8-K: Eastern Bankshares, HarborOne Merger Election Forms Mailed

Eastern Bankshares and HarborOne Bancorp jointly announced the distribution of election forms to HarborOne shareholders for the pending merger, allowing them to choose between stock, cash, or a combination.

Summary

• Eastern Bankshares, Inc. (Eastern) and HarborOne Bancorp, Inc. (HarborOne) have distributed election forms to holders of HarborOne common stock.
• HarborOne shareholders can elect to receive Eastern common stock, cash, or a combination of both as consideration for their shares in the pending merger.
• The merger involves HarborOne merging into Eastern, and HarborOne Bank merging into Eastern Bank.
• HarborOne shareholders approved the Merger Agreement on August 20, 2025.
• Eastern anticipates all required regulatory approvals and closing conditions will be satisfied by October 31, 2025.
• The Holdco Merger and Bank Merger are expected to become effective on November 1, 2025, at 12:01 a.m. and 12:02 a.m. respectively.
• The anticipated election deadline for general HarborOne shareholders is 5:00 P.M. (Eastern Time) on October 28, 2025.
• An earlier election deadline of 5:00 P.M. (Eastern Time) on October 23, 2025, applies to HarborOne ESOP and 401(k) plan participants.
• The definitive election deadline will be announced at least 5 business days (but not more than 15 business days) prior to the deadline.
• Merger consideration options include 0.765 shares of Eastern common stock per HarborOne share, or $12.00 cash per HarborOne share, or a combination.
• Allocation and proration provisions in the Merger Agreement ensure that 75% to 85% of aggregate HarborOne shares will receive Stock Consideration, with the remainder receiving Cash Consideration.
• HarborOne shareholders who do not make a proper election by the deadline will have their shares exchanged for stock, cash, or a combination based on other shareholders' elections and proration procedures.

Sentiment

Score: 7

Explanation: The filing indicates steady progress on a major corporate action (merger), which is generally positive for market certainty. The shareholder election process is a standard step, and the anticipated closing date remains on track. However, the extensive list of forward-looking risks inherent in any large transaction prevents a higher score.

Positives

• The merger is progressing as planned, with HarborOne shareholder approval already secured.
• A clear timeline for the anticipated closing date of November 1, 2025, has been provided.
• HarborOne shareholders are offered flexibility to choose between stock and cash consideration for their shares.
• Eastern Bank reported approximately $25.5 billion in assets as of June 30, 2025, indicating a strong financial base.
• Eastern Bank's Cambridge Trust Wealth Management division manages $8.7 billion in assets, highlighting a robust wealth management segment.

Risks

• Revenue or expense synergies or other expected benefits of the Merger Transaction may not materialize in the timeframe expected or at all, or may be more costly to achieve.
• The Merger Transaction may not be timely completed, if at all.
• Prior to or after the completion of the Merger Transaction, Eastern or HarborOne may not perform as expected due to merger-related uncertainty or other factors.
• Eastern may be unable to successfully implement its integration strategies.
• Required regulatory or other approvals may not be obtained, or closing conditions not satisfied in a timely manner or at all.
• The timing of completion of the proposed Merger Transaction is dependent on various factors that cannot be predicted with precision.
• Reputational risks and the reaction of the companies' customers to the Merger Transaction.
• Inability to implement onboarding or transition plans and other consequences associated with the merger.
• Continued pressures and uncertainties within the banking industry and Eastern and HarborOne's markets, including changes in interest rates and deposit amounts and composition.
• Adverse developments in the level and direction of loan delinquencies, charge-offs, and estimates of the adequacy of the allowance for loan losses.
• Increased competitive pressures, asset and credit quality deterioration.
• Legislative, regulatory, and fiscal policy changes and related compliance costs.
• Diversion of management time on Merger Transaction-related issues.
• There is no assurance that all required regulatory approvals, waivers or consents will be obtained, when they will be obtained, or whether there will be burdensome conditions in the approvals or any litigation challenging the approvals.

Future Outlook

Eastern anticipates all required regulatory approvals and closing conditions for the merger with HarborOne will be satisfied by October 31, 2025, with the merger becoming effective on November 1, 2025. However, there is no assurance regarding the timing or conditions of regulatory approvals or potential litigation challenging these approvals.

Management Comments

• Eastern continues to anticipate that all required approvals will be received and all of the other closing conditions will be satisfied by October 31, 2025, and the Holdco Merger and the Bank Merger will become effective as of 12:01 a.m. and 12:02 a.m., respectively, on November 1, 2025.

Industry Context

The merger between Eastern Bankshares and HarborOne Bancorp signifies ongoing consolidation within the regional banking sector, particularly in the Northeastern U.S. This strategic move aims to enhance market presence and potentially achieve operational efficiencies and synergies in a competitive financial landscape, which is currently influenced by fluctuating interest rates and evolving regulatory requirements.

Legal Proceedings

• Risk of potential litigation challenging regulatory approvals for the merger.

Stakeholder Impact

• Shareholders (HarborOne): Will receive merger consideration (stock, cash, or a combination) for their shares, subject to allocation and proration.
• Shareholders (Eastern): Will experience dilution from new share issuance and potential benefits from merger synergies and expanded market presence.
• Customers (Both Banks): May experience changes in banking services, branch networks, and product offerings post-merger.
• Employees (Both Banks): Potential for integration challenges, changes in roles, or workforce adjustments as the two entities combine.
• Regulatory Authorities: Involved in reviewing and approving the merger, ensuring compliance with banking regulations.

Next Steps

• HarborOne shareholders must submit their election forms by the anticipated deadline of October 28, 2025 (October 23, 2025 for ESOP/401k participants).
• Eastern and HarborOne intend to announce the definitive election deadline at least 5 business days (but not more than 15 business days) prior to the deadline.
• Eastern needs to receive all remaining required regulatory approvals for the merger.
• All other closing conditions for the merger must be satisfied.
• The Holdco Merger and Bank Merger are expected to become effective on November 1, 2025.

Key Dates

Recommendation

The filing confirms the merger is proceeding as expected, with key procedural steps like the shareholder election process underway. This reduces uncertainty around the transaction's completion. For HarborOne shareholders, the decision to elect cash or stock depends on individual investment goals and tax considerations, but the merger itself is on track. For Eastern shareholders, the update is neutral as it confirms previously announced plans. The inherent risks associated with integration and achieving synergies remain, suggesting a 'hold' position until more post-merger performance data is available.

Keywords

Eastern Bankshares, HarborOne Bancorp, Merger, Acquisition, Bank Merger, Shareholder Election, Stock Consideration, Cash Consideration, Banking Industry, Financial Services, EBC, HONE