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Item 1.01
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Entry Into a Material Definitive Agreement
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Agreement and Plan of Merger
On August 12, 2017, Sunshine Bancorp, Inc. (“Sunshine”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with
CenterState Banks, Inc. (“CenterState”), whereby Sunshine will be merged with and into CenterState (the “Merger”). Pursuant to and simultaneously with entering into the Merger Agreement, CenterState’s wholly owned subsidiary
bank, CenterState Bank, N.A. (“CenterState Bank”), and Sunshine’s wholly owned subsidiary bank, Sunshine Bank, entered into a Plan of Merger and Merger Agreement whereby Sunshine Bank will be merged with and into CenterState Bank
immediately following the merger of Sunshine with and into CenterState.
Under the terms and subject to the conditions of the Merger Agreement, each
outstanding share of Sunshine common stock is entitled to receive 0.89 shares of CenterState common stock. Pursuant to the Merger Agreement, each Sunshine stock option that is outstanding will become fully vested and represent the right to purchase
shares of CenterState common stock equal to the number of shares subject to such Sunshine stock option multiplied by 0.89, and at an exercise price equal to the exercise price per share of the Sunshine stock option divided by 0.89.
The Merger Agreement has been unanimously approved by the boards of directors of CenterState and Sunshine. The transaction is expected to close early in the
first quarter of 2018 subject to customary conditions, including receipt of all applicable regulatory approvals and Sunshine stockholder approval.
The
Merger Agreement contains usual and customary representations and warranties that CenterState and Sunshine made to each other as of specific dates. Each party has also agreed to customary covenants, including, among others, covenants relating to the
conduct of its business during the interim period between the execution of the Merger Agreement and the consummation of the Merger.
The Merger Agreement
provides certain termination rights for both Sunshine and CenterState and further provides that a termination fee of $7.07 million will be payable by Sunshine to CenterState, as applicable, upon termination of the Merger Agreement under certain
circumstances. Sunshine may also terminate the Merger Agreement in the event of a decline in CenterState’s stock price from the date of the Merger Agreement and as measured against a bank index over the period from the date of the Merger
Agreement to the later to occur of Sunshine stockholders’ approval or receipt of the last regulatory approval required for the Merger provided that CenterState determines not to increase the merger consideration to be received by Sunshine
stockholders as provided for in the Merger Agreement.
Completion of the Merger is subject to a number of customary conditions, including, among others,
(1) the approval of the Merger Agreement by the stockholders of Sunshine, (2) the effectiveness of the registration statement to be filed by CenterState with the Securities and Exchange Commission (the “SEC”) relating to the
CenterState common stock to be issued in the Merger, (3) approval of the listing on The Nasdaq Stock Market of the shares of CenterState common stock to be issued in the Merger, (4) the absence of any order or other legal restriction
prohibiting the closing of the Merger, (5) receipt of required regulatory approvals without the imposition of any burdensome condition (as such term is defined in the Merger Agreement), (6) subject to certain exceptions, the accuracy of
the representations and warranties of the other party, (7) performance in all material respects by the other party of its obligations under the Merger Agreement, (8) the absence of any material adverse effect (as such term is defined in
the Merger Agreement) with respect to the other party, and (9) 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.
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The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its
entirety by reference to the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated into this report 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 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 (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 Sunshine or
CenterState, 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 Sunshine, CenterState, their respective affiliates
or their respective businesses, that will be contained in, or incorporated by reference into, the registration statement on Form S-4 that will include a proxy statement of Sunshine and a prospectus of CenterState, as well as in the Forms 10-K, Forms
10-Q, Forms 8-K and other filings that each of Sunshine and CenterState make with the SEC.
Voting Agreements
In connection with entering into the Merger Agreement, each of the directors of Sunshine has entered into a voting agreement (collectively, the “Voting
Agreements”). The Voting Agreements generally require that the stockholder party thereto vote all of his or her shares of Sunshine common stock in favor of the Sunshine Merger and against alternative transactions and generally prohibit such
stockholder from transferring his or her shares of Sunshine common stock prior to the consummation of the Merger. The Voting Agreements will terminate upon the earlier of the consummation of the Merger or the termination of the Merger Agreement in
accordance with its terms.
The foregoing summary of the Voting Agreements is qualified in its entirety by reference to the complete text of the Voting
Agreements, a form of which is included as Exhibit A to the Merger Agreement, filed as Exhibit 2.1 attached hereto and that is incorporated herein by reference.
Non-Compete Agreements
Simultaneously with the execution
of the Merger Agreement, each of the Sunshine directors entered into a Non-Competition and Non-Disclosure Agreement, which contains provisions related to non-disclosure of confidential information (12 months), non-recruitment of employees,
non-solicitation of customers, and non-competition for a period of two years following the completion of the Merger.
The foregoing summary of the
Non-Competition and Non-Disclosure Agreement is qualified in its entirety by reference to the complete text of such document, a form of which is included as Exhibit C to the Merger Agreement, filed as Exhibit 2.1 attached hereto and which is
incorporated herein by reference.
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Additionally, Andrew Samuel, President and Chief Executive Officer of Sunshine, entered into a Non-Competition
and Non-Disclosure Agreement with CenterState that will be effective upon the consummation of the Merger. Mr. Samuel’s Non-Competition and Non-Disclosure Agreement restricts him for a period of two years from the consummation of the
Merger, from: (1) engaging in a competing business within 35 miles of any location in which Sunshine or Sunshine Bank has a branch or business office immediately prior to the closing of the Merger; (2) soliciting any CenterState or
Sunshine customer or (3) soliciting any CenterState or Sunshine employee.
The foregoing summary of Mr. Samuel’s Non-Competition and
Non-Disclosure Agreement is qualified in its entirety by reference to the complete text of such document attached hereto as Exhibit 10.1 and incorporated herein by reference.