Form 4: CFSB Bancorp Insider Disposes Shares Post-Merger

Angela Blanchard, VP-Retail Lending at CFSB Bancorp, Inc., disposed of all her beneficial ownership in the company following its merger with Hometown Financial Group.

Summary

• Reporting Person Angela Blanchard, VP-Retail Lending of CFSB Bancorp, Inc., disposed of all her beneficial ownership in the company.
• The disposition occurred on October 31, 2025, pursuant to an Agreement and Plan of Merger dated May 20, 2025.
• CFSB Bancorp, Inc. was acquired by Hometown Financial Group, MHC, Hometown Financial Group, Inc., and Hometown Financial Acquisition Corp. II.
• Each outstanding share of Common Stock of CFSB Bancorp, Inc. was converted into the right to receive cash in the amount of $14.25 per share.
• All unvested shares of restricted stock automatically vested in full at the effective time of the merger and were converted into cash at the merger consideration price.
• Outstanding and unexercised stock options were cancelled in exchange for cash, calculated as the product of (i) the excess of the merger consideration ($14.25) over the per share exercise price ($7.99), multiplied by (ii) the number of shares subject to the option (14,000 options).

Sentiment

Score: 7

Explanation: The filing reports the final disposition of securities by an insider due to a merger, indicating a successful cash-out for the reporting person's equity holdings. While it signifies the end of CFSB Bancorp, Inc. as an independent entity, the transaction itself is a planned corporate action with a defined cash consideration, which is generally a positive outcome for shareholders receiving a premium.

Positives

• The reporting person received cash for all equity holdings, including previously unvested restricted stock and options, due to the merger.
• The merger consideration of $14.25 per share provided a clear and defined exit value for shareholders.

Negatives

• CFSB Bancorp, Inc. ceases to exist as an independent publicly traded entity following the merger.
• Shareholders no longer hold equity in CFSB Bancorp, Inc.

Future Outlook

The filing indicates the completion of the merger of CFSB Bancorp, Inc. with Hometown Financial Group, resulting in the cessation of CFSB Bancorp, Inc. as an independent entity. No forward-looking statements for the combined entity are provided in this specific Form 4.

Management Comments

• Pursuant to the Agreement and Plan of Merger dated as of May 20, 2025, by and among Hometown Financial Group, MHC, Hometown Financial Group, Inc., Hometown Financial Acquisition Corp. II, 15 Beach, MHC and the Issuer (the "Merger Agreement"), at the Effective Time (as defined in the Merger Agreement), each issued and outstanding share of Common Stock of the Issuer was converted automatically into the right to receive cash in an amount equal to $14.25 per share without interest (the "Merger Consideration").
• Pursuant to the Merger Agreement, all unvested shares of restricted stock automatically vested in full at the Effective Time, and were considered outstanding shares of common stock entitled to receive the Merger Consideration, net of all applicable withholding taxes.
• Pursuant to the Merger Agreement, each outstanding and unexercised option immediately prior to the Effective Time, whether vested or unvested, was cancelled in exchange for the right to receive an amount in cash equal to the product of (i) the excess, if any, of the Merger Consideration over the per share exercise price of such option, multiplied by (ii) the number of shares of Common Stock then subject to such option, net of all applicable withholding taxes.

Industry Context

This filing reflects a consolidation event within the banking sector, where smaller regional banks like CFSB Bancorp, Inc. are acquired by larger financial groups such as Hometown Financial Group. Such mergers are common strategies for achieving economies of scale, expanding market reach, and navigating regulatory landscapes in a competitive financial services industry.

Comparison to Industry Standards

• The merger consideration of $14.25 per share for CFSB Bancorp, Inc. common stock, and the treatment of options and restricted stock, aligns with standard practices in financial sector mergers and acquisitions.
• Similar cash-out mergers have been observed in the regional banking space, such as the acquisition of Sterling Bancorp by Webster Financial Corporation, or the acquisition of People's United Financial by M&T Bank Corporation, where shareholders received a predetermined cash or stock consideration for their shares.
• The mechanism of cash consideration for equity and options is standard for such transactions, providing a clear exit for shareholders and equity holders of the acquired entity.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: Received cash consideration of $14.25 per share, ceasing to be shareholders of CFSB Bancorp, Inc.
• Employees: Employment status with the acquired entity would transition to the acquiring entity or be terminated, depending on the merger terms. The disposition of equity indicates a final settlement of equity-based compensation.
• Customers: Will now be customers of Hometown Financial Group, potentially experiencing changes in services or branding.

Key Dates

Keywords

CFSB Bancorp, CFSB, Hometown Financial Group, Merger, Acquisition, Form 4, Insider Transaction, Stock Options, Restricted Stock, Cash Consideration, Banking Sector