ChoiceOne Financial Services, Inc. (OTCMKTS:COFS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01
On January 3, 2020, ChoiceOne Financial Services, Inc. (“ChoiceOne”) and Community Shores Bank Corporation (“Community Shores”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) providing for the merger of Community Shores with and into ChoiceOne. The Merger Agreement has been unanimously approved by the boards of directors of both ChoiceOne and Community Shores.
The Merger Agreement provides that, upon the terms and subject to the conditions set forth in the Merger Agreement, Community Shores will be merged with and into ChoiceOne, with ChoiceOne as the surviving corporation (the “Merger”). Subject to the terms and conditions of the Merger Agreement, upon completion of the Merger, each share of Community Shores common stock outstanding immediately prior to the Merger will be converted into the right to receive, at the election of each Community Shores shareholder, an amount of cash equal to $5.00 or 0.17162 shares of ChoiceOne common stock, in each case subject to the limitation that the total number of shares of Community Shores common stock to be converted into shares of ChoiceOne common stock will equal not less than 50% and not more than 75% of the total outstanding shares of Community Shores common stock as of the effective time of the Merger.
The Merger Agreement contains customary representations and warranties that the parties have made to each other as of specific dates. Except for its status as a contractual document that establishes and governs the legal relations among the parties with respect to the Merger, the Merger Agreement is not intended to be a source of factual, business or operational information about the parties. The representations and warranties contained in the Merger Agreement were made only for purposes of the Merger Agreement and as of specific dates, may be subject to a contractual standard of materiality different from what a shareholder might view as material, may have been used for purposes of allocating risk between the respective parties rather than establishing matters as facts, may have been qualified by certain disclosures not reflected in the Merger Agreement that were made to the other party in connection with the negotiation of the Merger Agreement and generally were solely for the benefit of the parties to the Merger Agreement.
The Merger Agreement contains customary covenants of ChoiceOne and Community Shores including, among others, that Community Shores shall (i) conduct its business in the ordinary course generally consistent with past practice during the period between the date of the Merger Agreement and the effective time of the Merger or earlier termination of the Merger Agreement, (ii) through its board of directors, recommend that its shareholders approve the Merger Agreement (subject to certain exceptions as provided in the Merger Agreement), (iii) call and hold a special shareholders’ meeting to approve the Merger Agreement, (iv) solicit shareholder approval of the Merger Agreement (subject to certain exceptions as provided in the Merger Agreement), and (v) use commercially reasonable efforts to obtain any regulatory approvals necessary for the Merger.
Community Shores has agreed not to, subject to certain exceptions generally related to its board of directors’ exercise of its fiduciary duties (as set forth in the Merger Agreement), solicit, initiate, encourage or facilitate inquiries or proposals with respect to, engage in any discussions or negotiations concerning, or provide any confidential information relating to, any alternative business combination transactions.
On January 6, 2020, ChoiceOne and Community Shores issued a joint press release announcing the execution of the Merger Agreement. A copy of this press release is attached to this report as Exhibit 99.2 and is incorporated herein by reference.
Attached as Exhibit 99.3 to this report is an investor presentation regarding the Merger and is incorporated herein by reference.
Forward-Looking Statements
This report contains forward-looking statements. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “is likely,” “plans,” “predicts,” “projects,” “may,” “could,” “look forward,” “continue”, “future” and variations of such words and similar expressions are intended to identify such forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements regarding the outlook and expectations of ChoiceOne and Community Shores with respect to their planned merger, the strategic benefits and financial benefits of the merger, including the expected impact of the transaction on the combined company’s future financial performance (including anticipated accretion to earnings per share, cost savings, the tangible book value earn-back period and other operating and return metrics), and the timing of the closing of the transaction. These statements reflect current beliefs as to the expected outcomes of future events and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions (“risk factors”) that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed, implied or forecasted in such forward-looking statements. Furthermore, neither ChoiceOne nor Community Shores undertake any obligation to
update, amend, or clarify forward-looking statements, whether as a result of new information, future events, or otherwise. Such risks, uncertainties and assumptions, include, among others, the following:
A free copy of the Proxy Statement/Prospectus, once available, as well as other filings containing information about ChoiceOne and Community Shores, may be obtained at the SEC’s Internet site http://www.sec.gov. You will also be able to obtain these documents, free of charge, from ChoiceOne by accessing ChoiceOne’s website at http://www.choiceone.com (which website is not incorporated herein by reference) or from Community Shores by accessing Community Shores\’ website at http://www.communityshores.com (which website is not incorporated herein by reference). Copies of the Proxy Statement/Prospectus once available can also be obtained, free of charge, by directing a request to ChoiceOne, 109 East Division Street, Post Office Box 186, Sparta, Michigan 49345, Attention: Mr. Thomas L. Lampen, or by calling 616-887-7366, or to Community Shores, 1030 West Norton Avenue Muskegon, Michigan 49441, Attention: Ms. Heather Brolick, or by calling 231-780-1845.
Participants in Solicitation
Community Shores and certain of its directors and executive officers may be deemed to be participants in the solicitation of proxies from Community Shores shareholders in respect of the transaction described in the Proxy Statement/Prospectus. Additional information regarding the interests of those participants and other persons who may be deemed participants in the transaction may be obtained by reading the Proxy Statement/Prospectus regarding the proposed merger when it becomes available. Free copies of this document may be obtained as described in the preceding paragraph.
CHOICEONE FINANCIAL SERVICES INC Exhibit
EX-2.1 2 choiceex21_010620.htm CHOICEONE EXHIBIT 2.1 TO FORM 8-K EXHIBIT 2.1 AGREEMENT AND PLAN OF MERGER BY AND BETWEEN COMMUNITY SHORES BANK CORPORATION AND CHOICEONE FINANCIAL SERVICES,…
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About ChoiceOne Financial Services, Inc. (OTCMKTS:COFS)
ChoiceOne Financial Services, Inc. is a bank holding company. The Company operates through banking segment. The Company’s subsidiary, ChoiceOne Bank (the Bank), is a full-service banking institution that offers a range of deposit, payment, credit and other financial services to all types of customers. Its services include time, savings, demand deposits, safe deposit services and automated transaction machine services. It offers both commercial and consumer loans to corporations, partnerships and individuals. Commercial lending covers categories, such as business, industry, agricultural, construction, inventory and real estate. The Bank’s consumer loan department makes direct and indirect loans to consumers and purchasers of residential and real property. The Bank’s primary market area lies within Kent, Muskegon, Newaygo and Ottawa counties in Michigan. The Bank’s subsidiary, Insurance Agency, sells insurance policies, such as life and health for both commercial and consumer clients.