SCHEDULE: Ford Entities Acquire 78.1% of Mechanics Bancorp Post-Merger

A group of Ford-affiliated entities and Carl B. Webb have reported beneficial ownership of 78.1% of Mechanics Bancorp's Class A common stock following a recent merger.

Summary

• Reporting persons, including EB Acquisition Company LLC, EB Acquisition Company II LLC, Ford Financial Funds, Ford Management entities, Ford Ultimate Management II, LLC, and Carl B. Webb, have filed a Schedule 13D.
• The filing reports beneficial ownership of Class A common stock in Mechanics Bancorp, which was formerly HomeStreet, Inc.
• This ownership resulted from a merger completed on September 2, 2025, where HomeStreet Bank merged into Mechanics Bank, with Mechanics Bank becoming a wholly-owned subsidiary of the Issuer.
• HomeStreet, Inc. subsequently changed its name to Mechanics Bancorp.
• EB Acquisition Company LLC acquired 81,134,239 shares, representing 36.9% of the Class A common stock.
• EB Acquisition Company II LLC acquired 90,631,480 shares, representing 41.2% of the Class A common stock.
• Collectively, Ford Ultimate Management II, LLC and Carl B. Webb beneficially own 171,765,719 shares, which is 78.1% of the outstanding Class A common stock.
• The shares were acquired through the conversion of Mechanics voting common stock at a rate of 3,301.0920 shares of Class A common stock per Mechanics voting common stock.
• The total outstanding Class A common stock of Mechanics Bancorp as of September 2, 2025, was 219,822,191 shares.
• The funds for acquiring the Mechanics voting common stock came from capital contributions by the members of EB Acquisition Company LLC and EB Acquisition Company II LLC.

Sentiment

Score: 7

Explanation: The filing indicates the successful completion of a merger and the establishment of a significant, controlling ownership stake by a group of investment entities, suggesting a positive strategic development for the company. The intent is for investment purposes to increase value, and the reporting persons have secured registration rights for future liquidity.

Positives

• The reporting persons acquired a significant controlling stake (78.1%) in Mechanics Bancorp, indicating strong conviction in the company's future.
• The merger has been consummated, leading to the formation of Mechanics Bancorp as the parent company of the surviving Mechanics Bank.
• A Registration Rights Agreement provides the Ford Parties and Rabobank with certain demand, shelf takedown, and piggyback registration rights, offering liquidity options for their substantial holdings.

Risks

• The reporting persons reserve the right to dispose of all or a portion of their securities, which could impact market liquidity and share price.
• The reporting persons may propose or participate in future extraordinary corporate transactions, changes to the board or management, dividend policy, or business, which could alter the company's strategic direction.

Future Outlook

The reporting persons intend to hold their securities for investment purposes and may acquire additional shares or dispose of existing holdings based on their evaluation of Mechanics Bancorp's business, prospects, and market conditions. They also reserve the right to propose or participate in significant corporate actions, including extraordinary transactions, changes to management or the board, dividend policy, or the company's business. The Issuer is required to file a resale shelf registration statement within 180 days of the merger closing.

Management Comments

• Carl B. Webb, as sole manager of Ford Ultimate Management II, LLC, exercises sole voting and dispositive power over the beneficially owned securities.
• Carl B. Webb is a member of the board of directors of Mechanics Bancorp and may influence corporate activities.

Industry Context

This filing reflects a significant ownership change in the banking sector, following a merger between HomeStreet Bank and Mechanics Bank, with the combined entity now operating under the Mechanics Bancorp name. The substantial stake acquired by the Ford-affiliated entities suggests a strategic investment in the regional banking market, potentially aiming for long-term value creation through active involvement in governance and strategic direction. Such large-scale beneficial ownership filings often precede or accompany significant strategic shifts or integration efforts within the financial services industry.

Comparison to Industry Standards

• The acquisition of a 78.1% stake by a single group of affiliated entities is a substantial controlling interest, far exceeding typical institutional investor positions and indicating a strategic, rather than purely passive, investment. This level of ownership is comparable to that seen in private equity buyouts or strategic acquisitions where the acquirer seeks significant influence or control over the target company's operations and future direction.
• The inclusion of demand and piggyback registration rights in the Registration Rights Agreement is a standard provision for large, strategic investors, providing a mechanism for future liquidity while managing market impact.

Corporate Governance

Related Party Transactions

• The shares were acquired by EB Acquisition Company LLC and EB Acquisition Company II LLC, which are part of the Ford-affiliated group, from capital contributions by their members.
• A Joint Filing Agreement was entered into by all Reporting Persons.
• A Registration Rights Agreement was entered into by the Ford Parties, the Issuer, Mechanics Bank, and Rabobank International Holding B.V.

Stakeholder Impact

• Shareholders: Existing shareholders will see a significant concentration of ownership (78.1%) by the Ford-affiliated group, potentially impacting liquidity and control. The registration rights agreement could facilitate future sales by these large holders.
• Employees: The merger and subsequent ownership structure could lead to integration efforts, which may impact employees of the former HomeStreet Bank and Mechanics Bank.
• Customers: The name change to Mechanics Bancorp and the merger of HomeStreet Bank into Mechanics Bank will affect customers, likely through branding and operational integration.
• Management: Carl B. Webb, as a director and representative of the controlling shareholder group, will have significant influence over management and strategic decisions.

Next Steps

• The Issuer is required to use reasonable best efforts to file a resale shelf registration statement on Form S-3 covering the acquired shares within 180 days of September 2, 2025.
• The Reporting Persons may acquire additional securities or dispose of existing holdings in the future.
• The Reporting Persons reserve the right to propose or participate in extraordinary corporate transactions or changes to the Issuer's governance and business.

Key Dates

Recommendation

This filing primarily reports a change in beneficial ownership following a merger, rather than new operational or financial performance data. The significant concentration of ownership by the Ford-affiliated entities, while indicating strong commitment, also introduces potential for future strategic shifts or large-scale share dispositions. Without further details on the post-merger financial performance or strategic plans, a 'hold' recommendation is prudent, advising investors to await more comprehensive operational updates and clarity on the long-term strategy under the new ownership structure. The registration rights agreement provides a future mechanism for liquidity for the large holders, which could create selling pressure if exercised.

Keywords

Mechanics Bancorp, HomeStreet Inc, Schedule 13D, beneficial ownership, merger, bank acquisition, Carl B. Webb, Ford Financial Fund, corporate governance, banking industry, financial services, Class A common stock, registration rights