DEFM14A: Blue Foundry Bancorp to Merge with Fulton Financial

Sentiment:

Merger Proxy Statement 23 December 2025 9:08 PM

Blue Foundry Bancorp will merge with Fulton Financial Corporation in an all-stock transaction valued at approximately $243 million, offering a significant premium to Blue Foundry stockholders.

Delay expectedThe actual date of merger completion is uncertain and subject to conditions and factors outside the control of both companies.Regulatory approvals may take longer than expected or may not be received at all.Regulators may impose conditions, limitations, obligations, or restrictions that could delay completion or reduce anticipated benefits.Potential claims and litigation pertaining to the merger could prevent or delay its completion.

Capital raiseFulton expects to issue approximately 13.5 million shares of Fulton common stock as merger consideration to Blue Foundry stockholders, which represents an increase in outstanding capital stock.

Better than expectedThe merger offers Blue Foundry stockholders a substantial premium of 47.4% over its market price prior to the announcement.Blue Foundry has been underperforming as a standalone entity, with negative returns on average assets and tangible common equity, a high efficiency ratio, and no dividend payments, making the acquisition a favorable outcome.The transaction is expected to be accretive to Fulton's earnings per share and tangible book value, indicating a positive financial outcome for the acquiring company.

Summary

Fulton Financial Corporation (Fulton) will acquire Blue Foundry Bancorp (Blue Foundry) in an all-stock transaction, with Blue Foundry merging into Fulton.
Following the merger, Blue Foundry Bank, a subsidiary of Blue Foundry, will merge into Fulton Bank, N.A., a subsidiary of Fulton.
Each share of Blue Foundry common stock will be converted into the right to receive 0.650 of a share of Fulton common stock, plus cash in lieu of fractional shares.
Based on Fulton's closing price on November 21, 2025, the merger consideration represented approximately $11.67 per Blue Foundry share, totaling approximately $243 million.
Based on Fulton's closing price on December 19, 2025, the implied value per Blue Foundry share was approximately $13.12.
The merger is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes for Blue Foundry stockholders, except for cash received for fractional shares.
Fulton expects to issue approximately 13.5 million shares of its common stock to Blue Foundry stockholders in the aggregate.
Blue Foundry will hold a special meeting on January 29, 2026, at 11:00 a.m. ET (via live webcast) for stockholders to vote on the merger and an adjournment proposal.
The Blue Foundry board of directors unanimously recommends that stockholders vote FOR the merger proposal and the adjournment proposal.
Blue Foundry options will fully vest and be converted into cash payments, while restricted stock awards will fully vest and convert into Fulton common stock.
Post-merger, legacy Fulton shareholders are expected to hold approximately 93.5% and former Blue Foundry stockholders approximately 6.5% of the combined company.

Sentiment

Score: 8

Explanation: The sentiment is highly positive for Blue Foundry stockholders due to the significant premium and the resolution of the company's underperformance. For Fulton, the transaction is strategically sound and expected to be financially accretive, despite typical integration risks.

Positives

Blue Foundry stockholders will receive a premium of approximately 45% to Blue Foundry's market price as of November 23, 2025.
The all-stock nature of the transaction allows Blue Foundry stockholders to participate in the future performance of the larger, combined company.
The merger is expected to be accretive to Fulton's estimated earnings per share (excluding one-time transaction costs) and tangible book value per share from 2026 through 2029.
The combined entity is anticipated to benefit from expanded opportunities for organic growth and future acquisitions due to its larger size, asset base, capital, market capitalization, and geographic footprint.
Enhanced liquidity for Blue Foundry's stockholders is expected post-merger.
The transaction is expected to create economies of scale and cost savings opportunities due to the complementary nature of the businesses.
The combined company will have enhanced deposit market share positions in Morris and Middlesex Counties of New Jersey.
The merger is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes for Blue Foundry stockholders (excluding cash for fractional shares).
Fulton has a history of paying quarterly cash dividends, offering income potential to former Blue Foundry stockholders.
Blue Foundry's financial advisor, Piper Sandler & Co., rendered an opinion that the exchange ratio is fair, from a financial point of view, to Blue Foundry common stockholders.
Continuing Blue Foundry employees will receive base salaries/hourly wages no less favorable for one year and annual cash bonus opportunity as a percentage of base salary no less favorable until after December 31, 2026.
Fulton will provide substantially comparable employee benefits in the aggregate for one year to continuing employees and use commercially reasonable efforts to recognize prior service credit.

Negatives

The value of the merger consideration will fluctuate based on the market price of Fulton common stock until the merger is completed.
Blue Foundry stockholders will have a significantly reduced ownership and voting interest (approximately 6.5%) in the combined company.
Blue Foundry stockholders will not be entitled to appraisal rights under Delaware law in connection with the merger.
Substantial non-recurring costs related to the merger and integration are expected, which may be greater than anticipated.
Combining the businesses may be more difficult, costly, or time-consuming than expected, potentially hindering the realization of anticipated benefits and cost savings.
There is a risk of losing key Blue Foundry employees during the pendency of the merger and thereafter.
Regulatory approvals may be delayed, not received, or impose materially burdensome conditions on Fulton following the merger.
Prospective financial information is based on various assumptions and may not be realized, with actual results potentially differing materially.
Certain Blue Foundry directors and executive officers have interests in the merger that differ from general stockholders, creating potential conflicts of interest.
Failure to complete the merger could negatively impact both companies, leading to adverse market reactions and missed strategic opportunities.
Blue Foundry may be required to pay a termination fee of $9,694,662 to Fulton under certain circumstances.
Both companies will be subject to business uncertainties and contractual restrictions while the merger is pending, potentially limiting their ability to pursue other opportunities.
The announcement of the merger could disrupt relationships with employees, customers, suppliers, and business partners.
The merger agreement limits Blue Foundry's ability to solicit or engage in discussions regarding alternative acquisition proposals.
The issuance of approximately 13.5 million shares of Fulton common stock may adversely affect Fulton's market price due to dilution.
Fulton's articles contain anti-takeover provisions that could impede future takeovers, potentially limiting future premium opportunities for former Blue Foundry stockholders.

Risks

The market price of Fulton common stock may fluctuate prior to the effective time, including as a result of Blue Foundry's financial performance prior to the effective time, making the market value of the merger consideration uncertain.
The market price of Fulton common stock after the merger may be affected by factors different from those currently affecting the independent businesses of Fulton and Blue Foundry.
The opinion delivered by Piper Sandler & Co. to the Blue Foundry board of directors will not reflect changes in circumstances that may have occurred since the date of such opinion (November 23, 2025).
Fulton and Blue Foundry are expected to incur substantial costs related to the merger and integration, and these costs may be greater than anticipated due to unexpected events.
Combining Fulton and Blue Foundry may be more difficult, costly, or time-consuming than expected, and Fulton and Blue Foundry may fail to realize the anticipated benefits and cost savings of the merger.
Fulton may be unable to retain legacy Blue Foundry personnel successfully after the completion of the merger.
Regulatory approvals may not be received, may take longer than expected, or may impose conditions that are not presently anticipated or that could have an adverse effect on Fulton following the merger.
The prospective financial information presented in this proxy statement/prospectus is based on various assumptions and may not be realized, with actual results potentially varying materially.
Certain of Blue Foundry's directors and executive officers may have interests in the merger that may differ from, or are in addition to, the interests of Blue Foundry stockholders.
If the requisite approval of Blue Foundry stockholders is not obtained, or other conditions to the closing of the merger are not met, the merger agreement may be terminated.
Failure to complete the merger could negatively impact Fulton or Blue Foundry, including adverse reactions from financial markets, customers, and employees, and the inability to pursue other beneficial opportunities.
Blue Foundry may be required to pay a termination fee of $9,694,662 to Fulton if the merger agreement is terminated under certain circumstances.
Fulton and Blue Foundry will be subject to business uncertainties and contractual restrictions while the merger is pending, potentially preventing them from pursuing attractive business opportunities.
The announcement of the proposed merger could disrupt Fulton's and Blue Foundry's relationships with their employees, customers, suppliers, business partners, and others, as well as their operating results and business generally.
The merger agreement limits Blue Foundry's ability to pursue alternatives to the merger and may discourage other companies from trying to acquire Blue Foundry.
The shares of Fulton common stock to be received by Blue Foundry stockholders as a result of the merger will have different rights from the shares of Blue Foundry common stock.
Fulton has various provisions in its articles that could impede a takeover of Fulton, potentially preventing former Blue Foundry stockholders from taking part in a future transaction at a premium.
Blue Foundry stockholders will have a reduced ownership and voting interest in Fulton after the consummation of the merger and will exercise less influence over management.
Blue Foundry stockholders will not have appraisal rights in connection with the merger or other matters to be voted on at the Blue Foundry special meeting.
Issuance of shares of Fulton common stock in connection with the merger may adversely affect the market price of Fulton common stock.
Fulton or Blue Foundry or both may be subject to claims and litigation pertaining to the merger that could prevent or delay the completion of the merger.

Future Outlook

The merger is expected to be accretive to Fulton's estimated earnings per share and tangible book value per share from 2026 through 2029, excluding one-time transaction costs. Blue Foundry's board believes the merger will create a more competitive banking franchise with strong capital ratios and an attractive funding base, potentially delivering higher value to its stockholders compared to operating as a standalone entity. The combined company anticipates expanded opportunities for organic growth and future acquisitions due to its increased size, asset base, capital, market capitalization, and geographic footprint.

Management Comments

James D. Nesci, President and Chief Executive Officer of Blue Foundry Bancorp, expressed gratitude for prompt attention to this important matter.
The Blue Foundry board of directors unanimously determined that the merger agreement, the merger, and the contemplated transactions are advisable and in the best interests of Blue Foundry and its stockholders.

Industry Context

The financial services industry is currently characterized by evolving economic conditions, interest rate fluctuations, and a complex regulatory environment, leading to increased operating costs and heightened competition from both traditional banks and financial technology firms. This merger represents a strategic response to these challenges, allowing Blue Foundry to transition from a standalone entity with underperforming metrics (e.g., negative return on assets and equity, high efficiency ratio) into a larger, more diversified banking franchise. The transaction aligns with broader industry trends of consolidation to achieve economies of scale, enhance market share, and improve operational efficiency, particularly in attractive banking markets like New Jersey where Blue Foundry had less than 1% deposit market share. Fulton's recent acquisition of Republic First Bancorp in April 2024 further underscores its strategy of growth through M&A in the region.

Comparison to Industry Standards

Blue Foundry's LTM Return on Average Assets of (0.44)% is significantly below its peer group median of 0.49%, indicating underperformance.
Blue Foundry's LTM Return on Average Tangible Common Equity of (2.8)% is substantially lower than its peer group median of 5.9%, highlighting profitability challenges.
Blue Foundry's LTM Net Interest Margin of 2.17% is below its peer group median of 2.68%, suggesting less efficient interest income generation.
Blue Foundry's LTM Efficiency Ratio of 118.1% is considerably higher than its peer group median of 62.5%, indicating poor operational efficiency.
Blue Foundry's Price/Tangible Book Value of 52% is well below its peer group median of 76%, reflecting a lower market valuation relative to its book assets.
Blue Foundry's Current Dividend Yield of 0.0% contrasts sharply with its peer group median of 4.3%, indicating no direct return to shareholders from dividends.
Fulton's LTM Return on Average Assets of 1.13% is above its peer group median of 0.85%, demonstrating strong profitability.
Fulton's LTM Return on Average Tangible Common Equity of 15.0% is significantly above its peer group median of 11.0%, indicating efficient use of equity.
Fulton's LTM Net Interest Margin of 3.47% is slightly above its peer group median of 3.39%, showing competitive interest income generation.
Fulton's LTM Efficiency Ratio of 57.1% is comparable to its peer group median of 54.7%, indicating competitive operational efficiency.
Fulton's Price/Tangible Book Value of 125% is below its peer group median of 145%, suggesting potential undervaluation relative to its assets.
Fulton's Price/LTM Earnings per Share of 9.4x is below its peer group median of 13.0x, also suggesting potential undervaluation relative to earnings.
Fulton's Current Dividend Yield of 4.2% is above its peer group median of 3.2%, offering a more attractive dividend return.
The 47.4% premium to Blue Foundry's market price (as of November 21, 2025) is significantly higher than the median 1-day market premium of 12.5% for comparable nationwide bank and thrift transactions, indicating a favorable offer for Blue Foundry stockholders.
The transaction price to tangible book value of 77% for Blue Foundry is below the median of 96% for comparable nationwide bank and thrift transactions, which might suggest a lower valuation of Blue Foundry's assets or a higher proportion of non-core deposits compared to precedent deals.

Management Changes

Role	Previous Person	New Person	Effective Date	Reason
President and Chief Executive Officer (Blue Foundry)	James D. Nesci	N/A (employment ceases)	Effective Date of Merger	Employment ceases upon merger, superseded by Settlement and Restrictive Covenant Agreement.
Chief Financial Officer (Blue Foundry)	Kelly Pecoraro	N/A (employment ceases)	Effective Date of Merger	Employment ceases upon merger, superseded by Settlement and Restrictive Covenant Agreement.
Directors (Blue Foundry Bank)	Existing Directors	N/A (resignations)	Effective Date of Merger	Resignations requested by Fulton Bank, contingent upon closing.
Directors and Officers (Fulton/Surviving Corporation)	Existing Directors and Officers of Fulton	Same as previous	Effective Date of Merger	Will continue to serve as directors and officers of the Surviving Corporation.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Governing Documents	Fulton's Amended and Restated Articles of Incorporation and Amended Bylaws will be the governing documents of the Surviving Corporation.	Effective Time of Merger	Blue Foundry stockholders will have their rights governed by Pennsylvania law and Fulton's corporate documents, which differ from Delaware law and Blue Foundry's documents.
Board Declassification Plan	Blue Foundry's 2022 plan to declassify its board by the 2027 annual meeting will likely be superseded by Fulton's governance structure, which currently elects directors annually as a single class.	Effective Time of Merger	The declassification plan for Blue Foundry will become irrelevant as its corporate existence terminates.
Anti-Takeover Provisions	Fulton's articles and bylaws contain various anti-takeover provisions, including preferred stock, supermajority approval for certain transactions, and restrictions on shareholder actions. Fulton has not opted out of Pennsylvania's anti-takeover statutes.	Effective Time of Merger	Former Blue Foundry stockholders, as Fulton shareholders, will be subject to these provisions, which may discourage future unsolicited takeover bids and limit their ability to realize a premium over market price.
Appraisal Rights	Blue Foundry stockholders are not entitled to appraisal rights under Delaware law in connection with the merger.	Effective Time of Merger	Stockholders cannot demand fair value for their shares in a judicial proceeding, limiting their recourse if they disagree with the merger consideration.
Voting Agreements	Certain Blue Foundry officers and directors have entered into voting agreements with Fulton, committing to vote their shares (approximately 4% of outstanding shares) in favor of the merger.	November 24, 2025	These agreements provide a baseline of support for the merger proposal, increasing the likelihood of stockholder approval.

Legal Proceedings

Neither Blue Foundry nor its subsidiaries are currently a party to any material legal, administrative, arbitral, or other proceedings, claims, actions, or governmental/regulatory investigations, nor are any threatened, that would have a Material Adverse Effect on the Company.
There are no material injunctions, orders, judgments, decrees, or regulatory restrictions imposed upon Blue Foundry or its assets.
A risk factor highlights the potential for claims and litigation pertaining to the merger that could prevent or delay completion and result in additional costs to Fulton and Blue Foundry.

Related Party Transactions

No material transactions, agreements, arrangements, or understandings exist between Blue Foundry or its subsidiaries and any current or former director, executive officer, or 5% beneficial owner (or their affiliates), other than those available to employees generally or deposits held in the ordinary course of business.
A list of all outstanding Company Loans to directors, officers, and principal stockholders is provided in the Company Disclosure Schedules, with assurances that these loans comply with Regulation O and applicable laws.

Stakeholder Impact

**Shareholders (Blue Foundry)**: Will receive a significant premium for their shares and gain liquidity, transitioning to shareholders of a larger, more diversified entity (Fulton). However, they will have a reduced ownership and voting interest and will not have appraisal rights.
**Shareholders (Fulton)**: Expected to benefit from EPS and tangible book value accretion, and strategic expansion. They face potential dilution from the issuance of new shares and integration risks.
**Employees (Blue Foundry)**: Continuing employees will have their base salaries/wages and annual cash bonus opportunities protected for a period, receive substantially comparable benefits, and have service credit recognized. Key executives (CEO, CFO) will receive substantial severance payments upon termination. Other employees face the risk of involuntary termination, with severance benefits under Fulton's policy.
**Customers (Blue Foundry Bank)**: Will become customers of Fulton Bank, N.A., potentially gaining access to a broader range of services and a larger branch network, but may experience some disruption during the integration process.
**Suppliers and Business Partners**: May experience changes in existing business relationships due to the merger, with potential for disruption or renegotiation of contracts.

Next Steps

Blue Foundry stockholders will vote on the merger agreement and an adjournment proposal at a special meeting on January 29, 2026.
Fulton and Blue Foundry must obtain all requisite regulatory approvals from the Federal Reserve Board, the Office of the Comptroller of the Currency (OCC), and the New Jersey Department of Banking and Insurance (NJDOBI).
The S-4 registration statement, which includes this proxy statement/prospectus, must be declared effective by the SEC.
Fulton will file a notification for the listing of its common stock to be issued in the merger on Nasdaq.
Blue Foundry Bank will terminate its Employee Stock Ownership Plan (ESOP) prior to the closing date of the merger.
An exchange agent will mail transmittal letters and instructions to Blue Foundry stockholders for exchanging their shares after the merger is completed.
Blue Foundry common stock will be delisted from Nasdaq and deregistered under the Securities Exchange Act of 1934 following the merger's completion.

Key Dates

Date	Description
July 15, 2021	Blue Foundry became the holding company for Blue Foundry Bank following its mutual-to-stock conversion.
July 16, 2021	Shares of Blue Foundry's common stock began trading on Nasdaq.
June 2022	Blue Foundry Bank amended and froze its Director Retirement Plan.
June 2023	Blue Foundry's board of directors engaged Piper Sandler & Co. to assist in identifying ways to increase long-term shareholder value, including assessing a possible merger and acquisition transaction.
August 16, 2023	Piper Sandler & Co. provided an update to the Blue Foundry board on the banking industry and M&A market.
November 20, 2024	Blue Foundry's board discussed financial projections and authorized Piper Sandler & Co. to pursue potential strategic transactions with third parties.
August 19, 2025	Fulton and Blue Foundry entered into a mutual confidentiality agreement.
September 17, 2025	Blue Foundry's CEO and Piper Sandler & Co. representatives provided a status report to the board on potential transaction parameters.
September 29, 2025	Fulton submitted a non-binding indication of interest for an all-stock merger transaction with Blue Foundry.
September 30, 2025	Financial metrics for Fulton and Blue Foundry were reported as of this date.
October 31, 2025	Holland & Knight LLP, Fulton's legal advisor, delivered the first draft of the merger agreement.
November 19, 2025	Blue Foundry's board held an executive session to discuss the proposed transaction, including financial analysis and legal terms.
November 21, 2025	Last trading day before the public announcement of the merger; Fulton common stock closed at $17.96, Blue Foundry common stock closed at $7.92.
November 23, 2025	Blue Foundry's board of directors unanimously approved the merger agreement; Piper Sandler & Co. rendered its fairness opinion.
November 24, 2025	Fulton's board of directors approved the merger agreement; Fulton and Blue Foundry executed the merger agreement and issued a joint press release.
December 8, 2025	Date used for calculating unvested restricted stock and outstanding options held by Blue Foundry directors and executive officers.
December 18, 2025	Record date for Blue Foundry's special meeting of stockholders.
December 19, 2025	Last practicable trading day before the date of the proxy statement/prospectus; Fulton common stock closed at $20.19, Blue Foundry common stock closed at $12.62.
December 23, 2025	Date of the accompanying proxy statement/prospectus.
December 30, 2025	On or about date for mailing or delivery of the proxy statement/prospectus to Blue Foundry stockholders.
January 15, 2026	Date on or after which Fulton may redeem its Series A Preferred Stock.
January 22, 2026	Deadline for Blue Foundry stockholders to request documents for the special meeting; deadline for returning ESOP and 401(k) proxy cards.
January 28, 2026	Deadline for telephone and internet voting for Blue Foundry stockholders.
January 29, 2026	Blue Foundry special meeting of stockholders to be held via live webcast at 11:00 a.m., Eastern Time.
March 16, 2026	Deadline for a stockholder intending to engage in a director election contest at next year's annual meeting to give Blue Foundry notice of intent to solicit proxies (if merger not completed).
August 24, 2026	Termination date for the merger agreement, if the merger is not consummated by this date.
December 31, 2026	End date for certain employee compensation and bonus opportunity protections.
2027	Target year by which Blue Foundry's board of directors planned to be fully declassified, with all directors elected for one-year terms (plan approved in 2022).

Keywords

Merger, Acquisition, Banking, Financial Services, SEC Filing, Proxy Statement, Stockholders Meeting, Fulton Financial Corporation, Blue Foundry Bancorp, All-Stock Transaction, Exchange Ratio, Regulatory Approvals, Corporate Governance, Risk Management, Financial Performance, Shareholder Value, Integration, Employee Stock Ownership Plan, Executive Compensation, Nasdaq, New Jersey Banking Market

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