OceanFirst Financial Corp. (NasdaqGS:OCFC) signed a definitive agreement to acquire Country Bank Holding Company, Inc. (OTCPK:CYHC) for approximately $100 million on August 9, 2019. Under the terms of the merger agreement, each shareholder of Country Bank Holding Company, Inc.'s common stock will be entitled to receive 2,000 shares of OceanFirst Financial Corp.'s common stock. In a related transaction, OceanFirst Financial Corp. signed a definitive agreement to acquire Two River Bancorp (NasdaqGM:TRCB). Concurrently with the execution of the agreement, certain shareholders of Country Bank entered into a voting and support agreement with OceanFirst, pursuant to which, on the terms and subject to the conditions set forth in the agreement, each such shareholder agreed to vote the shares of Country common stock owned beneficially or of record by such shareholder in favor of the approval of the agreement and related matters and waived any applicable dissenters' rights. Under the agreement, Country Bank Holding Company, Inc., parent company of Country Bank, will merge into OceanFirst Financial Corp. Following legal closing, Country Bank will continue to operate separately, as “Country Bank, a division of OceanFirst Bank”.

Following the effective time of the merger, Country Bank will merge with and into OceanFirst, with OceanFirst as the surviving entity. Immediately following the consummation of the merger, Country Bank will merge with and into OceanFirst Bank with OceanFirst Bank as the surviving bank. The proposed acquisition of Country Bank Holding Company, Inc. would expand OceanFirst Financial Corp.'s retail branch footprint into metropolitan New York. There are no plans to close any Country Bank branches as part of the merger. The agreement provides certain termination rights for each of OceanFirst and Country Bank, including, among others, if the closing of the merger has not been completed by May 31, 2020. If the agreement is terminated under certain circumstances, Country Bank may be obligated to pay OceanFirst a termination fee of approximately $4.1 million. After the merger, there will be one Board seat for a current Country Bank Director. Joseph M. Murphy, currently Chairman of Country Bank, will continue with OceanFirst Bank N.A. as an advisor and Joe Murphy Jr., currently President and Chief Executive Officer of Country Bank, will join OceanFirst Financial Corp. and OceanFirst Bank N.A.'s Board of Directors. At the time of legal closing, Country Bank will become part of the OceanFirst New York Region and Dan Harris will lead the management team and operations. It is expected that all Country Bank employees will continue employment in the ordinary course of business through legal closing.

The transaction is subject to Country Bank Holding Company, Inc. receiving the requisite approval of its shareholders, receipt of all required regulatory approvals, the effectiveness of the registration statement S-4 to be filed by OceanFirst with the Securities and Exchange Commission, authorization for listing on the Nasdaq of the shares of OceanFirst stock to be issued in the merger, dissenting shares constituting no more than ten percent of the outstanding shares of Country common stock, Country Bank and OceanFirst shall have received the written opinion of Luse Gorman and Skadden respectively, to the effect that, on the basis of facts, representations and assumptions set forth or referred to in such opinion, that are consistent with the state of facts existing at the effective time, the merger shall together be treated as an integrated transaction that qualifies as a reorganization, within the meaning of Section 368(a) of the Internal Revenue Code of 1986 and fulfillment of other customary closing conditions. The transaction is also subject to receipt of the approval of the New York State Department of Financial Services. The transaction is not subject to closing of Two River acquisition. The merger agreement has been unanimously approved by Boards of Directors of OceanFirst Financial Corp. and Country Bank Holding Company, Inc. On November 15, 2019, the Board of Governors of the Federal Reserve System approved the transaction. On the same day, OceanFirst Bank received approval from the Office of the Comptroller of the Currency ("OCC") to merge with Country Bank, the banking subsidiary of CYHC. The special meeting of the shareholders of Country Bank Holding Company will be held on December 10, 2019 to approve the transaction. On December 10, 2019, CYHC received the requisite shareholder approval for the merger and approval from the New York State Department of Financial Services. The merger is expected to close in the first quarter of 2020. As of December 11, 2019, the transaction is expected to close effective on or about January 1, 2020. The two acquisitions combined are expected to result in approximately 8% earnings per share accretion in 2021.

Bill Hickey and Matthew Murray of Sandler O'Neill + Partners, L.P. acted as financial advisors and fairness opinion provider to Country Bank. John J. Gorman, Max Seltzer and Victor L. Cangelosi of Luse Gorman, P.C acted as the legal advisors to Country Bank Holding Company, Inc. Piper Jaffray & Co. acted as the financial advisor and David C. Ingles of Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisor to OceanFirst Financial Corp. Sandler O'Neill will receive an advisory in an amount equal to 1.2% of the aggregate purchase price of the transaction, which advisory fee is contingent upon the closing of the transaction. At the time of announcement of the transaction, Sandler O'Neill's fee was approximately $1.2 million. Sandler O'Neill also received a $0.15 million fee from CYHC upon rendering its opinion, which opinion fee will be credited in full towards the advisory fee which will become payable to Sandler O'Neill upon closing of the transaction.

OceanFirst Financial Corp. (NasdaqGS:OCFC) completed the acquisition of Country Bank Holding Company, Inc. (OTCPK:CYHC) on January 1, 2020. Effective as of the completion of the transaction, Joseph M. Murphy, the former President of CYHC, was appointed to the Boards of Directors of OceanFirst and OceanFirst Bank.