Howard Bancorp : Material Event (Form 8-K)

Entry into a Material Definitive Agreement.

On July 12, 2021, F.N.B. Corporation ('F.N.B.'), the parent company of First National Bank of Pennsylvania, and Howard Bancorp, Inc. ('Howard'), the parent company of Howard Bank, entered into an Agreement and Plan of Merger (the 'Merger Agreement'), pursuant to which Howard will merge with and into F.N.B. As a result of the merger, the separate corporate existence of Howard will cease and F.N.B. will continue as the surviving corporation (the 'Merger'). The Merger is expected to be completed in early 2022, subject to approval by Howard stockholders and receipt of required regulatory and other approvals and satisfaction of customary closing conditions. Immediately after the Merger is completed, Howard Bank, a Maryland-chartered bank, will merge with and into First National Bank of Pennsylvania, a national association, with First National Bank of Pennsylvania being the surviving entity.

Subject to the terms and conditions of the Merger Agreement and in connection with the Merger, holders of Howard common stock will have the right to receive shares of F.N.B. common stock at a fixed exchange ratio of 1.80 shares of F.N.B. common stock for each share of Howard common stock (the 'Exchange Ratio'), and cash in lieu of any fractional shares (the 'Merger Consideration'). Any shares of Howard common stock that are held by Howard and its subsidiaries (other than in a fiduciary, custodial, agency or similar capacity) will be cancelled without receipt of any stock or cash consideration. The Merger is expected to qualify as a tax-free exchange for Howard stockholders.

Additionally, at the effective time of the Merger, each outstanding Howard stock option will be assumed and converted into a fully vested option to purchase a number of shares of F.N.B. common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying the number of shares of Howard common stock subject to the option and the Exchange Ratio, at an exercise price (rounded up to the nearest whole cent) obtained by dividing the per share exercise price under the option by the Exchange Ratio. The Howard stock options otherwise will continue to be subject to the same terms and conditions which applied immediately before the completion of the Merger. Immediately before the effective time of the Merger, each outstanding Howard restricted stock unit, if and to the extent provided under the terms of the applicable award agreement, will become fully-vested and will be converted, as of the effective time of the Merger, into the right to receive, without interest, the Merger Consideration. Any other Howard restricted stock units that are not fully vested pursuant to the terms of the applicable award agreement will convert into F.N.B. restricted stock unit awards (and will be adjusted so that its holder will be entitled to receive a number of shares of F.N.B. common stock (rounded down to the nearest whole share) equal to the product obtained by multiplying the number of shares of Howard common stock subject to such Howard restricted stock units immediately prior to the effective time of the Merger and the Exchange Ratio) and will otherwise continue to be subject to the same terms and conditions in effect immediately before the Merger.

The Merger Agreement provides that, as of the effective time of the Merger, F.N.B. will appoint two current directors of the Howard board of directors, to be mutually selected by the parties, to serve as the Chairperson and Vice Chairperson of the F.N.B. Mid-Atlantic Regional Advisory Board, for a minimum term of two years.

The Merger Agreement contains various customary representations, warranties and covenants by Howard and F.N.B., including among others, covenants relating to the conduct of their respective businesses during the interim period between the execution of the Merger Agreement and the effective time of the Merger. Howard has also agreed to call a meeting of its stockholders to consider and vote upon a proposal to approve the Merger. Additionally, Howard agreed that it will not solicit or knowingly encourage proposals for an alternative business combination transaction or, subject to certain exceptions, enter into discussions or furnish information in connection with any proposals for alternative business combination transactions.

The Merger will not be completed unless a number of customary closing conditions are met, including, among others: approval of the Merger by Howard stockholders; the effectiveness of the Form S-4 registration statement to be filed by F.N.B. with the Securities and Exchange Commission (the 'SEC') for the F.N.B. common stock to be issued in the Merger; authorization for listing on the New York Stock Exchange of the F.N.B. common stock to be issued in the Merger; receipt of required regulatory and other approvals, including the approvals of the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency and the Maryland Office of the Commissioner of Financial Regulation, and the expiration of all applicable statutory waiting periods; the accuracy of the representations and warranties of each party specified in the Merger Agreement; each party's receipt of an opinion from its tax counsel to the effect that the Merger will qualify as a 'reorganization' within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended; and the absence of any injunctions, court orders or other legal restraints preventing the completion of the Merger.

The Merger Agreement provides for termination rights which may be exercised by Howard or F.N.B. upon the occurrence of certain events, such as the following: a required regulatory approval is denied by final, non-appealable action of a governmental entity; the parties fail to complete the Merger by June 30, 2022; the other party has breached a representation, warranty or covenant which would prevent a closing condition from being satisfied and the breach is not or cannot be cured within 30 days; or the Howard stockholders have failed to approve the Merger. In addition, during a specified period prior to the closing of the Merger, if the average closing price of F.N.B. common stock is less than 80% of its average closing price over the 10 trading days immediately prior to the execution of the Merger Agreement, and F.N.B. common stock underperforms a specified peer group index by more than 20%, then Howard may terminate the Merger Agreement; provided, that, F.N.B. will have a right to increase the exchange ratio to prevent these thresholds from being triggered in the event that Howard seeks to exercise this right. In addition, Howard may also terminate the Merger Agreement to enter into an alternative business combination transaction pursuant to a 'superior proposal,' as defined by the Merger Agreement. If the Merger Agreement is terminated under certain circumstances, Howard has agreed to pay F.N.B. a termination fee of $15.0 million.

In connection with the Merger Agreement, certain stockholders of Howard, including each director of Howard, entered into a voting agreement with F.N.B. in which he or she has agreed, among other things, to vote the shares of Howard common stock owned beneficially or of record by such stockholder in favor of the Merger Agreement and the Merger at the special meeting of Howard's stockholders at which these matters are to be considered.

The foregoing summary of the Merger Agreement and the voting agreements does not purport to be complete and is qualified in its entirety by reference to the complete text of those agreements. As such, the Merger Agreement, which is attached hereto as Exhibit 2.1, is incorporated herein by reference; and the forms of voting agreements, which are exhibits to the Merger Agreement, are also incorporated herein by reference.

The representations, warranties and covenants of each party set forth in the Merger Agreement have been made only for purposes of, were and are solely for the benefit of the parties to, the Merger Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Merger Agreement instead of 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. In addition, the representations and warranties in the Merger Agreement (i) will not survive consummation of the Merger, unless otherwise specified therein, and (ii) were made only as of the date of the Merger Agreement or such other date as is specified in the Merger Agreement. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the parties' public disclosures. Accordingly, the Merger Agreement is included with this filing only to provide investors with information regarding the terms of the Merger Agreement, and not to provide investors with any other factual information regarding F.N.B., Howard, their respective affiliates or their respective businesses. The Merger Agreement should not be read alone, but should instead be read in conjunction with the other information regarding F.N.B. or Howard, their respective affiliates or their respective businesses, the Merger Agreement and the Merger that will be contained in, or incorporated by reference into, the registration statement on Form S-4 to be filed by F.N.B. with the SEC that will include a proxy statement of Howard and a prospectus of F.N.B., as well as in the Forms 10-K, Forms 10-Q and other filings that each of F.N.B. and Howard make with the SEC.

Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On July 12, 2021, Howard's board of directors amended and restated Howard's bylaws (the 'Amended Bylaws') to amend certain provisions in Sections 1.4 through 1.8 of Article I and to add (a) Section 1.16 to Article I, (b) a new Article IX, and (c) a new Article XI.

Sections 1.4 through 1.8 of Article I were amended to, among other things, clarify matters related to the conduct of, and the potential postponement or adjournment of, Howard stockholders' meetings. Specifically, Section 1.4 of Article I was amended to provide that Howard may postpone or cancel a meeting of stockholders by making public disclosure of such postponement or cancellation prior to the meeting, and Section 1.5 was amended to provide that the presiding officer of the meeting may adjourn the meeting from time to time to a date not more than 120 days after the original record date, without notice, other than announcement at the meeting. Section 1.7 of Article I was amended to provide that in the absence of the Chair of the Board, meetings of stockholders will be presided over by the President of Howard, or by an individual appointed by the board of directors, and Section 1.8 of Article I was amended to provide, among other things, that the presiding officer will determine the order of business and all other matters of procedure at any meeting of stockholders and may prescribe rules, regulations and procedures related thereto.

Section 1.16 of Article I was added to provide that the Maryland Control Share Acquisition Act will not apply to any acquisition by any person of shares of Howard's stock, including any acquisition pursuant to, or otherwise arising out of or in connection with, the Merger Agreement. Article IX requires that certain types of actions, including certain actions brought against Howard or its directors or officers, be brought in courts in Maryland, and that any action or claim arising under the Securities Act of 1933 or any regulations thereunder be brought in a Maryland federal district court. Finally, Article XI provides that whenever possible, each provision in the bylaws will be interpreted in a manner to be valid and effective under applicable law and that each section of the bylaws will be deemed separate and independent, and should any part of any section or clause be declared invalid or unenforceable, such invalidity or unenforceability will not render any other part or section of the bylaws invalid or unenforceable.

The foregoing description of the Amended Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended Bylaws, which is filed as Exhibit 3.1hereto and is incorporated herein by reference.

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Cautionary Statement Regarding Forward-Looking Information

This Current Report on Form 8-K contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements include, but are not limited to, statements about the outlook and expectations of F.N.B. and Howard with respect to their planned merger, the strategic benefits and financial benefits of the merger and the timing of the closing of the transaction.

Forward-looking statements are typically identified by words such as 'believe', 'plan', 'expect', 'anticipate', 'intend', 'outlook', 'estimate', 'forecast', 'will', 'should', 'project', 'goal', and other similar words and expressions. Forward-looking statements are subject to risks, uncertainties and assumptions which may change over time or as a result of unforeseen circumstances. Future events or circumstances may change expectations or outlook and may affect the nature of the assumptions, risks and uncertainties to which forward-looking statements are subject. The forward-looking statements in this Current Report on Form 8-K pertain only to the date hereof, and F.N.B. and Howard disclaim any obligation to update or revise any forward-looking statements, except as required by law. Actual results or future events may differ, possibly materially, from those that are anticipated in these forward-looking statements. Accordingly, we caution against placing undue reliance on any forward-looking statements.

Forward-looking statements contained in this Form 8-K are subject to, among others, the following risks, uncertainties and assumptions:

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The possibility that the anticipated benefits of the transaction, including anticipated cost savings and strategic gains, are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy, competitive factors in the areas where F.N.B. and Howard do business, or as a result of other unexpected factors or events;

●	Completion of the transaction is dependent on the satisfaction of customary closing conditions, including approval by Howard stockholders, which cannot be assured, and the timing and completion of the transaction is dependent on various factors that cannot be predicted with precision at this point;

●	The occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement;

●	Completion of the transaction is subject to bank regulatory approvals and such approvals may not be obtained in a timely manner or at all or may be subject to conditions which may cause additional significant expense or delay the consummation of the merger transaction;

●	Potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the transaction;

●	The outcome of any legal proceedings that may be instituted against F.N.B. or Howard;

●	Subsequent federal legislative and regulatory actions and reforms affecting the financial institutions' industry may substantially impact the economic benefits of the proposed merger;

●	Unanticipated challenges or delays in the integration of Howard's business into F.N.B.'s and or the conversion of Howard's technology systems and customer data may significantly increase the expense associated with the transaction; and

●

Other factors that may affect future results of F.N.B. and Howard including changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates and capital markets; inflation; customer borrowing, repayment, investment and deposit practices; the impact, extent and timing of technological changes; capital management activities; and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms.

These forward-looking statements are also subject to the principal risks and uncertainties applicable to F.N.B.'s and Howard's respective businesses and activities generally that are disclosed in F.N.B.'s 2020 Annual Report on Form 10-K and in other documents F.N.B. files with the SEC, and in Howard's 2020 Annual Report on Form 10-K and in other documents Howard files with the SEC. F.N.B.'s and Howard's SEC filings are accessible on the SEC website at www.sec.gov.

Additional Information About the Merger and Where to Find It

This Form 8-K is being made in respect of the proposed merger transaction between F.N.B. and Howard. In connection with the proposed merger, F.N.B. will file a registration statement on Form S-4 with the SEC to register F.N.B.'s shares that will be issued to Howard's stockholders in connection with the merger. The registration statement will include a proxy statement of Howard and a prospectus of F.N.B., as well as other relevant documents concerning the proposed transaction.

INVESTORS ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE MERGER WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.

This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

The proxy statement/prospectus and other relevant materials (when they become available), and any other documents F.N.B. and Howard have filed with the SEC, may be obtained free of charge at the SEC's website at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents F.N.B. has filed with the SEC by contacting James Orie, Chief Legal Officer, F.N.B. Corporation, One North Shore Center, Pittsburgh, PA, 15212, telephone: [phone]; and may obtain free copies of the documents Howard has filed with the SEC by contacting Joseph Howard, Chief Legal Officer, Howard Bancorp, Inc., 3301 Boston Street, Baltimore, MD 21224, telephone: [phone].

Participants in the Solicitation

F.N.B. and Howard and certain of their directors and executive officers may be deemed to be participants in the solicitation of proxies from Howard's stockholders in connection with the proposed merger. Information regarding F.N.B.'s directors and executive officers is contained in F.N.B.'s Proxy Statement on Schedule 14A, dated March 26, 2021 and in certain of its Current Reports on Form 8-K, which are filed with the SEC. Information regarding Howard's directors and executive officers is contained in Howard's Proxy Statement on Schedule 14A, dated April 13, 2021, and in certain of its Current Reports on Form 8-K, which are filed with the SEC. 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 these documents may be obtained as described in the preceding paragraph.

Financial Statements and Exhibits.

(d) Exhibits

2.1	Agreement and Plan of Merger between F.N.B. Corporation and Howard Bancorp, Inc., dated as of July 12, 2021+
3.1	Bylaws of Howard Bancorp, Inc., as amended and restated through July 12, 2021
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document).
+	Schedules and similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant will furnish supplementally a copy of any omitted schedules or similar attachment to the SEC upon request.