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):
June 26, 2017
Entegra Financial Corp.
(Exact Name of Registrant as Specified in its
Charter)
North Carolina
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001-35302
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45-2460660
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(State or Other Jurisdiction of
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(Commission File Number)
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(IRS Employer
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Incorporation)
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Identification Number)
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14 One Center Court
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Franklin, North Carolina
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28734
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(Address of Principal Executive Offices)
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(Zip Code)
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(828) 524-7000
(Registrant’s telephone number, including
area code)
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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act
of 1934 (17 CFR §240.12b-2).
Emerging growth company
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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.
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Item 1.01 Entry
into a Material Definitive Agreement.
On June 26, 2017, Entegra
Financial Corp. (“Entegra”), the holding company for Entegra Bank, Franklin, North Carolina, entered into an Agreement
and Plan of Merger and Reorganization (the “Merger Agreement”) with Chattohoochee Bank of Georgia, Gainsville, Georgia
(“Chattahoochee”). Under the Merger Agreement, Chattahoochee will merge with and into Entegra Bank (the “Merger”).
The aggregate merger consideration has a total current value of approximately $34.9 million, or $14.75 per share.
Subject to the terms
and conditions of the Merger Agreement, Chattahoochee’s shareholders will have the right to receive cash in the amount
of $14.75, shares of Entegra common stock, or a combination thereof, for each share of Chattahoochee common stock. The number
of shares of Entegra common stock to be exchanged for each share of Chattahoochee common stock will be determined by dividing
$14.75 by the 20-day average closing sales price per share of Entegra common stock ending on the trading day prior to the
closing of the Merger, but in no event more than 0.7079 shares of Entegra common stock or less than 0.5792 shares of Entegra
common stock for each share of Chattahoochee common stock. The total merger consideration will be prorated as necessary to
ensure that 70% of the total outstanding shares of Chattahoochee common stock will be exchanged for cash, and 30% of the
total outstanding shares of Chattahoochee common stock will be exchanged for shares of Entegra common stock. Additionally, at
closing each outstanding and unexercised option or warrant to acquire shares of Chattahoochee common stock, whether or not
previously vested, will be cancelled in exchange for a cash payment of $14.75 minus the exercise price for each Chattahoochee
share subject to such option or warrant.
The Merger Agreement has
been unanimously approved by the boards of directors of each of Entegra, Entegra Bank and Chattahoochee. The closing of the Merger
is subject to the approval of Chattahoochee’s shareholders, requisite regulatory approvals, the effectiveness of a registration
statement to be filed by Entegra with respect to the shares of Entegra common stock to be issued in the Merger, and other customary
closing conditions. The parties anticipate closing the Merger during the fourth quarter of 2017.
In connection with entering
into the Merger Agreement, each of the directors and executive officers of Chattahoochee has entered into a voting and support
agreement (collectively, the “Support Agreements”). The Support Agreements generally require that each Chattahoochee
director and executive officer votes all of his or her shares of Chattahoochee common stock in favor of the Merger and against
alternative transactions, and generally prohibits the solicitation of an alternative transaction or the transfer of such shareholder’s
shares of Chattahoochee common stock prior to the consummation of the Merger. The Support Agreements will terminate upon the earliest
of the consummation of the Merger, in the event the Chattahoochee board of directors fails to recommend approval of the Merger
Agreement to its shareholders, or upon the termination of the Merger Agreement in accordance with its terms.
The Merger Agreement may
be terminated in certain circumstances, including: (i) by mutual written agreement of the parties; (ii) by either party in the
event of a breach by the other party of any representation, warranty, covenant, or other agreement contained in the Merger Agreement
which has not been cured within 30 days and where such breach is reasonably likely to permit such party to refuse to consummate
the Merger; (iii) by either party in the event that any consent of any required regulatory authority is denied by final action
or any law or order prohibiting the Merger becomes final and nonappealable; (iv) by either party if the required Chattahoochee
shareholder approval is not obtained; (v) by either party in the event that the Merger is not consummated by March 31, 2018; (vi)
by Entegra in the event that the Chattahoochee board of directors fails to recommend approval of the Merger Agreement to its shareholders;
or (vii) by Chattahoochee, prior to Chattahoochee shareholder approval, in order to enter into a superior proposal. Upon termination
of the Merger Agreement, under certain circumstances Chattahoochee may be required to pay Entegra a termination fee of $1.4 million.
The foregoing description
of the Merger Agreement and the Support Agreements does not purport to be complete and is qualified in its entirety by reference
to the full text of the Merger Agreement and the Support Agreements, which are attached hereto as Exhibit 2.1 and are incorporated
herein by reference. The related joint press release is attached hereto as Exhibit 99.1 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 disclosure memoranda made for the purposes of allocating
contractual risk between the parties to the Merger Agreement 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 (i) will not
survive consummation of the Merger, unless otherwise specified therein, and (ii) 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 Entegra or Chattahoochee, 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 Entegra, Chattahoochee,
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 Chattahoochee and a prospectus
of Entegra, as well as in the Form 10-K, Forms 10-Q, Forms 8-K and other filings that Entegra makes with the Securities and Exchange
Commission (“SEC”).
Item 8.01 Other Events.
Also on June 27, 2017,
Entegra and Chattahoochee issued a joint press release announcing the execution of the Merger Agreement. A copy of the joint press
release is attached hereto as Exhibit 99.1.
Item 9.01 Financial
Statements and Exhibits.
(d) Exhibits
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Exhibit No.
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Description
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2.1
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Agreement and Plan of Merger and Reorganization, dated June 26, 2017, by and among Entegra Financial Corp., Entegra Bank and Chattahoochee Bank of Georgia.
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99.1
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Joint Press Release dated June 27, 2017, announcing the Merger Agreement.
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FORWARD-LOOKING STATEMENTS
This
Current Report may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform
Act of 1995, including Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. Such statements
involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Any statements
that are not statements of historical fact may be deemed to be “forward-looking statements.” Such statements are often
characterized by the use of qualifying words such as “expects,” “anticipates,” “believes,”
“estimates,” “plans,” “projects,” or other statements concerning opinions or judgments of Entegra
and its management about future events.
Such
forward-looking statements include, but are not limited to, statements about the benefits of the combination of Entegra and Chattahoochee,
including future financial and operating results, expected cost savings, expected impact on future earnings, the combined bank’s
plans, objectives, expectations and intentions and other statements that are not historical facts. These 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 and you are cautioned not to place undue reliance on any forward-looking statements. We assume no duty to
update forward-looking statements.
In
addition to factors previously disclosed in Entegra’s reports filed with the SEC, the following factors among others,
could cause actual results to differ materially from forward-looking statements: ability to obtain regulatory approvals and meet
other closing conditions to the acquisition, including approval by Chattahoochee’s shareholders, on the expected terms and
schedule; delay in closing the acquisition; difficulties and delays in integrating the Entegra and Chattahoochee businesses or
fully realizing cost savings and other benefits; business disruption following the proposed transaction; changes in asset quality
and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation;
customer borrowing, repayment, investment and deposit practices; the introduction, withdrawal, success and timing of business initiatives;
competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences
associated with mergers, acquisitions and divestitures; economic conditions; the reaction to the transaction of the banks’
customers, employees and counterparties; and the impact, extent and timing of technological changes, capital management activities,
and other actions of the Board of Governors of the Federal Reserve and legislative and regulatory actions and reforms.
ADDITIONAL INFORMATION ABOUT THE PROPOSED
TRANSACTION AND WHERE TO FIND IT
This Current Report
is being made in respect of the proposed transaction involving Entegra and Chattahoochee. This material is
not a solicitation of any vote or approval of Chattahoochee’s shareholders and is not a substitute for the proxy
statement/prospectus or any other documents which and Chattahoochee may send in connection with the proposed merger. This
communication does not constitute an offer to sell or the solicitation of an offer to buy any securities.
In connection
with the proposed acquisition, Entegra will file with the SEC a registration statement on Form S-4 to register the shares of Entegra
common stock to be issued to the shareholders of Chattahoochee. The registration statement will include a proxy statement/prospectus
which will be sent to the shareholders of Chattahoochee seeking their approval of the acquisition and related matters. In addition,
Entegra may file other relevant documents concerning the proposed acquisition with the SEC.
INVESTORS
AND SHAREHOLDERS OF CHATTAHOOCHEE ARE URGED TO READ THE REGISTRATION STATEMENT ON FORM S-4 AND THE PROXY STATEMENT/PROSPECTUS INCLUDED
WITHIN THE REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED ACQUISITION
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT ENTEGRA, CHATTAHOOCHEE AND THE PROPOSED TRANSACTION.
Investors
and shareholders may obtain free copies of these documents, when filed, through the website maintained by the SEC at www.sec.gov.
Free copies of the proxy statement/prospectus also may be obtained, when available, by directing a request by telephone or mail
to Entegra Financial Corp., 14 One Center Court, Franklin, North Carolina 28734, Attention: David Bright (telephone: (828) 524-7000),
or Chattahoochee Bank of Georgia, 643 E E Butler Parkway, Gainesville, Georgia 30503, Attention: Investor Relations (telephone:
(770) 536-0607), or by accessing Entegra’s website at www.entegrabank.com under “Investor Relations.” The information on Entegra’s and Chattahoochee’s websites is not, and shall not be
deemed to be, a part of this Current Report or incorporated into other filings either company makes with the SEC.
Chattahoochee
and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders
of Chattahoochee in connection with the acquisition. Information about the directors and executive officers of Chattahoochee is
set forth in the proxy statement for Chattahoochee’s 2017 annual meeting of shareholders. Additional information regarding the
interests of these participants and other persons who may be deemed participants in the proxy solicitation may be obtained by reading
the proxy statement/prospectus when it becomes available.
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
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ENTEGRA FINANCIAL CORP.
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By:
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/s/ David A. Bright
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David A. Bright
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Chief Financial Officer
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Date: June 27, 2017
INDEX TO EXHIBITS
Exhibit No.
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Description
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2.1
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Agreement and Plan of Merger and Reorganization, dated June 26, 2017, by and among Entegra Financial Corp., Entegra Bank and Chattahoochee Bank of Georgia.
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99.1
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Joint Press Release dated June 27, 2017 announcing the Merger Agreement.
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