HERITAGE COMMERCE CORP (NASDAQ:HTBK) Files An 8-K Entry into a Material Definitive Agreement

Both HCC and UAB may mutually agree to terminate the Merger Agreement without further liability to the other. Either party may agree to terminate the Merger Agreement if the Merger is not consummated by October1, 2018, the shareholders of UAB do not approve the Merger Agreement, or any governmental entity whose approval is required to consummate the Merger does not approve the Merger. Further, UAB may terminate the Merger Agreement for a superior proposal under certain conditions, and, HCC can terminate the Merger Agreement if the UAB board of directors withdraws or changes its recommendation to its shareholders prior to the UAB shareholder meeting held to approve the Merger Agreement. In addition, either party may terminate the Merger Agreement if the other party is in material breach of any of its representations, warranties or agreements set forth in the Merger Agreement that not are cured such that the applicable closing conditions are not satisfied.

UAB has agreed that it will pay HCC a termination fee of $2.0 million if (i)HCC terminates the Merger Agreement because UAB breaches any of its obligations relating to alternative acquisition proposals, including withdrawing its recommendation of the Merger Agreement to its shareholders; (ii)UAB terminates the Agreement in favor of a superior proposal (after providing HCC the right to increase the Merger consideration), or (iii)either HCC or UAB terminate the Merger Agreement because the UAB shareholders do not approve the Merger Agreement after an alternative acquisition proposal has been announced and, within 12 months thereafter, UAB enters into an agreement relating to an alternative acquisition proposal.

A committee comprised of independent members of UAB’s Board of Directors directed the negotiations for UAB and upon the unanimous recommendation of the independent committee’s members, UAB’s Board of Directors unanimously approved the Merger Agreement. HCC’s Board of Directors has also approved the Merger Agreement.

Although no assurance can be provided, the parties anticipate that the Merger will close in the second quarter of 2018.

The Merger Agreement and the above description of the Merger Agreement have been included to provide investors and security holders with information regarding the terms of the Merger Agreement. The Merger Agreement and the above description are not intended to provide any other factual information about HCC, HBC, UAB and ATB, or their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the Merger Agreement were made only for purposes of the Merger Agreement and as of specific dates, were solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures made by each contracting party to the other for the purposes of allocating contractual risk between them rather than 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. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts or condition of HCC, HBC, UAB or ATB or any of their respective subsidiaries, affiliates or businesses. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in public disclosures by HCC or UAB. Accordingly, investors should read the representations and warranties in the Merger Agreement not in isolation but only in conjunction with the other information about HCC or UAB and their respective subsidiaries that HCC includes in its reports, statements and other filings made with the SEC.

Shareholder Agreements

HCC entered into shareholder agreements with ATB and each of the directors of UAB, as shareholders of UAB. The shareholder agreements generally require such shareholders to vote all of their UAB Common Shares (and in addition in the case of ATB, all of its UAB preferred stock) in favor of the approval of the principal terms of the Merger Agreement and certain related matters as applicable, and against alternative transactions and generally prohibit them from transferring their shares, subject to certain exceptions. The shareholder agreements will terminate in certain circumstances, including upon the consummation of the Merger or the termination of the Merger Agreement in accordance with its terms.

Non-Competition / Non-Solicitation Agreements

HCC entered into agreements with ATB and each director and certain executive officers of UAB in connection with the Merger Agreement, to which such directors, executive officers and ATB agreed to certain customary non-solicitation restrictions. In addition, the directors and ATB agreed to certain non-compete provisions that extend for a two year period from the effective date of the Merger.

The foregoing descriptions of the Merger Agreement, the shareholder agreements and the non-competition/non-solicitation agreements do not purport to be complete and are qualified in their entirety by reference to the Merger Agreement (and the annexes included therein) attached hereto as Exhibit2.1, which is incorporated by reference herein.

Tri-Valley Bank Merger

On December20, 2017 HCC announced that it had entered into an agreement and plan of merger and reorganization with Tri-Valley Bank to which Tri-Valley Bank will merge with Heritage Bank of Commerce. Tri-Valley shareholders will receive in the merger an exchange ratio of 0.0489 of a share of HCC common stock, or an aggregate of approximately 1.9 million shares. The exchange ratio is fixed and the aggregate and per share values of the merger consideration will fluctuate between the date of the agreement and the date that the merger is completed which is expected in the second quarter of 2018.

As of September30, 2017, on a pro forma consolidated basis the combined company, including HCC, Tri-Valley Bank, and UAB, would have approximately $3.3 billion in total assets, $1.9 billion in total loans, and $2.9 billion in total deposits. On a pro forma basis, the shareholders of UAB and of Tri-Valley will own approximately 11.0% (with ATB owning 5.4%) of the issued and outstanding HCC common stock on a combined basis following the completion of both mergers.

Item 8.01 – Other Events

A copy of the joint press release issued by HCC and UAB to announce the signing of the Agreement and Plan of Merger and Reorganization, is attached to this report as Exhibit99.1.

HCC is filing an investor presentation, which provides supplemental information regarding the proposed transaction in connection with a presentation to analysts and investors and discusses certain elements of the Merger, which it intends to post on the investor relations portion of its website, which is located at www.heritagecommercecorp.com The investor presentation is included as Exhibit99.2 to this report.

The joint press release and the investor presentation shall not be deemed to be “filed” for the purposes of Section18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Additional Information about the Proposed Transaction and Where to Find It

Investors and security holders are urged to carefully review and consider HCC’s public filings with the SEC, including but not limited to its Annual Reports on Form10-K, its proxy statement, its Current Reports on Form8-K and its Quarterly Reports on Form10-Q. The documents filed by HCC with the SEC may be obtained free of charge at HCC’s website at www.heritagecommercecorp.com, under Investor Relations or at the SEC’s website at www.sec.gov. These documents may also be obtained free of charge from HCC by directing a request by telephone at (408) 947-6900 or mail to Heritage Commerce Corp, 150 Almaden Boulevard, San Jose, California 95113, Attn: Corporate Secretary.

HCC intends to file a registration statement on FormS-4 with the SEC which will include a proxy statement of UAB and a prospectus of HCC. In addition, HCC may file other documents regarding the proposed transaction with the SEC. This communication does not constitute an offer to sell or a solicitation of an offer to buy any securities or a solicitation of any vote or approval. Before making any voting or investment decision, investors and security holders of UAB are urged to carefully read the entire registration statement and proxy statement/prospectus, when they become available, as well as any amendments or supplements to these documents, because they will contain important information about the proposed transaction. A definitive proxy statement/prospectus will be sent to the shareholders of UAB seeking any required shareholder approvals. Investors and security holders will be able to obtain the registration statement and the proxy statement/prospectus free of charge from the SEC’s website or from HCC at the address provided for HCC in the paragraph above, or from UAB by request by telephone at (650)-579-1500 or mail to United American Bank, 101 South Ellsworth Avenue, San Mateo, CA 94401, attention: Corporate Secretary.

Forward-Looking Statements

This filing and the exhibits hereto contain certain forward-looking information about HCC, UAB and the combined company after the close of the Merger and is intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. Such statements involve inherent risks, uncertainties, and contingencies, many of which are difficult to predict and are generally beyond the control of HCC, UAB and the combined company. HCC cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. In addition to factors previously disclosed in reports filed by HCC with the SEC, risks and uncertainties for each institution and the combined institution include, but are not limited to: lower than expected revenues; credit quality deterioration or a reduction in real estate values could cause an increase in the provision for credit losses and allowance for credit losses and a reduction in net earnings; increased competitive pressure among depository institutions; the ability to complete the Merger, including by obtaining regulatory approvals and approval by the shareholders of UAB; the successful integration of UAB and Tri-Valley Bank, or achieving expected beneficial synergies and/or operating efficiencies, in each case within expected time-frames or at all; regulatory approvals may not be received on expected timeframes or at all; the possibility that personnel changes/retention will not proceed as planned; the possibility that a change in the interest rate environment may reduce net interest margins; higher than anticipated operating expenses; the effectiveness of our risk management framework, asset/liability re-pricing risks and liquidity risks; the costs and effects of legal, compliance, and regulatory actions, changes and developments, including the impact of adverse judgments or settlements in litigation, the initiation and resolution of regulatory or other governmental inquiries or investigations, the results of regulatory examinations or reviews; changes is law or regulations, including but not limited to tax laws; general economic conditions, either nationally or in the market areas in which the entities operate or anticipate doing business, are less favorable than expected; and other risk factors described in documents filed by HCC with the SEC.

All forward-looking statements included in this filing and the exhibits hereto are based on information available at the time of the filing. Pro forma, projected and estimated numbers are used for illustrative purposes only and are not forecasts, and actual results may differ materially.

We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise except as required by law.

HCC and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the shareholders of UAB in connection with the transaction. Information about the directors and executive officers of HCC is set forth in its Annual Report on Form10-K filed with the SEC on March3, 2017 and its Annual Meeting Proxy Statement filed on April4, 2017 with the SEC. UAB its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the shareholders of UAB in connection with the proposed transaction. Additional information regarding the interests of these participants and other persons who may be deemed participants in the proposed transaction may be obtained by reading the proxy statement/prospectus regarding the proposed transaction when it becomes available.

to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

[HERITAGE COMMERCE CORP ExhibitEX-2.1 2 a18-2358_1ex2d1.htm EX-2.1 Exhibit 2.1     AGREEMENT AND PLAN OF MERGER AND REORGANIZATION   BY AND AMONG   HERITAGE COMMERCE CORP   HERITAGE BANK OF COMMERCE   and   ATBANCORP   UNITED AMERICAN BANK   dated as of   January 10,…To view the full exhibit click here
About HERITAGE COMMERCE CORP (NASDAQ:HTBK)
Heritage Commerce Corp is a bank holding company. The Company, through its subsidiary Heritage Bank of Commerce (the Bank), provides a range of banking services. The Bank is a California state-chartered multi-community independent bank that offers a range of commercial banking services to small and medium-sized businesses and their owners, managers and employees. The Company offers a multitude of other products and services to complement its lending and deposit services. These include cashier’s checks, traveler’s checks, bank-by-mail, automated teller machines (ATMs), night depositories, safe deposit boxes, direct deposit, automated payroll services, electronic funds transfers, online banking, online bill pay, homeowner association services and other customary banking services. In addition to the traditional financial services offered, the Bank offers remote deposit capture, automated clearing house origination, electronic data interchange and check imaging.