ENTEGRA FINANCIAL CORP. (NASDAQ:ENFC) Files An 8-K Completion of Acquisition or Disposition of Assets
ITEM 2.01
At 11:59 p.m. on December 31, 2019, First Citizens completed its previously announced acquisition of Entegra. On December 31, 2019, Merger Subsidiary merged with and into Entegra, with Entegra surviving the First Step Merger. Upon the First Step Merger, the separate existence of Merger Subsidiary ceased. At 12:01 a.m. on January 1, 2020, Entegra merged with and into FCB, with FCB surviving the Second Step Merger. Upon the Second Step Merger, the separate existence of Entegra ceased. At 12:02 a.m. on January 1, 2020, Entegra Bank merged with and into FCB, with FCB surviving the Bank Merger. Upon the Bank Merger, the separate existence of Entegra Bank ceased.
Under the terms of the Merger Agreement, at the effective time of the First Step Merger (the “Effective Time”), each share of common stock, no par value, of Entegra (“Entegra Common Stock”) outstanding as of immediately prior to the Effective Time (other than certain excluded shares) was converted into the right to receive $30.18 in cash (the “Cash Consideration”). The Merger Agreement anticipated that each outstanding Entegra restricted stock unit (the “Entegra RSU Awards”) would fully vest and be canceled and converted automatically into the right to receive the Cash Consideration. The Merger Agreement further anticipated that at the Effective Time, (i) each outstanding option to purchase Entegra Common Stock (the “Entegra Options”) issued by Entegra with an exercise price (an “Exercise Price”) below the Cash Consideration would be automatically exercised, and each such exercised Entegra Option would represent the right to receive, per share, the amount by which the Cash Consideration exceeded the applicable Exercise Price (the “Option Payment”), and (ii) all other outstanding Entegra Options issued by Entegra would be cancelled. Despite such provisions relating to the payments to be made on account of the Entegra RSU Awards and Entegra Options, the parties agreed that all equity awards that would otherwise give rise to payments as a result of the Merger Agreement instead be cancelled before the Mergers were completed, and that Entegra pay out prior to consummation the equivalent of what such awards would have received in the Mergers. On December 19, 2019, the Board of Directors of Entegra authorized (1) the accelerated vesting of the Entegra Options and Entegra RSU Awards outstanding as of December 19, 2019, and (2) the payment of an amount equal to the Option Payments on account of the Entegra Options with Exercise Prices below the Cash Consideration and the payment of an amount equal to the Cash Consideration on account of the Entegra RSU Awards. The Board of Directors of Entegra further authorized Entegra to enter into option and restricted stock cancellation agreements with any and all holders of such Entegra Options and Entegra RSU Awards to which such holders received the amounts that would otherwise have been paid under the Merger Agreement.
The foregoing description of the Mergers and 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 was filed as Exhibit 2.1 to Entegra’s Current Report on Form 8-K filed on April 24, 2019 and is incorporated herein by reference.
As a result of the Mergers, Entegra no longer fulfills the listing requirements of the NASDAQ Global Market (“NASDAQ”). On December 31, 2019, Entegra notified NASDAQ that the transaction would be closing as of 11:59 p.m. and requested that NASDAQ (i) suspend trading of Entegra Common Stock, (ii) withdraw Entegra Common Stock from listing on NASDAQ before the opening of trading on January 2, 2020 and (iii) file with the SEC a notification of delisting of Entegra Common Stock under Section 12(b) of the Securities Exchange Act of 1934, as amended. As a result, Entegra Common Stock will no longer be listed on NASDAQ.
As set forth under Item 2.01 of this Current Report on Form 8-K, as of the Effective Time, each share of Entegra Common Stock outstanding as of immediately prior to the Effective Time (other than certain excluded shares) was converted into the right to receive the Cash Consideration. The Merger Agreement anticipated that each outstanding Entegra RSU Award would fully vest and be canceled and converted automatically into the right to receive the Cash Consideration. The Merger Agreement further anticipated that at the Effective Time, (i) each outstanding Entegra Option issued by Entegra with an Exercise Price below the Cash Consideration would be automatically exercised, and each such exercised Entegra Option would represent the right to receive the Option Payment, and (ii) all other outstanding Entegra Options issued by Entegra would be cancelled. Despite such provisions relating to the payments to be made on account of the Entegra RSU Awards and Entegra Options, the parties agreed that all equity awards otherwise giving rise to payments as a result of the Merger Agreement instead be cancelled before the Mergers were completed, and that Entegra pay out before consummation the equivalent of what such awards would have received in the Mergers. On December 19, 2019, the Board of Directors of Entegra authorized (1) the accelerated vesting of the Entegra Options and Entegra RSU Awards outstanding as of December 19, 2019, and (2) the payment of an amount equal to the Option Payments on account of the Entegra Options with Exercise Prices below the Cash Consideration and the payment of an amount equal to the Merger Consideration on account of the Entegra RSU Awards. The Board of Directors of Entegra further authorized Entegra to enter into option and restricted stock cancellation agreements with any and all holders of such Entegra Options and Entegra RSU Awards to which such holders received the amounts that would otherwise have been paid under the Merger Agreement.
The information set forth under Items 2.01 and 3.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.
At 11:59 p.m. on December 31, 2019, Merger Sub was merged with and into Entegra, with the result that all of Entegra Common Stock was converted into the right to receive and into the Cash Consideration and Entegra became an indirect wholly-owned subsidiary of First Citizens.
The information set forth under Items 2.01, 3.03 and 5.02 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
In connection with the Mergers, all of Entegra’s directors and executive officers ceased serving as directors and executive officers of Entegra as of the Effective Time.
Also in connection with the Merger, the employment of each of Roger D. Plemens, Entegra’s President and Chief Executive Officer, and David A. Bright, Entegra’s Chief Financial Officer, was terminated effective as of the Closing Date. Entegra and Mr. Plemens entered into a Consulting Agreement effective immediately after the Effective Time. Ryan Scaggs, Entegra’s Chief Operating Officer, entered into a First Amendment to Employment and Change of Control Agreement and Release of Claims with Entegra effective immediately upon the Closing Date.
As of the effective time of the Second Step Merger, the Articles of Incorporation, as amended and restated, and the Bylaws, as amended and restated, of Entegra ceased to be in effect by operation of law and the organizational documents of FCB (as successor to Entegra by operation of law) remained the Amended and Restated Articles of Incorporation and the Amended and Restated Bylaws of FCB, consistent with the terms of the Merger Agreement. A copy of the Amended and Restated Articles of Incorporation and Amended and Restated Bylaws of FCB are filed as Exhibits 3.1 and 3.2 of this Current Report on Form 8-K, respectively, and are incorporated herein by reference.
On January 1, 2020, FCB issued a press release announcing the completion of the Mergers, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference.
(d) Exhibits
| Exhibit 2.1 | Agreement and Plan of Merger by and between Entegra, First Citizens, FCB and Merger Subsidiary (incorporated by reference to Exhibit 2.1 of the Current Report on Form 8-K, filed by Entegra on April 24, 2019) |
| Exhibit 3.1 | Amended and Restated Articles of Incorporation of FCB |
| Exhibit 3.2 | Amended and Restated Bylaws of FCB |
| Exhibit 99.1 | Press release dated January 1, 2020 |
Entegra Financial Corp. Exhibit
EX-3.1 2 e19532_ex3-1.htm Exhibit 3.1 ARTICLES OF RESTATEMENT OF FIRST-CITIZENS BANK & TRUST COMPANY The undersigned corporation hereby executes these Articles of Restatement for the purpose of amending and integrating into one document its original Articles of Incorporation and all amendments thereto; 1.The name of the bank is First-Citizens Bank & Trust Company. 2The text of the amended and restated Articles of Incorporation is attached hereto as an exhibit. 3.The restated Articles of Incorporation do not contain any amendments to the Articles of Incorporation requiring shareholder approval,…
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About ENTEGRA FINANCIAL CORP. (NASDAQ:ENFC)
Entegra Financial Corp. is the holding company for Entegra Bank. The Company provides a range of financial services through full-service offices located in Cherokee, Henderson, Jackson, Macon, Polk and Transylvania counties, North Carolina and Anderson, Greenville, and Spartanburg counties, South Carolina. It provides full service retail and commercial banking products, as well as wealth management services through a third party. It operates through retail banking segment. Entegra Bank is a chartered savings bank. The Bank’s business consists primarily of accepting deposits from individuals and small businesses and investing those deposits, together with funds generated from operations and borrowings, primarily in loans secured by real estate, including commercial real estate loans, one- to four-family residential loans, construction loans, and home equity loans and lines of credit. It also originates commercial business loans and invests in investment securities.
