Item 1.01. Entry into a Material Definitive Agreement.
On December 5, 2019, Wellesley Bancorp, Inc. a Maryland corporation (the
"Company" or "Wellesley") entered into an Agreement and Plan of Merger (the
"Merger Agreement") with Cambridge Bancorp ("Cambridge"), Wellesley Bank
("Wellesley Bank"), the Company's subsidiary bank, and Cambridge Trust Company
("Cambridge Trust"), Cambridge's subsidiary bank, pursuant to which Cambridge
will acquire the Company.
Subject to the terms and conditions of the Merger Agreement, which has been
approved by the boards of directors of each party, the Company will merge with
and into Cambridge, with Cambridge as the surviving entity, and immediately
thereafter, Wellesley Bank will merge with and into Cambridge Trust, with
Cambridge Trust as the surviving bank (the "Merger").
Under the terms of the Merger Agreement, each outstanding share of Company
common stock will be converted into the right to receive 0.580 shares of
Cambridge's common stock.
The Merger is subject to customary closing conditions, including the receipt of
regulatory approvals and approval by the shareholders of the Company and
Cambridge, and is expected to close in the second quarter of 2020. Following the
Merger, Thomas Fontaine, currently the President and Chief Executive Officer of
the Company, will be employed as Chief Banking Officer of Cambridge Trust.
Effective at the closing of the transaction, or at Cambridge's option,
immediately following Cambridge's 2020 annual meeting of shareholders,
Mr. Fontaine and two other members of the current board of directors of
Wellesley will be appointed to the board of directors of Cambridge and the board
of directors of Cambridge Trust, to serve until the next annual meeting of
Cambridge at which time the directors will be nominated for re-election.
Concurrently with entering into the Merger Agreement, Cambridge and the Company
entered into Voting Agreements with each of the directors and certain of the
executive officers of Cambridge and the Company, respectively, pursuant to which
such shareholders agreed to vote their shares of Cambridge or the Company,
respectively, in favor of the Merger.
If the Merger is not consummated under specified circumstances, the Company may
be required to pay Cambridge a termination fee of approximately $4.1 million.
The Merger Agreement also contains customary representations and warranties that
the Company and Cambridge made to each other as of specific dates. The
assertions embodied in those representations and warranties were made solely for
purposes of the contract between the Company and Cambridge, and may be subject
to important qualifications and limitations agreed to by the parties in
connection with negotiating its terms. Moreover, the representations and
warranties are subject to a contractual standard of materiality that may be
different from what may be viewed as material to shareholders, and the
representations and warranties may have been used to allocate risk between the
Company and Cambridge rather than establishing matters as facts.
The foregoing is not a complete description of the Merger Agreement and is
qualified in its entirety by reference to the full text of the Merger Agreement,
which is filed as Exhibit 2.1 hereto and is incorporated herein by reference.
For additional information, reference is made to the joint press release dated
December 5, 2019, which is included as Exhibit 99.1 and is incorporated herein
by reference.
Important Additional Information and Where to Find It
In connection with the proposed transaction, Cambridge expects to file with the
Securities and Exchange Commission ("SEC") a registration statement on Form S-4
that will include a joint proxy statement of the Company and Cambridge that also
constitutes a prospectus of Cambridge, which joint proxy statement/prospectus
will be mailed or otherwise disseminated to the Company's shareholders and
Cambridge's shareholders when it becomes available. The Company and Cambridge
also plan to file other relevant documents with the SEC regarding the proposed
transaction. INVESTORS ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS
AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free
copy of the joint proxy statement/prospectus (if and when it becomes available)
and other relevant documents filed by the Company and Cambridge with the SEC at
the SEC's website at www.sec.gov. Copies of the documents filed by the Company
with the SEC will be available free of charge on the Company's website at
www.wellesleybank.com or by directing a request to Wellesley Bancorp, Inc., 100
Worcester Street, Suite 300, Wellesley, MA 02481, attention: Corporate Secretary
(781) 235-2550. Copies of the documents filed by Cambridge with the SEC will be
available free of charge on Cambridge's website at ir.cambridge.com or by
directing a request to Cambridge Bancorp, 1336 Massachusetts Avenue, Cambridge,
MA 02138, attention: Corporate Secretary (617) 876-5500.
No Offer
This communication does not constitute an offer to sell or the solicitation of
an offer to buy any securities. No offering of securities shall be made except
by means of a prospectus meeting the requirements of Section 10 of the U.S.
Securities Act of 1933, as amended, and otherwise in accordance with applicable
law.
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Participants in Solicitation
The Company and Cambridge and their respective directors and executive officers
and other members of management and employees may be deemed to be participants
in the solicitation of proxies in respect of the proposed transaction. You can
find information about the Company's executive officers and directors in the
Company's definitive proxy statement filed with the SEC on April 10, 2019. You
can find information about Cambridge's executive officers and directors in
Cambridge's definitive proxy statement filed with the SEC on March 19, 2019.
Additional information regarding the interests of such potential participants
will be included in the joint proxy statement/prospectus and other relevant
documents filed with the SEC if and when they become available. You may obtain
free copies of these documents from the Company or Cambridge using the sources
indicated above.
Forward Looking Statements
This report contains forward-looking statements as defined in the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements about
Wellesley Bancorp, Inc. (together with its bank subsidiary unless the context
otherwise requires, "Wellesley") and Cambridge Bancorp (together with its bank
subsidiary unless the context otherwise requires, "Cambridge") and their
industry involve substantial risks and uncertainties. Statements other than
statements of current or historical fact, including statements regarding
Wellesley's or Cambridge's future financial condition, results of operations,
business plans, liquidity, cash flows, projected costs, and the impact of any
laws or regulations applicable to Wellesley or Cambridge, are forward-looking
statements. Words such as "anticipates," "believes," "estimates," "expects,"
"forecasts," "intends," "plans," "projects," "may," "will," "should," and other
similar expressions are intended to identify these forward-looking statements.
Such statements are subject to factors that could cause actual results to differ
materially from anticipated results. Such factors are described within
Wellesley's and Cambridge's filings with the Securities and Exchange Commission.
Among the risks and uncertainties that could cause actual results to differ from
those described in the forward-looking statements include, but are not limited
to the following: (1) the businesses of Cambridge and Wellesley may not be
combined successfully, or such combination may take longer to accomplish than
expected; (2) the cost savings from the merger may not be fully realized or may
take longer to realize than expected; (3) operating costs, customer loss and
business disruption following the merger, including adverse effects on
relationships with employees, may be greater than expected; (4) governmental
approvals of the merger may not be obtained, or adverse regulatory conditions
may be imposed in connection with governmental approvals of the merger; (5) the
stockholders of Cambridge or Wellesley may fail to approve the merger;
(6) changes to interest rates, (7) the ability to control costs and expenses,
(8) general economic conditions, (9) the success of Cambridge's efforts to
diversify its revenue base by developing additional sources of non-interest
income while continuing to manage its existing fee-based business, and
(10) risks associated with the quality of Cambridge's assets and the ability of
its borrowers to comply with repayment terms. Further information about these
and other relevant risks and uncertainties may be found in Cambridge's and
Wellesley's respective Annual Reports on Form 10-K for the fiscal year ended
December 31, 2018 and in subsequent filings with the Securities and Exchange
Commission.
Wellesley and Cambridge do not undertake, and specifically disclaims any
obligation, to publicly release the result of any revisions which may be made to
any forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such statements. You are
cautioned not to place undue reliance on these forward-looking statements.
Item 8.01. Other Events.
On December 5, 2019, the Company issued a press release to announce the signing
of the Merger Agreement, which is attached hereto as Exhibit 99.1 and
incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number Description
2.1* Agreement and Plan of Merger, dated December 5, 2019, by and among
Cambridge Bancorp, Cambridge Trust Company, Wellesley Bancorp, Inc.
and Wellesley Bank.
99.1 Press Release, dated December 5, 2019.
* Wellesley Bancorp has omitted certain schedules and exhibits pursuant to Item
601(a)(5) of Regulation S-K and shall furnish supplementally to the SEC
copies of any of the omitted schedules and exhibits upon request by the SEC.
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