FIRT CHOINPV Item 1.01 Entry into a Material Definitive Agreement
Merger Agreement
On
A copy of the Merger Agreement is attached as Exhibit 2.1 to this Current Report on Form 8-K. A summary of the Merger Agreement's material terms follows.
Merger Consideration
Stock Consideration. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger each share of First Choice common stock outstanding immediately prior to the effective time will be converted into the right to receive 0.6603 (the "Exchange Ratio") shares of Enterprise common stock, as well as cash in lieu of fractional shares of Enterprise common stock. The shares of Enterprise common stock issuable and cash in lieu of fractional shares payable to First Choice shareholders is referred to as the stock consideration. If pre-closing environmental reviews of First Choice's real estate result in estimated remediation costs in excess of a specified threshold, then Enterprise may elect to adjust the exchange ratio to account for those costs.
First Choice Options. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, (a) each unvested option to acquire shares of First Choice common stock (each, a "First Choice Option") will vest or be forfeited, as the case may be, pursuant to the terms of the First Choice benefit plan and/or award agreement, and (b) each vested and outstanding First Choice Option to acquire shares of First Choice common stock (each, a "First Choice Option") granted under any First Choice benefit plan and/or award agreement will be canceled and extinguished and exchanged for the right to receive (without interest) an amount of cash equal to the product of (i) the aggregate number of shares of First Choice common stock issuable upon exercise of such First Choice Option and (ii) the excess, if any, of (A) the product of (x) the Exchange Ratio and (y) the daily volume weighted average price of Enterprise's common stock for the 20 consecutive trading days ending on the trading day immediately preceding the closing date of the Merger, over (B) the per-share exercise price of such First Choice Option, less any applicable taxes required to be withheld with respect to such cash payment.
Other First Choice Stock-Based Awards. Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, each award of First Choice restricted stock units and other stock-based awards granted by First Choice that is then unsettled or unvested will vest or be cancelled, as the case may be, pursuant to the terms of the applicable stock plan and/or award agreement.
Appointment of Enterprise Director
In the Merger Agreement, Enterprise is required to take all action necessary to
appoint or elect, effective as of the effective time of the Merger, one current
First Choice director as a director of Enterprise. The selected First Choice
director must be independent with respect to Enterprise for purposes of Nasdaq's
listing requirements and mutually agreeable to Enterprise and First Choice.
Enterprise and First Choice have determined that
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Representations, Warranties and Covenants
The Merger Agreement contains customary representations, warranties and covenants from each of First Choice, FCB, Enterprise and EB&T relating to their respective companies, subsidiaries, businesses and matters related to the Merger.
Among other covenants, First Choice and Enterprise have agreed: (a) to convene and hold a meeting of their respective shareholders to consider and vote upon the Merger Agreement, and (b) that, subject to certain exceptions, each of the board of directors of First Choice and Enterprise will recommend the approval of the Merger and the Merger Agreement by their respective shareholders.
First Choice has agreed not to solicit alternative third-party acquisition proposals or, subject to certain exceptions, conduct discussions concerning or provide confidential information in connection with any alternative third-party acquisition proposal.
The Merger Agreement contains representations and warranties that First Choice, FCB, Enterprise and EB&T made to and solely for the benefit of each other. These representations and warranties are subject to materiality standards which may differ from what may be viewed as material by investors and shareholders, and, in certain cases, were used for the purpose of allocating risk among the parties rather than establishing matters as facts. The assertions embodied in those representations and warranties also are qualified by information in confidential disclosure schedules that the parties have exchanged when signing the Merger Agreement. The disclosure schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties in the Merger Agreement. Accordingly, shareholders of First Choice or Enterprise should not rely on the representations and warranties as characterizations of the actual state of facts or condition of Enterprise or First Choice, since they were only made as of the date of the Merger Agreement and are modified in important part by the underlying disclosure schedules. Moreover, information concerning the subject matter of the representations and warranties may have changed since the date of the Merger Agreement, which subsequent information may or may not be fully reflected in Enterprise's or First Choice's public disclosures.
Conditions to Closing
The completion of the Merger is subject to various closing conditions, which include, among others:
? approval of the Merger Agreement and the transactions contemplated by the
Merger Agreement by First Choice's shareholders and Enterprise's shareholders;
? the receipt of all required regulatory approvals or authorizations, provided
that none of these approvals contain any prohibition, limitation, or other
requirement which would (a) materially prohibit or materially limit the
ownership or operation by Enterprise or any subsidiary of Enterprise
(including First Choice and FCB after closing of the Merger) of all or any
material portion of its business or assets, (b) compel Enterprise or any
subsidiary of Enterprise (including First Choice and FCB after closing of the
Merger) to dispose of all or any material portion of its business or assets,
(c) cause any portion of any First Choice regulatory agreement to be
enforceable against Enterprise or EB&T after the Merger, or (d) be reasonably
expected to have a material adverse effect on Enterprise, taken as a whole,
after giving effect to the Merger;
? the accuracy of the representations and warranties of the parties set forth in
the Merger Agreement subject to the standards set forth in the Merger
Agreement;
? the material performance of all obligations under the Merger Agreement to be
performed prior to the closing of the Merger;
? the absence of any law, injunction, order, judgment or decree enacted, entered
into, promulgated or enforced by any governmental authority prohibiting or
making illegal completion of any of the transactions contemplated by the
Merger Agreement;
? the effective registration of the shares of Enterprise common stock to be
issued to First Choice shareholders with the
Commission (the "SEC"), and the approval of such shares for listing on the
Nasdaq Global Select Market; and
? the receipt by each 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.
3 Termination
The Merger Agreement contains certain termination rights for both Enterprise and
First Choice, including if (a) the Merger is not consummated by
Item 8.01 Other Events
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Forward-Looking Statements
Certain statements contained in this Current Report on Form 8-K may be
considered forward-looking statements regarding First Choice, FCB, Enterprise
and EB&T and Enterprise's proposed acquisition of First Choice and FCB. These
forward-looking statements may include: statements regarding the acquisition,
the consideration payable in connection with the acquisition, and the ability of
the parties to consummate the acquisition. Forward-looking statements are
typically identified by words such as "believe," "expect," "anticipate,"
"intend," "outlook," "estimate," "forecast," "project," "pro forma" and other
similar words and expressions. Forward-looking statements are subject to
numerous assumptions, risks and uncertainties, which change over time.
Forward-looking statements speak only as of the date they are made. Because
forward-looking statements are subject to assumptions and uncertainties, actual
results or future events could differ, possibly materially, from those that
First Choice anticipated in its forward-looking statements and future results
could differ materially from historical performance. Factors that could cause or
contribute to such differences include, but are not limited to, the possibility:
that expected benefits of the acquisition may not materialize in the timeframe
expected or at all, or may be more costly to achieve; that the acquisition may
not be timely completed, if at all; the occurrence of any event, change or other
circumstances that could give rise to the right of one or both of the parties to
terminate the definitive transaction agreement; the outcome of any legal
proceedings that may be instituted against First Choice or Enterprise; that
prior to the completion of the acquisition or thereafter, First Choice's and
Enterprise's respective businesses may not perform as expected due to
transaction-related uncertainty or other factors; that the parties are unable to
successfully implement integration strategies; that required regulatory, First
Choice shareholder, Enterprise shareholder or other approvals are not obtained
or other closing conditions are not satisfied in a timely manner or at all;
adverse regulatory conditions may be imposed in connection with regulatory
approvals of the acquisition; reputational risks and the reaction of the
companies' employees or customers to the transaction; diversion of management
time on acquisition-related issues; that the COVID-19 pandemic, including
uncertainty and volatility in financial, commodities and other markets, and
disruptions to banking and other financial activity, could harm First Choice's
and Enterprise's business, financial position and results of operations, and
could adversely affect the timing and anticipated benefits of the proposed
acquisition; and those factors and risks referenced from time to time in First
Choice's filings with the
Except to the extent required by applicable law or regulation, First Choice disclaims any obligation to revise or publicly release any revision or update to any of the forward-looking statements included herein to reflect events or circumstances that occur after the date on which such statements were made.
Additional Information About the Merger and Where to Find It
In connection with the proposed acquisition transaction, Enterprise will file
with the
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The final joint proxy statement/prospectus will be mailed to First Choice's and
Enterprise's shareholders. Investors and security holders will be able to obtain
the documents, and any other documents Enterprise has filed with the
Participants in Solicitation
First Choice and certain of their directors and executive officers, and
Enterprise and certain of their directors, executive officers and other certain
members of management and employees, may be deemed to be participants in the
solicitation of proxies from the shareholders of First Choice and the
shareholders of Enterprise in connection with the Merger. Information about the
directors and executive officers of Enterprise is set forth in the proxy
statement for Enterprise's 2021 annual meeting of shareholders, as filed with
the
Item 9.01. Financial Statements and Exhibits
(d) Exhibits Exhibit No. Description 2.1* Agreement and Plan of Merger, dated as ofApril 26, 2021 , by and amongFirst Choice Bancorp ,First Choice Bank , Enterprise Financial Services Corp, andEnterprise Bank & Trust . 99.1 Joint Press Release, datedApril 26, 2021 .
* Certain schedules to this agreement have been omitted pursuant to Item
601(b)(2) of Regulation S-K and First Choice agrees to furnish supplemental to
the
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