8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

February 4, 2021

ORRSTOWN FINANCIAL SERVICES, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania		001-34292		23-2530374
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)
	77 East King Street,	P. O. Box 250	Shippensburg,	Pennsylvania	17257
	(Address of Principal Executive Offices)				(Zip Code)
Registrant’s Telephone Number, Including Area Code:			(717)	532-6114
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:
☐	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)).

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, no par value	ORRF	Nasdaq Stock Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☐	Emerging growth company
☐	If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 7.01    Regulation FD

On February 4, 2021, Orrstown Financial Services, Inc., issued a letter to shareholders discussing the financial results and dividend for the quarter ended December 31, 2020. A copy of the shareholder letter is attached as Exhibit 99 of this Current Report on Form 8-K and is incorporated herein by reference. This Current Report is being “furnished” pursuant to Regulation FD and no part of this Report shall be deemed “filed” for any purpose.

Item 9.01    Financial Statements and Exhibits

(d)    Exhibits

The following exhibit is furnished as part of this Current Report on Form 8-K:

Exhibit No.	Description
99	Shareholder letter dated February 4, 2021
104	Cover Page Interactive Data File (embedded within the inline XBRL document)

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.
	ORRSTOWN FINANCIAL SERVICES, INC.
Date: February 9, 2021	By:	/s/ Thomas R. Brugger
		Thomas R. Brugger Executive Vice President and Chief Financial Officer (Duly Authorized Representative)

EX-99

Exhibit 99

February 4, 2021

Dear Shareholder,

FOURTH QUARTER RESULTS

Our fourth quarter results capped a strong year, despite continued negative impacts from COVID-19. In terms of revenue, the fourth quarter was our strongest ever, resulting in $10.1 million in earnings, which represents diluted earnings per share of $0.91. Net interest income was solid due to a combination of recognizing more deferred income from Paycheck Protection Program (PPP) loans as clients achieved forgiveness under the terms of the program and we undertook measures to stabilize margin in the low interest rate environment. We were encouraged by annualized commercial loan growth, excluding PPP loans, of 13.9%. We also remain cautiously optimistic about our asset quality and believe that our conservative underwriting philosophy will position us well as we continue to deal with the ongoing economic uncertainty. Our ratio of non-performing, non-SBA loans to total non-SBA loans remains solid at 0.65%. Just as importantly, the balance of commercial loan deferrals as a result of COVID-19 fell from $78.4 million at September 30, 2020 to $18.2 million at year-end.

DIVIDEND

In January 2021, the Board of Directors declared a cash dividend of $0.18 per common share, which represents a 5.9% increase over the dividend of $0.17 per share declared in the previous quarter. Though we cannot guarantee the amount of future dividend payments in times of heightened economic uncertainty, we understand the importance of it to our shareholders, and the Company and Board are dedicated to defending the dividend. If you do not currently participate in our Dividend Reinvestment and Stock Purchase Plan (DRSPP), and wish to learn more, please contact the DRSPP administrator, Continental Stock Transfer & Trust, at 212-509-4000 or drp@continentalstock.com, for a prospectus.

COVID 19 IMPACTS

Our industry, our country, and the entire world have changed dramatically since March of 2020. COVID-19 has upended the economy, and although the initial recovery was stronger than anticipated, we still have a long way to go to reach pre-pandemic levels of employment and productivity. While the timing and trajectory of the recovery is unclear, what is certain is that Orrstown Bank continues to proudly support the clients and communities in our market, while ensuring the safety of its employees through all appropriate measures. As this letter is being mailed, our team is diligently working with clients and prospects to approve applications from this most recent release of PPP funds.

On behalf of the Board of Directors, our Leadership Team, and all who serve our clients on a daily basis, thank you for your support and continued long-term investment in Orrstown Financial Services, Inc. As we work on your behalf, we look forward to hearing from you. Should you have any questions or concerns please feel free to contact me, at 717-530-2602 or tquinn@orrstown.com or Matthew Schultheis, CFA, Director of Investor Relations at 717-510-7127 or ir@orrstown.com.

Sincerely,

Thomas R. Quinn, Jr.

President and Chief Executive Officer

About the Company

With $2.75 billion in assets, Orrstown Financial Services, Inc. and its wholly-owned subsidiary, Orrstown Bank, provide a wide range of consumer and business financial services through offices in Cumberland, Dauphin, Franklin, Lancaster, and Perry Counties, Pennsylvania and Anne Arundel, Baltimore, Howard, and Washington Counties, Maryland. Orrstown Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the FDIC. Orrstown Financial Services, Inc.’s common stock is traded on Nasdaq (ORRF). For more information about Orrstown Financial Services, Inc. and Orrstown Bank, visit www.orrstown.com.

Cautionary Note Regarding Forward-looking Statements:

This letter contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements reflect the current views of the Company's management with respect to, among other things, future events and the Company's financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about the Company's industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company's control. Accordingly, the Company cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements and there can be no assurances that the Company will be able to continue to successfully execute on our strategic growth plan into Dauphin, Lancaster, York and Berks counties, Pennsylvania, and the greater Baltimore market in Maryland, with newer markets continuing to be receptive to our community banking model; to take advantage of market disruption; to experience sustained growth in loans and deposits or maintain the momentum experienced to date from these actions; and to realize cost savings from our branch consolidation efforts. In additional to risks and uncertainties related to the COVID-19 pandemic and resulting governmental and societal responses, factors which could cause the actual results of the Company's operations to differ materially from expectations include, but are not limited to: ineffectiveness of the Company's strategic growth plan due to changes in current or future market conditions; the effects of competition and how it may impact our community banking model, including industry consolidation and development of competing financial products and services; the integration of the Company's strategic acquisitions; the inability to fully achieve expected savings, efficiencies or synergies from mergers and acquisitions, or taking longer than estimated for such savings, efficiencies and synergies to be realized; changes in laws and regulations; interest rate movements; changes in credit quality; inability to raise capital, if necessary, under favorable conditions; volatilities in the securities markets; deteriorating economic conditions; expenses associated with pending litigation and legal proceedings; and other risks and uncertainties, including those set forth under the heading "Risk Factors" in the Company's 2019 Annual Report on Form 10-K and subsequent filings. The foregoing list of factors is not exhaustive.

If one or more events related to these or other risks or uncertainties materialize, or if the Company's underlying assumptions prove to be incorrect, actual results may differ materially from what the Company anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for the Company to predict those events or how they may affect it. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that the Company or persons acting on the Company's behalf may issue.

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XML

Cover	Aug. 10, 2020
Cover [Abstract]
Document Type	8-K
Document Period End Date	Feb. 04, 2021
Entity Registrant Name	ORRSTOWN FINANCIAL SERVICES, INC.
Entity Incorporation, State or Country Code	PA
Entity File Number	001-34292
Entity Tax Identification Number	23-2530374
Entity Address, Address Line One	77 East King Street,
Entity Address, Address Line Two	P. O. Box 250
Entity Address, City or Town	Shippensburg,
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	17257
City Area Code	(717)
Local Phone Number	532-6114
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	ORRF
Security Exchange Name	NASDAQ
Entity Central Index Key	0000826154
Amendment Flag	false