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CB Financial Services, Inc. – ‘S-4/A’ on 7/28/14

On:  Monday, 7/28/14, at 5:28pm ET   ·   Accession #:  1193125-14-282604   ·   File #:  333-196749

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 7/28/14  CB Financial Services, Inc.       S-4/A                  8:6.5M                                   RR Donnelley/FA

Document/Exhibit                   Description                      Pages   Size 

 1: S-4/A       Pre-Effective Amendment to Registration of          HTML   4.67M 
                          Securities Issued in a                                 
                          Business-Combination Transaction                       
 2: EX-5        Opinion re: Legality                                HTML     12K 
 3: EX-8.1      Opinion re: Tax Matters                             HTML     18K 
 4: EX-8.2      Opinion re: Tax Matters                             HTML     14K 
 5: EX-23.3     Consent of Experts or Counsel                       HTML      7K 
 6: EX-23.4     Consent of Experts or Counsel                       HTML      7K 
 7: EX-99.1     Miscellaneous Exhibit                               HTML     25K 
 8: EX-99.2     Miscellaneous Exhibit                               HTML     33K 

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As filed with the Securities and Exchange Commission on July 28, 2014.

Registration No. 333-196749

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

PRE-EFFECTIVE AMENDMENT NO. 1

TO

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

CB Financial Services, Inc.

(Exact name of registrant as specified in its charter)

Copies to:

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement and the conditions to the consummation of the merger described herein have been satisfied or waived.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

¨  If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  ¨

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  ¨

CALCULATION OF REGISTRATION FEE

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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Proxy Statement		Prospectus

MERGER PROPOSAL — YOUR VOTE IS VERY IMPORTANT

Dear FedFirst Stockholder:

Your board of directors has agreed unanimously on a proposed transaction that, if completed, will result in the merger of FedFirst Financial Corporation (“FedFirst”) with and into CB Financial Services, Inc (“CB”). You are being asked to approve the merger by approving an Agreement and Plan of Merger between FedFirst and CB (which we refer to as the merger agreement) at a special meeting of stockholders to be held on                     , 2014.

If the merger agreement is approved at the special meeting, and subject to the other conditions of the merger agreement, FedFirst will be merged into CB, with CB as the surviving entity. As a result, you will have the right to receive for each of your shares of FedFirst common stock: (1) $23.00 in cash or (2) 1.1590 shares of CB common stock. You may elect to receive cash, CB common stock, or a combination of cash and CB common stock for your shares of FedFirst common stock. Regardless of your election, however, it will be limited by the requirement in the merger agreement that 65% of the total shares of FedFirst common stock is exchanged for CB common stock and 35% is exchanged for cash. Therefore, allocations of CB common stock and cash that you receive will depend on the elections made by other FedFirst stockholders. Based upon the number of shares of FedFirst common stock outstanding, CB expects to pay $20.2 million in cash (which includes $1.9 million in settlement of Fed First stock options) and issue a total of 1,744,615 shares of CB common stock upon completion of the merger. The federal income tax consequences of the merger to you will depend on whether you receive cash, CB common stock or a combination of cash and CB common stock in exchange for your shares of FedFirst common stock. We expect the merger to be tax-free for federal income tax purposes to you with respect to any shares of CB common stock you receive in exchange for your shares of FedFirst common stock.

The common stock of CB is quoted on the OTC Market under the symbol “CBFV.” The closing price of CB common stock on April 14, 2014, the trading day before the proposed merger was publicly announced, was $19.75, which based on the 1.1590 exchange ratio, represented a value of $22.89 per share of FedFirst common stock. The closing price of CB common stock on                     , 2014, the most recent practicable trading date before the date of this document, was $         per share, which represented a value of $         per share of FedFirst common stock based on the exchange ratio. The market prices for both CB common stock and FedFirst common stock will fluctuate before the merger. We urge you to obtain current market quotations for both CB common stock and FedFirst common stock (Nasdaq: trading symbol “FFCO”).

After careful consideration, the board of directors of FedFirst has determined that the merger is in the best interests of stockholders and recommends that FedFirst stockholders vote “FOR” the proposal to approve the merger agreement and “FOR” each of the other items to be considered at the FedFirst special meeting. Approval of the merger agreement requires the affirmative vote of the holders of a majority of the outstanding shares of FedFirst common stock.

This document contains information that you should consider in evaluating the merger agreement and the proposed merger. In particular, you should carefully read the section captioned “Risk Factors” beginning on page 9 for a discussion of certain risk factors relating to the merger agreement and the merger.

We cannot complete the merger unless FedFirst’s stockholders approve the merger agreement and we receive all applicable regulatory approvals. Whether or not you plan to attend the special meeting of stockholders of FedFirst, please complete, sign, date and return the enclosed proxy card. Your vote is important. If you do not return your proxy card, it will have the same effect as a vote against the merger.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or completeness of this proxy statement/prospectus. Any representation to the contrary is a criminal offense.

The securities to be issued in the merger are not savings or deposit accounts or other obligations of any bank or nonbank subsidiary of either CB or FedFirst, and they are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This proxy statement/prospectus is dated                     , 2014 and is first being mailed to FedFirst stockholders on or about                     , 2014.

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565 Donner Avenue

Monessen, Pennsylvania 15062

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

A special meeting of stockholders of FedFirst Financial Corporation will be held at             ,         ,         , Pennsylvania, at         .m., local time, on                     , 2014.

At the special meeting, you will be asked to:

A copy of the Agreement and Plan of Merger, which is referred to as the “merger agreement,” is included as Annex A to the accompanying proxy statement/prospectus. The proxy statement/prospectus describes the merger agreement and the proposed merger in detail. We urge you to read it carefully. The proxy statement/prospectus forms a part of this notice.

The board of directors of FedFirst Financial Corporation unanimously recommends that FedFirst stockholders vote “FOR” the proposal to approve the merger agreement, “FOR” the proposal to approve the Merger-Related Executive Compensation, and “FOR” the proposal to adjourn the special meeting, if necessary, to solicit additional proxies to vote in favor of the merger agreement.

FedFirst’s board of directors has fixed the close of business on             , 2014 as the record date for determining the stockholders entitled to notice of, and to vote at, the special meeting and any adjournments or postponements of the special meeting. FedFirst stockholders do not have dissenters’ rights of appraisal in connection with the merger.

Your vote is very important. Your proxy is being solicited by FedFirst’s board of directors. The proposal to approve the merger agreement must be approved by the affirmative vote of the holders of a majority of the outstanding shares of FedFirst common stock in order to complete the proposed merger. Whether or not you plan to attend the special meeting, please complete and mail the enclosed proxy card in the accompanying envelope, which requires no postage if mailed in the United States. You may revoke your proxy at any time before the special meeting. If you attend the special meeting and vote in person, your proxy vote will not be used.

If you have questions about the merger, or how to submit your proxy, please contact                     , at (        )                     .

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QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETING

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RISK FACTORS

In addition to the other information included in this proxy statement/prospectus, you should consider carefully the risk factors described below in deciding how to vote. You should keep these risk factors in mind when you read forward-looking statements in this document. Please refer to the section of this proxy statement/prospectus titled “Cautionary Note Regarding Forward-Looking Statements.”

Risks Related to the Merger

Because the market price of CB common stock will fluctuate, FedFirst stockholders cannot be certain of the market value of the merger consideration they will receive.

Upon completion of the merger, each share of FedFirst common stock will be converted into either 1.1590 shares of CB common stock or $23.00 in cash. The market value of the stock consideration may vary from the value on the date CB announced the merger, on the date that this proxy statement/prospectus is mailed to FedFirst stockholders, on the date of the special meeting of FedFirst stockholders and on the date the merger is completed and thereafter. Any change in the market price of CB common stock prior to the completion of the merger will affect the market value of the merger consideration that FedFirst stockholders will receive upon completion of the merger, and there will be no adjustment to the merger consideration for changes in the market price of either shares of CB common stock or shares of FedFirst common stock. Stock price changes may result from a variety of factors that are beyond the control of CB and FedFirst, including but not limited to general market and economic conditions, changes in their respective businesses, operations and prospects and regulatory considerations. Therefore, at the time of the FedFirst special meeting you will not know the precise market value of the consideration you will receive at the effective time of the merger. You should obtain current market quotations for shares of CB common stock and for shares of FedFirst common stock.

The price of CB common stock might decrease after the merger.

Following the merger, many holders of FedFirst common stock will become shareholders of CB. CB common stock could decline in value before or after the merger. For example, during the twelve-month period ended             , 2014 (the most recent practicable date before the printing of this document), the closing price of CB common stock varied from a low of $         to a high of $         and ended that period at $        . The market value of CB common stock fluctuates based upon general market economic conditions, CB’s business and prospects, and other factors, many of which CB cannot control.

FedFirst stockholders may receive a form of consideration different from what they elect.

The consideration to be received by FedFirst stockholders in the merger is subject to the requirement that 65% of the shares of FedFirst common stock be exchanged for CB common stock and 35% be exchanged for cash. The merger agreement contains proration and allocation procedures to achieve this desired result. If you elect all cash and the available cash is oversubscribed, then you will receive a portion of the merger consideration in CB common stock. If you elect all stock and the available stock is oversubscribed, then you will receive a portion of the merger consideration in cash.

CB and Community Bank may be unable to successfully integrate FedFirst’s operations and retain FedFirst’s employees.

The merger involves the integration of two companies that have previously operated independently. The difficulties of combining the operations of the two companies include integrating personnel with diverse business backgrounds, combining different corporate cultures, and retaining key employees. The process of integrating operations could interrupt, or impair the momentum in, the business and activities of CB and FedFirst and could lead to the loss of key personnel. The diversion of management’s attention and any delays or difficulties encountered in connection with the merger and the integration of the two companies’ operations could have an adverse effect on the business and results of operations of CB following the merger.

Additionally, CB may not be able to successfully achieve the level of cost savings, revenue enhancements, and other synergies that it expects, and may not be able to capitalize upon the existing customer relationships of FedFirst to the extent anticipated, or it may take longer, or be more difficult or expensive than expected, to achieve these goals. This could have an adverse affect on CB’s business, results of operation and stock price.

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The termination fee and the restrictions on solicitation contained in the merger agreement may discourage other companies from trying to acquire FedFirst.

Until the completion of the merger, FedFirst is prohibited from soliciting, initiating, encouraging or taking any other action to facilitate any inquiries, discussions or the making of any proposals that may lead to an acquisition proposal, such as a merger or other business combination transaction, with any person other than CB. In addition, FedFirst has agreed to pay a termination fee to CB in specified circumstances. These provisions could discourage other companies from trying to acquire FedFirst even though those other companies may be willing to offer greater value to FedFirst’s stockholders than what CB has offered in the merger. The payment of the termination fee also could have a material adverse effect on FedFirst’s financial condition and results of operations.

Certain of FedFirst’s officers and directors have interests that are different from, or in addition to, interests of FedFirst’s stockholders generally.

The directors and officers of FedFirst have interests in the merger that are different from, or in addition to, the interests of FedFirst stockholders generally. These include: the cancellation of stock options with an exercise price of less than $23.00 in exchange for a cash payment equal to $23.00 minus the exercise price for each option; accelerated vesting of restricted stock; provisions in the merger agreement relating to indemnification of directors and officers and insurance for directors and officers of FedFirst for events occurring before the merger; the appointment of four directors of FedFirst to the boards of directors of CB and Community Bank; continued employment with Community Bank for certain executive officers of FedFirst; severance payments that certain officers may receive under existing change in control agreements; and the buy-out by FedFirst Exchange Corporation of Mr. Boyer’s 20% minority interest in Exchange Underwriters, Inc. immediately before the completion of the merger.

For a more detailed discussion of these interests, see “Description of the Merger—Interests of Certain Persons in the Merger that are Different from Yours.”

Failure to complete the merger could negatively impact the stock prices and future businesses and financial results of CB and FedFirst.

If the merger is not completed, the ongoing businesses of CB and FedFirst may be adversely affected and CB and FedFirst will be subject to several risks, including the following:

In addition, the financial markets as well as customers and employees of CB and/or FedFirst may react unfavorably if the merger is not completed. CB and/or FedFirst also could be subject to litigation related to any failure to complete the merger.

FedFirst stockholders will have a reduced ownership and voting interest after the merger and will exercise less influence over management of the combined organization.

FedFirst stockholders currently have the right to vote to elect the FedFirst board of directors and to vote on various other matters affecting FedFirst. Upon the completion of the merger, FedFirst stockholders who receive CB common stock in the merger will become shareholders of CB with a percentage ownership interest in the combined organization that is substantially less than their percentage ownership of FedFirst. Accordingly, FedFirst stockholders will not be able to exercise as much influence over the management and policies of CB as they currently can with respect to FedFirst.

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FedFirst will be subject to business uncertainties and contractual restrictions while the merger is pending.

Uncertainty about the effect of the merger on employees and customers may have an adverse effect on FedFirst. These uncertainties may impair FedFirst’s ability to attract, retain and motivate key personnel until the merger is completed, and could cause customers and others that deal with FedFirst to seek to change existing business relationships with FedFirst. Retention of certain employees by FedFirst may be challenging while the merger is pending, as certain employees may experience uncertainty about their future roles with FedFirst or CB. If key employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with FedFirst or CB, FedFirst’s business or FedFirst’s business assumed by CB following the merger could be harmed. In addition, subject to certain exceptions, FedFirst has agreed to operate its business in the ordinary course prior to closing. See “The Merger Agreement—Covenants and Agreements” for a description of the restrictive covenants applicable to FedFirst.

Pending litigation against FedFirst and CB could result in an injunction preventing the completion of the merger or a judgment resulting in the payment of damages.

In connection with the merger, a FedFirst stockholder has filed a putative stockholder class action lawsuit against FedFirst, each of FedFirst’s directors, and CB. Among other remedies, the plaintiff seeks to enjoin the merger. The outcome of any such litigation is uncertain. If the case is not resolved, the lawsuit could prevent or delay completion of the merger and result in substantial costs to FedFirst and CB, including any costs associated with the indemnification of directors and officers. Additional lawsuits may be filed against FedFirst, CB and/or the directors and officers of either company in connection with the merger. The defense or settlement of any lawsuit or claim that remains unresolved at the time the merger is completed may adversely affect CB’s and FedFirst’s respective business, financial condition, results of operations and cash flows. See “The Merger—Pending Litigation Regarding the Merger.”

In certain circumstances, cash merger consideration received may be taxed as a dividend rather than capital gains and FedFirst’s counsel is not able to provide an opinion regarding whether this tax treatment will apply to any individual shareholder.

In certain circumstances, the cash merger consideration received by a FedFirst stockholder who receives CB common stock and cash may be taxed as a dividend, rather than as capital gain. This could arise if there has not been a meaningful reduction in the stockholder’s interest in CB as a result of the exchange. For purposes of this determination, the shareholder generally will be treated as if the shareholder first exchanged all of the shareholders shares of FedFirst common stock solely for CB common stock and then CB immediately redeemed a portion of the CB common stock in exchange for the cash the stockholder actually received. Moreover, the FedFirst stockholder may be deemed to constructively own shares of CB common stock held by certain members of the stockholder’s family or certain entities in which the stockholder has an ownership or beneficial interest, and certain stock options may be aggregated with the stockholder’s shares of CB common stock. Because the determination as to whether a stockholder’s interest has been meaningfully reduced is based on facts and circumstances unique to each stockholder, the opinion received from FedFirst’s legal counsel will not opine as to such treatment at the individual stockholder level.

FedFirst stockholders who make elections may be unable to sell their shares in the market pending the merger.

FedFirst stockholders may elect to receive cash, stock or mixed consideration in the merger by completing an election form that will be sent under separate cover. Making an election will require that stockholders who hold their shares in certificate form turn in their FedFirst stock certificates. This means that during the time between when the election is made and the date the merger is completed, FedFirst stockholders will be unable to sell their FedFirst common stock. If the merger is unexpectedly delayed, this period could extend for a significant period of time. FedFirst stockholders can shorten the period during which they cannot sell their shares by delivering their election shortly before the election deadline. However, elections received after the election deadline will not be accepted or honored.

The fairness opinion obtained by FedFirst from its financial advisor will not reflect changes in circumstances subsequent to the date of the fairness opinion.

Mufson Howe Hunter & Company LLC, FedFirst’s financial advisor in connection with the merger, has delivered to the board of directors of FedFirst its opinion dated as of April 14, 2014. The opinion of Mufson Howe Hunter stated that as of such date, and based upon and subject to the factors and assumptions set forth therein, the merger consideration to be paid to

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the holders of the outstanding shares of FedFirst common stock pursuant to the merger agreement was fair from a financial point of view to such holders. The opinion does not reflect changes that may occur or may have occurred after the date of the opinion, including changes to the operations and prospects of CB or FedFirst, changes in general market and economic conditions or regulatory or other factors. Any such changes, or changes in other factors on which the opinion is based, may materially alter or affect the value of CB and FedFirst.

Risks Related to CB

Changes in interest rates may reduce CB’s profits and impair asset values.

CB’s earnings and cash flows depend primarily on its net interest income. Interest rates are highly sensitive to many factors that are beyond CB’s control, including general economic conditions and the policies of various governmental and regulatory agencies, particularly the Federal Reserve. Changes in market interest rates could have an adverse effect on CB’s financial condition and results of operations. CB’s interest-bearing liabilities generally reprice or mature more quickly than its interest-earning assets. If rates increase rapidly, CB may have to increase the rates paid on deposits, particularly higher cost time deposits and borrowed funds, more quickly than any changes in interest rates earned on loans and investments, resulting in a negative effect on interest rate spreads and net interest income. Increases in interest rates may also make it more difficult for borrowers to repay adjustable rate loans.

Conversely, should market interest rates fall below current levels, CB’s net interest margin also could be negatively affected if competitive pressures keep it from further reducing rates on deposits, while the yields on CB’s interest-earning assets decrease more rapidly through loan prepayments and interest rate adjustments. Decreases in interest rates often result in increased prepayments of loans and mortgage-related securities, as borrowers refinance their loans to reduce borrowings costs. Under these circumstances, CB is subject to reinvestment risk to the extent it is unable to reinvest the cash received from such prepayments in loans or other investments that have interest rates that are comparable to the interest rates on existing loans and securities.

Changes in interest rates also affect the value of CB’s interest-earning assets, and in particular its securities portfolio. Generally, the value of fixed-rate securities fluctuates inversely with changes in interest rates. Unrealized gains and losses on securities available for sale determined to be temporary in nature are reported as a separate component of equity. Decreases in the fair value of securities available for sale resulting from increases in interest rates therefore could have an adverse effect on CB’s shareholders’ equity.

A large percentage of CB’s loans are collateralized by real estate, and further disruptions in the real estate market may result in losses and reduce CB’s earnings.

A substantial portion of CB’s loan portfolio consists of loans collateralized by real estate. Continued weak economic conditions have caused a decrease in demand for real estate, which has resulted in an erosion of some real estate values in CB’s markets. Further disruptions in the real estate market could significantly impair the value of CB’s collateral and its ability to sell the collateral upon foreclosure. The real estate collateral in each case provides an alternate source of repayment in the event of default by the borrower and may deteriorate in value during the time the credit is extended. If real estate values decline further, it is likely that CB would be required to increase its allowance for loan losses. If, during a period of lower real estate values, CB is required to liquidate the collateral securing a loan to satisfy debts or to increase its allowance for loan losses, it could materially reduce its profitability and adversely affect its financial condition.

Strong competition within CB’s market area could adversely affect CB’s earnings and slow growth.

CB faces intense competition both in making loans and attracting deposits. Price competition for loans and deposits might result in CB earning less on its loans and paying more on its deposits, which reduces net interest income. Some of CB’s competitors have substantially greater resources than CB has and may offer services that it does not provide. CB expects competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing consolidation in the financial services industry. CB’s profitability will depend upon its continued ability to compete successfully in its market areas.

Government responses to economic conditions may adversely affect CB’s operations, financial condition and earnings.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) has changed the bank regulatory framework. For example, the law created an independent Consumer Financial Protection Bureau that has assumed

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the consumer protection responsibilities of the various federal banking agencies, established more stringent capital standards for banks and bank holding companies, and gave the Federal Reserve exclusive authority to regulate both banking holding companies and savings and loan holding companies. The legislation also has resulted in numerous new regulations affecting the lending, funding, trading and investment activities of banks and bank holding companies. The Consumer Financial Protection Bureau has broad rule-making authority for a wide range of consumer protection laws that apply to all banks and savings institutions (including Community Bank), including the authority to prohibit “unfair, deceptive or abusive” acts and practices. Banks and savings institutions with $10.0 billion or less in assets will continue to be examined by their applicable bank regulators. The Dodd-Frank Act also requires the federal banking agencies to promulgate rules requiring mortgage lenders to retain a portion of the credit risk related to loans that are securitized and sold to investors, and in 2013 the federal bank agencies proposed a rule regarding retention of credit risk on loan sales. CB expects that these rules would make it more difficult for it to sell loans in the secondary market. Bank regulatory agencies also have been responding aggressively to any safety and soundness or compliance concerns identified in examinations, and such agencies have broad discretion and significant resources to initiate enforcement actions against financial institutions and their directors and officers in connection with their examination authority. Ongoing uncertainty and adverse developments in the financial services industry and in the domestic and international credit markets, and the effect of new legislation and regulatory actions in response to these conditions, may adversely affect CB’s operations by restricting business activities, including the ability to originate or sell loans, modify loan terms, or foreclose on property securing loans.

The full impact of the Dodd-Frank Act on CB’s business will not be known until all key regulations implementing the statute are adopted and implemented. As a result, CB cannot, at this time, determine the extent to which the Dodd-Frank Act will impact its business, operations or financial condition. However, compliance with these new laws and regulations has required and will continue to require changes to its business and operations and may result in additional costs and divert management’s time from other business activities, any of which may adversely impact its results of operations, liquidity or financial condition.

Furthermore, the Federal Reserve, in an attempt to improve the overall economy, has, among other things, adopted a low interest rate policy through its targeted federal funds rate and the purchase of mortgage-backed securities known as “quantitative easing.” Because of improvements in the national economy over the past few years, the Federal Reserve has begun to reduce its mortgage-backed securities purchases. Any reduction or termination of the mortgage-backed bond purchases or increases in the federal funds rate may result in an increase in market interest rates, which may negatively affect the housing markets, the U.S. economic recovery and CB’s results of operations, liquidity or financial condition.

Proposed and final regulations would restrict Community Bank’s ability to originate and sell loans.

The Consumer Financial Protection Bureau has issued a rule designed to clarify for lenders how they can avoid legal liability under the Dodd-Frank Act, which holds lenders accountable for ensuring a borrower’s ability to repay a mortgage. Loans that meet this “qualified mortgage” definition will be presumed to have complied with the new ability-to-repay standard. Under the Consumer Financial Protection Bureau’s rule, a “qualified mortgage” loan must not contain certain specified features, including:

Also, to qualify as a “qualified mortgage,” a loan must be made to a borrower whose total monthly debt-to-income ratio does not exceed 43%. Lenders must also verify and document the income and financial resources relied upon to qualify the borrower on the loan and underwrite the loan based on a fully amortizing payment schedule and maximum interest rate during the first five years, taking into account all applicable taxes, insurance and assessments. Although the significant majority of CB’s historical loan originations would qualify as qualified mortgages under the new rule on qualified mortgages, the new rule may limit CB’s ability or desire to make certain types of loans or loans to certain borrowers, and may make it more costly and/or time consuming to make these loans, which could limit CB’s growth and/or profitability. The new rule may also alter CB’s residential mortgage loan origination mix between qualified and non-qualified mortgage loans, which could reduce gain on sale fees from secondary market loan sales and affect interest rate risk related to non-qualified loans that are originated and held in CB’s portfolio.

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A worsening of economic conditions could adversely affect CB’s financial condition and results of operations.

Although the U.S. economy has emerged from the severe recession that occurred in 2008 and 2009, recent economic growth has been slow and uneven, and unemployment levels remain high compared to long-term, historical averages. Recovery by many businesses has been impaired by lower consumer spending and a notable portion of new jobs created nationally have been in lower wage positions. A return to prolonged deteriorating economic conditions could significantly affect the markets in which CB operates, the value of loans and investments, and ongoing operations, costs and profitability. Further declines in real estate values and sales volumes and continued elevated unemployment levels may result in higher than expected loan delinquencies, increases in nonperforming and criticized classified assets and a decline in demand for CB’s products and services. These events may cause CB to incur losses and may adversely affect its financial condition and results of operations.

If CB’s allowance for loan losses is not sufficient to cover actual loan losses, CB’s results of operations would be negatively affected.

In determining the amount of the allowance for loan losses, CB analyzes its loss and delinquency experience by loan categories and considers the effect of existing economic conditions. In addition, CB makes various assumptions and judgments about the collectability of the loan portfolio, including the creditworthiness of its borrowers and the value of the real estate and other assets serving as collateral for the repayment of many of the loans. If the results of these analyses are incorrect, the allowance for loan losses may not be sufficient to cover losses inherent in the portfolio, which would require additions to the allowance and would reduce net income.

In addition, bank regulators periodically review CB’s allowance for loan losses and may require it to increase the allowance for loan losses or recognize further loan charge-offs. Any increase in the allowance for loan losses or loan charge-offs as required by these regulatory authorities may have a material adverse effect on CB’s financial condition and results of operations.

Because CB emphasizes commercial real estate and commercial loan originations, its credit risk may increase and continued downturns in the local real estate market or economy could adversely affect its earnings.

Commercial real estate and commercial loans generally have more inherent risk than the residential real estate loans. Because the repayment of commercial real estate and commercial loans depends on the successful management and operation of the borrower’s properties or related businesses, repayment of such loans can be affected by adverse conditions in the local real estate market or economy. Commercial real estate and commercial loans also may involve relatively large loan balances to individual borrowers or groups of related borrowers. A downturn in the real estate market or the local economy could adversely affect the value of properties securing the loan or the revenues from the borrower’s business, thereby increasing the risk of nonperforming loans. As CB’s commercial real estate and commercial loan portfolios increase, the corresponding risks and potential for losses from these loans may also increase. Furthermore, it may be difficult to assess the future performance of newly originated commercial loans, as such loans may have delinquency or charge-off levels above CB’s historical experience, which could adversely affect CB’s future performance.

The impact of the changing regulatory capital requirements and new capital rules is uncertain.

In July 2013, the FDIC and the other federal bank regulatory agencies issued a final rule that will revise their risk-based capital requirements and the method for calculating risk-weighted assets to make them consistent with agreements that were reached by the Basel Committee on Banking Supervision and certain provisions of the Dodd-Frank Act. The final rule applies to all depository institutions (such as Community Bank), top-tier bank holding companies with total consolidated assets of $500 million or more (such as CB following the merger) and top-tier savings and loan holding companies. Among other things, the rule establishes a new common equity Tier 1 minimum capital requirement (4.5% of risk-weighted assets), increases the minimum Tier 1 capital to risk-based assets requirement (from 4.0% to 6.0% of risk-weighted assets) and assigns a higher risk weight (150%) to exposures that are more than 90 days past due or are on nonaccrual status and to certain commercial real estate facilities that finance the acquisition, development or construction of real property. The final rule also requires unrealized gains and losses on certain “available-for-sale” securities holdings to be included for purposes of calculating regulatory capital requirements unless a one-time opt-in or opt-out is exercised. The rule limits a banking organization’s capital distributions and certain discretionary bonus payments if the banking organization does not hold a “capital conservation buffer” consisting of 2.5% of common equity Tier 1 capital to risk-weighted assets in addition to the amount necessary to meet its minimum risk-based capital requirements. The final rule becomes effective for Community

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Bank and CB on January 1, 2015. The capital conservation buffer requirement will be phased in at 0.625% per year beginning January 1, 2016 and ending January 1, 2019, when the full 2.5% capital conservation buffer requirement will be effective.

The application of the new capital requirements for Community Bank and CB could, among other things, result in lower returns on invested capital, require raising additional capital, and result in regulatory actions if they are unable to comply with such requirements. The changes under the new capital requirements could also result in management modifying its business strategy, and limit CB’s ability to make distributions (including paying dividends) or repurchasing its shares.

There may be a limited market for CB’s common stock, which may adversely affect its stock price.

It is a condition to the completion of the merger that CB’s common stock be approved for listing on the Nasdaq Stock Market upon notice of issuance. There is no guarantee that there will be an active trading market in CB’s common stock. If an active trading market does not develop, you may not be able to sell all of your shares of common stock on short notice or at a desirable price, and the sale of a large number of shares at one time by another shareholder could temporarily depress the market price.

CB’s ability to pay dividends is subject to the ability of Community Bank to make capital distributions to CB, and also may be limited by Federal Reserve policy.

CB’s long-term ability to pay dividends to its shareholders depends primarily on the ability of Community Bank to make capital distributions to CB and on the availability of cash at the holding company level if Community Bank’s earnings are not sufficient to pay dividends. In addition, the Federal Reserve has issued a policy statement regarding the payment of dividends by bank holding companies. In general, the policy provides that dividends should be paid only out of current earnings and only if the prospective rate of earnings retention by the holding company appears consistent with the organization’s capital needs, asset quality and overall financial condition. Regulatory guidance provides for prior regulatory consultation with respect to capital distributions in certain circumstances such as where the holding company’s net income for the past four quarters, net of dividends paid over that period, is insufficient to fully fund the dividend or the holding company’s overall rate or earnings retention is inconsistent with the its capital needs and overall financial condition. These regulatory policies may adversely affect CB’s ability to pay dividends or otherwise engage in capital distributions.

Changes in CB’s accounting policies or in accounting standards could materially affect how CB reports its financial condition and results of operations.

CB’s accounting policies are essential to understanding its financial condition and results of operations. Some of these policies require the use of estimates and assumptions that may affect the value of CB’s assets and liabilities, and financial results. Some of CB’s accounting policies are critical because they require management to make difficult, subjective, and complex judgments about matters that are inherently uncertain, and because it is likely that materially different amounts would be reported under different conditions or using different assumptions. If such estimates or assumptions underlying CB’s financial statements are incorrect, it may experience material losses.

From time to time, the Financial Accounting Standards Board and the Securities and Exchange Commission change the financial accounting and reporting standards or the interpretation of those standards that govern the preparation of CB’s financial statements. These changes are beyond CB’s control, can be difficult to predict and could materially affect how CB reports its financial condition and results of operations. CB could also be required to apply a new or revised standard retroactively, resulting in restating prior period financial statements in material amounts.

The need to account for certain assets at estimated fair value, such as loans held for sale and investment securities, may adversely affect CB’s financial condition and results of operations.

CB reports certain assets, such as loans held for sale and investment securities, at estimated fair value. Generally, for assets that are reported at fair value, CB uses quoted market prices or valuation models that utilize observable market inputs to estimate fair value. Because CB carries these assets on its books at their estimated fair value, it may incur losses even if the asset in question presents minimal credit risk.

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Because the nature of the financial services business involves a high volume of transactions, CB faces significant operational risks.

CB operates in diverse markets and relies on the ability of its employees and systems to process a significant number of transactions. Operational risk is the risk of loss resulting from operations, including the risk of fraud by employees or persons outside a company, the execution of unauthorized transactions by employees, errors relating to transaction processing and technology, breaches of the internal control system and compliance requirements, and business continuation and disaster recovery. Insurance coverage may not be available for such losses, or where available, such losses may exceed insurance limits. This risk of loss also includes the potential legal actions that could arise as a result of an operational deficiency or as a result of noncompliance with applicable regulatory standards, adverse business decisions or their implementation, and customer attrition due to potential negative publicity. If a breakdown occurs in the internal controls system, improper operation of systems or improper employee actions, CB could incur financial loss, face regulatory action, and suffer damage to its reputation.

Risks associated with system failures, interruptions, or breaches of security could negatively affect CB’s earnings.

Information technology systems are critical to CB’s business. CB uses various technology systems to manage customer relationships, general ledger, securities investments, deposits, and loans. CB has established policies and procedures to prevent or limit the effect of system failures, interruptions, and security breaches, but such events may still occur or may not be adequately addressed if they do occur. In addition, any compromise of CB’s systems could deter customers from using its products and services. Security systems may not protect systems from security breaches.

In addition, CB outsources some of its data processing to certain third-party providers. If these third-party providers encounter difficulties, or if CB has difficulty communicating with them, CB’s ability to adequately process and account for transactions could be affected, and business operations could be adversely affected. Threats to information security also exist in the processing of customer information through various other vendors and their personnel.

The occurrence of any system failures, interruption, or breach of security could damage CB’s reputation and result in a loss of customers and business thereby subjecting it to additional regulatory scrutiny, or could expose is to litigation and possible financial liability. Any of these events could have a material adverse effect on its financial condition and results of operations.

CB’s risk management framework may not be effective in mitigating risk and reducing the potential for significant losses.

CB’s risk management framework is designed to minimize risk and loss to the company. CB seeks to identify, measure, monitor, report and control exposure to risk, including strategic, market, liquidity, compliance and operational risks. While CB uses a broad and diversified set of risk monitoring and mitigation techniques, these techniques are inherently limited because they cannot anticipate the existence or future development of currently unanticipated or unknown risks. Economic conditions and heightened legislative and regulatory scrutiny of the financial services industry, among other developments, have increased CB’s level of risk. Accordingly, CB could suffer losses if it fails to properly anticipate and manage these risks.

Being a public company will increase CB’s expenses and administrative workload and will expose it to risks relating to evaluation of its internal controls over financial reporting required by Section 404 of the Sarbanes-Oxley Act of 2002.

As a public company, CB will need to comply with additional laws and regulations, including the Sarbanes-Oxley Act of 2002, the Dodd-Frank Act, and related rules of the SEC and requirements of The Nasdaq Stock Market. CB was not required to comply with these laws and requirements as a private company. Complying with these laws and regulations will require the time and attention of CB’s board of directors and management and will increase CB’s expenses. Among other things, CB will need to: design, establish, evaluate and maintain a system of internal controls over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and the related rules and regulations of the SEC and the Public Company Accounting Oversight Board; prepare and distribute periodic reports in compliance with CB’s obligations under the federal securities laws; establish new internal policies, principally those relating to disclosure controls and procedures and corporate governance; institute a more comprehensive compliance function; and involve to a greater degree CB’s outside legal counsel and accountants in the above activities.

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CB is in the process of evaluating its internal control systems to allow management to report on its internal controls over financial reporting. CB plans to perform the system and process evaluation and testing (and any necessary remediation) required to comply with the management certification requirements of Section 404 of the Sarbanes-Oxley Act. CB will be required to comply with Section 404 in its annual report for the year ending December 31, 2014. However, CB cannot be certain as to the timing of completion of its evaluation, testing and remediation actions or the impact of the same on its operations. Furthermore, upon completion of this process, CB may identify control deficiencies of varying degrees of severity under applicable SEC and Public Company Accounting Oversight Board rules and regulations that remain unremediated.

If CB fails to implement the requirements of Section 404 in a timely manner, CB might be subject to sanctions or investigation by regulatory agencies such as the SEC. In addition, failure to comply with Section 404 or the report by CB of a material weakness may cause investors to lose confidence in its financial statements or the trading price of its common stock to decline. If CB fails to remediate any material weakness, CB’s financial statements may be inaccurate, its access to the capital markets may be restricted and the trading price of its common stock may decline.

As a public company, CB will be required to report, among other things, control deficiencies that constitute a “material weakness” or changes in internal controls that materially affect, or are reasonably likely to materially affect, internal controls over financial reporting. A “control deficiency” exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A “significant deficiency” is a control deficiency, or combination of control deficiencies, that adversely affects the ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles that results in more than a remote likelihood that a misstatement of financial statements that is more than inconsequential will not be prevented or detected. A “material weakness” is a significant deficiency, or a combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

CB is an emerging growth company within the meaning of the Securities Act, and if it decides to take advantage of certain exemptions from various reporting requirements applicable to emerging growth companies, its common stock could be less attractive to investors.

CB is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as modified by the JOBS Act. CB is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, reduced disclosure about CB’s executive compensation and omission of compensation discussion and analysis, and an exemption from the requirement of holding a non-binding advisory vote on executive compensation. In addition, CB will not be subject to certain requirements of Section 404 of the Sarbanes Oxley Act, including the additional level of review of its internal control over financial reporting that may occur when outside auditors attest to its internal control over financial reporting. As a result, CB’s stockholders may not have access to certain information they may deem important. Taking advantage of any of these exemptions may adversely affect the value and trading price of CB’s common stock. For additional information on CB’s status as an emerging growth company, see “Supervision and Regulation—Emerging Growth Company Status.”

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this document that are not historical facts may constitute forward-looking statements. The sections of this document which contain forward-looking statements include, but are not limited to, “Questions And Answers About the Merger and the Special Meeting,” “Summary,” “Risk Factors,” “Description of the Merger—Background of the Merger,” “Description of the Merger—CB’s Reasons for the Merger,” “Description of the Merger—FedFirst’s Reasons for the Merger and Recommendation of the Board of Directors” and “Description of the Merger—CB and FedFirst Unaudited Prospectus Financial Information.” You can identify these statements from the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target” and similar expressions.

These forward-looking statements are subject to significant risks, assumptions and uncertainties, including among other things, changes in general economic and business conditions and the risks and other factors set forth in the “Risk Factors” section.

Because of these and other uncertainties, CB’s actual results, performance or achievements, or industry results, may be materially different from the results indicated by these forward-looking statements. In addition, you should not assume that CB’s and FedFirst’s combined future results will reflect the past results of operations of either entity. You should not place undue reliance on any forward-looking statements, which speak only as of the dates on which they were made. CB undertakes no obligation to update these forward-looking statements, even though circumstances may change in the future, except as required under federal securities law. CB qualifies all of its forward-looking statements by these cautionary statements.

Further information on other factors which could affect the financial condition, results of operations, liquidity or capital resources of CB before and after the merger is included in this proxy statement/prospectus under “Information About CB—Business” and “Information About CB—Management’s Discussion and Analysis and Results of Operations.”

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SELECTED HISTORICAL FINANCIAL INFORMATION

The following tables show summarized historical consolidated financial data for CB. You should read this summary financial information in connection with CB’s consolidated financial statements, which appear elsewhere in this document.

The selected historical consolidated financial data for CB as of December 31, 2013 and 2012 and for the years ended December 31, 2011, 2012 and 2013 is derived from CB’s audited consolidated financial statements that are included in this document. The selected historical financial data for CB as of March 31, 2014 and for the three months ended March 31, 2014 and 2013 is derived from CB’s unaudited consolidated financial statements, which include only normal, recurring adjustments necessary to fairly present the data for those periods. The unaudited data is not necessarily indicative of expected results for any future period.

Selected Historical Consolidated Financial Data of CB

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Selected Historical Consolidated Financial Data of FedFirst

The following tables show summarized historical consolidated financial data for FedFirst. You should read this summary financial information in connection with FedFirst’s consolidated financial statements, which appear elsewhere in this document.

The selected historical consolidated financial data for FedFirst as of December 31, 2013 and 2012 and for the years ended December 31, 2011, 2012 and 2013 is derived from FedFirst’s audited consolidated financial statements that are included in this document. The selected historical financial data for FedFirst as of March 31, 2014 and for the three months ended March 31, 2014 and 2013 is derived from FedFirst’s unaudited consolidated financial statements, which include only normal, recurring adjustments necessary to fairly present the data for those periods. The unaudited data is not necessarily indicative of expected results for any future period.

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SUMMARY SELECTED PRO FORMA CONDENSED COMBINED DATA

The following table shows selected financial information on a pro forma combined basis giving effect to the merger (which is known as “pro forma” information) as if the merger had become effective as of the date presented, in the case of the balance sheet information, and at the beginning of the period presented, in the case of the income statement information. The pro forma information reflects the acquisition method of accounting.

CB anticipates that the merger will provide the combined company with financial benefits that include reduced operating expenses and greater revenue. The pro forma information, while helpful in illustrating the financial characteristics of CB following the merger under one set of assumptions, does not reflect these benefits and, accordingly, does not attempt to predict or suggest future results. The pro forma information also does not necessarily reflect what the historical results of CB would have been had its companies been combined during these periods.

The exchange ratio of 1.1590 was used in preparing this selected pro forma information. You should read this summary pro forma information in conjunction with the information under “Pro Forma Financial Information” and with the historical information in this document on which it is based.

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COMPARATIVE PER SHARE DATA

The following table shows information about CB’s and FedFirst’s respective income per common share, dividends per share and book value per share, and similar information giving effect to the merger. In presenting the comparative pro forma information for the time periods shown, we assumed that the merger occurred as of the date presented, in the case of the book value per share information, and the beginning of the period presented, in the case of the dividend and income (loss) information. See “Pro Forma Financial Information.”

The information listed as “per equivalent FedFirst share” was obtained by multiplying the pro forma amounts by the exchange ratio of 1.1590, and does not reflect the receipt of cash by holders of FedFirst common stock. CB anticipates that the merger will provide the combined company with financial benefits that include reduced operating expenses and greater revenue. The pro forma information, while helpful in illustrating the financial characteristics of CB following the merger under one set of assumptions, does not reflect these benefits and, accordingly, does not attempt to predict or suggest future results. The pro forma information also does not necessarily reflect what the historical results of CB would have been had its companies been combined during these periods.

The information in the following table is based on, and should be read together with, the historical financial information that we have presented in this document. See “Pro Forma Financial Information.”