Item 1.01 Entry into a Material Definitive Agreement
Merger Agreement
On
At the Effective Time, each outstanding option granted by SB One to purchase
shares of SB One Common Stock under the SB One stock incentive plans (the "SB
One Options"), whether vested or unvested, will be cancelled and converted
automatically into the right to receive an amount of cash equal to the product
of (i) the excess of (A) the product of (x) the Exchange Ratio and (y) the
Provident Closing Price (as defined below), over (B) the exercise price of such
SB One Option, and (ii) the number of shares of SB One Common Stock subject to
said SB One Option (whether vested or unvested). The Provident Closing Price
means the average of the closing sales price of a share of Provident Common
Stock, as reported on the
Furthermore, at the Effective Time, each share of SB One restricted stock, whether vested or unvested, will be cancelled and converted automatically into the right to receive the Merger Consideration.
Following the Merger,
At the Effective Time, Provident will appoint
The Merger Agreement contains customary representations and warranties from each of SB One and Provident, and each party has agreed to customary covenants, including, among others, covenants relating to the conduct of SB One's and Provident's businesses during the interim period between the execution of the Merger Agreement and the Effective Time and, in the case of SB One, its obligation to call a meeting of its shareholders to adopt the Merger Agreement, its obligation, subject to certain exceptions, to recommend that its stockholders approve the Merger Agreement and the Merger, and its non-solicitation obligations relating to alternative acquisition proposals.
The completion of the Merger is subject to customary conditions, including, among others, (1) the approval of the Merger by the holders of SB One Common Stock, (2) authorization for listing on the NYSE of the shares of Provident Common Stock to be issued in the Merger, (3) the effectiveness of the registration statement on Form S-4 for the Provident Common Stock to be issued in the Merger, (4) the absence of any order, decree or injunction preventing the completion of the Merger and (5) the receipt or waiver of required regulatory approvals. Each party's obligation to complete the Merger is also subject to certain additional customary conditions, including (i) subject to certain exceptions, the accuracy of the representations and warranties of the other party, (ii) performance in all material respects by the other party of its obligations under the Merger Agreement and (iii) receipt by such party of an opinion from its counsel to the effect that the Merger will qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended.
The Merger Agreement provides certain termination rights for both SB One and
Provident and further provides that a termination fee of
The Merger Agreement was unanimously approved by the boards of both SB One and Provident.
The foregoing description of the Merger Agreement does not purport to be
complete and is qualified in its entirety by reference to the full text of the
Merger Agreement, which is attached hereto as Exhibit 2.1 and is incorporated
herein by reference. The representations, warranties and covenants of each party
set forth in the Merger Agreement have been made only for purposes of, and were
and are solely for the benefit of the parties to, the Merger Agreement, may be
subject to limitations agreed upon by the contracting parties, including being
qualified by confidential disclosures made for the purposes of allocating
contractual risk between SB One and Provident instead of establishing these
matters as facts, and may be subject to standards of materiality applicable to
the contracting parties that differ from those applicable to investors.
Accordingly, the representations and warranties may not describe the actual
state of affairs at the date they were made or at any other time, and investors
should not rely on them as statements of fact. In addition, such representations
and warranties (1) will not survive consummation of the Merger, unless otherwise
specified therein, and (2) were made only as of the date of the Merger Agreement
or such other date as is specified in the Merger Agreement. Moreover,
information concerning the subject matter of the representations and warranties
may change after the date of the Merger Agreement, which subsequent information
may or may not be fully reflected in the parties' public disclosures.
Accordingly, the Merger Agreement is included with this filing only to provide
investors with information regarding the terms of the Merger Agreement, and not
to provide investors with any other factual information regarding SB One or
Provident, their respective affiliates or their respective businesses. The
Merger Agreement should not be read alone, but should instead be read in
conjunction with the other information regarding SB One, Provident, their
respective affiliates or their respective businesses, the Merger Agreement and
the Merger that will be contained in, or incorporated by reference into, the
Registration Statement on Form S-4 that will include a proxy statement of SB One
and a prospectus of Provident, as well as in the Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and other filings that each of SB One
and Provident make with the
Voting Agreement
In connection with the Merger Agreement, in their capacity as shareholders of SB One, SB One's directors and certain executive officers entered into Voting Agreements with Provident (the "Voting Agreements"). The SB One directors and executive officers that are party to the Voting Agreements beneficially own, in the aggregate, approximately 14.93% of the outstanding shares of SB One Common Stock. The Voting Agreements require, among other things, that the SB One shareholder that is party thereto vote his or her shares of SB One Common Stock in favor of the Merger and the other transactions contemplated by the Merger Agreement and against alternative transactions and not to, directly or indirectly, assign, sell, transfer or otherwise dispose of his or her shares of SB One Common Stock, subject to certain exceptions.
The foregoing description of the Voting Agreements does not purport to be complete and is qualified in its entirety by reference to the form of Voting Agreement, which is attached to this Current Report as Exhibit 10.1, and incorporated by reference herein.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On
The Settlement Agreement terminates
The foregoing description of the Settlement Agreement is not complete and is qualified in its entirety by references to the Settlement Agreement, which is filed as Exhibit 10.2 and incorporated herein by reference.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about (i) the benefits of the Merger, including future financial and operating results, cost savings enhancements to revenue and accretion to reported earnings that may be realized from the Merger; (ii) SB One's and Provident's plans, objectives, expectations and intentions and other statements contained in this Current Report on Form 8-K that are not historical facts; and (iii) other statements identified by words such as "expects" "anticipates," "intends," "plans," "believes," "seeks," "estimates," "targets," "projects," or words of similar meaning generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of the respective managements of SB One and Provident and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of SB One and Provident. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the anticipated results discussed in these forward-looking statements because of possible uncertainties.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectations expressed in the
forward-looking statements: (1) the businesses of SB One and Provident may not
be combined successfully, or such combination may take longer, be more
difficult, time-consuming or costly to accomplish than expected; (2) the
expected growth opportunities or cost savings from the Merger may not be fully
realized or may take longer to realize than expected; (3) deposit attrition,
operating costs, customer losses and business disruption following the Merger,
including adverse effects on relationships with employees and customers, may be
greater than expected; (4) the regulatory approvals required for the Merger may
not be obtained on the proposed terms or on the anticipated schedule; (5) the
shareholders of SB One may fail to approve the Merger; (6) legislative or
regulatory changes, including changes in accounting standards, may adversely
affect the businesses in which SB One and Provident are engaged; (7) the
interest rate environment may further compress margins and adversely affect net
interest income; (8) results may be adversely affected by continued
diversification of assets and adverse changes to credit quality; (9) competition
from other financial services companies in SB One's and Provident's markets
could adversely affect operations; and (10) an economic slowdown could adversely
affect credit quality and loan originations. Additional factors, that could
cause actual results to differ materially from those expressed in the
forward-looking statements are discussed in SB One's and Provident's reports
(such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K) filed with the
SB One and Provident caution that the foregoing list of factors is not exhaustive. All subsequent written and oral forward-looking statements concerning the proposed transaction or other matters attributable to SB One or Provident or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. SB One and Provident do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
Important Additional Information and Where to Find It
This Current Report on Form 8-K does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the Merger. No offer of securities shall be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended, and no offer to sell or solicitation of an offer to buy shall be made in any jurisdiction in which such offer, solicitation or sale would be unlawful.
In connection with the Merger, Provident will file with the
Free copies of the Proxy Statement/Prospectus, as well as other filings
containing information about SB One and Provident, may be obtained at the
Participants in the Solicitation
SB One, Provident and their respective directors, and certain of their executive
officers and employees may be deemed to be participants in the solicitation of
proxies from the shareholders of SB One in connection with the Merger.
Information about SB One's directors and executive officers is available in its
proxy statement for its 2019 annual meeting of shareholders, which was filed
with the
Item 9.01. Financial Statements and Exhibits
(a) Financial statements of businesses acquired. None. (b) Pro forma financial information. None. (c) Shell company transactions: None. (d) Exhibits. 2.1 Agreement and Plan of Merger, datedMarch 11, 2020 , by and between Provident Financial Services, Inc. andSB One Bancorp * 10.1 Form of Voting Agreement, datedMarch 11, 2020 , by and between Provident Financial Services, Inc. and certain shareholders ofSB One Bancorp 10.2 Settlement Agreement, datedMarch 11, 2020 , by and amongSB One Bancorp ,SB One Bank , Provident Financial Services, Inc.,Provident Bank andAnthony J. Labozzetta
* Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A
copy of any omitted schedule will be furnished supplementally to the
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