bank may, in its discretion, extend the lease for all or a portion of the building,
as described in the lease agreement. Commencing on the Effective Date and continuing throughout
the initial term, the Bank will pay a monthly rent of $224,270 in the case of the Headquarters
Facility and $174,542.50 in the case of the Operations Facility, subject to certain escalation
provisions described in the lease agreements. In addition, the monthly rent payable under each of
the agreements is subject to a fair market value adjustment at the beginning of each the Option
Term. The monthly rents are payable in advance, in equal monthly installments, on the first day of
each calendar month.
Subject to certain terms and conditions, the Bank has a right of first refusal to repurchase
each of the properties for cash if the purchasers or one or more members of the purchasers Control
Group (as defined in the lease agreements) receive and determine to accept a
bona fide
offer from a
third party to (i) in the case of the purchasers, purchase the properties; or (ii) in the case of
the members of the Control Group, purchase all or part of the outstanding direct or indirect
ownership interest in the purchasers that would result in a change of control (as defined in the
lease agreements) of the purchasers.
SIGNATURE
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.
Dated: December 28, 2007
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SANTANDER BANCORP
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By:
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/s/
María Calero
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Name:
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María Calero
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Title:
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Executive Vice President and
Chief Accounting Officer
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