Company: NWFL
Filing Date: 2025-07-07
Form Type: 8-K
Source: 0001193125-25-156255
Chunk: 1

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-07-07
Form: 8-K
Item: Item 1.01
Chunk 1
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 with third parties relating to any acquisition proposal.

The Merger Agreement may be terminated under certain conditions, including, among others, if the closing of the Merger has not been completed by July 31, 2026. In addition, prior to obtaining shareholder approval of the Merger, PB Bankshares may terminate the Merger Agreement under certain circumstances, including the good faith determination by its board of directors that it has received an unsolicited bona fide “superior proposal,” which remains a superior proposal after any proposed modification of the Merger Agreement, if any, by Norwood Financial. In addition, Norwood Financial may terminate the Agreement if (A) Bankshares fails to hold its shareholder meeting to vote on the Merger Agreement within the time frame set forth in the Merger Agreement, or (B) if Bankshares Board of Directors either (i) fails to recommend that the shareholders of Bankshares vote in favor of the adoption of the Merger Agreement, or (ii) makes a Change in Recommendation (as defined in the Merger Agreement). If the Merger Agreement is terminated under certain circumstances, PB Bankshares must pay a termination fee of $2.4 million.

In addition, PB Bankshares may terminate the Merger Agreement if the price of Norwood Financial’s common stock both (1) declines by more than 20% from its Initial Norwood Market Value (as defined in the Merger Agreement) of $25.77 as of July 3, 2025, as compared to the average over a ten-day trading period ending shortly before closing and (2) declines by more than 20% than any decline in the KBW NASDAQ Regional Bank Index, using the same time periods, unless Norwood Financial adjusts the merger consideration to make up the difference, in which case PB Bankshares will still be required to complete the Merger.

Concurrent with the entering into of the Merger Agreement, PB Bankshares President and CEO, Janak M. Amin, entered into an Employment Agreement and a Non-Competition and Non-Solicitation agreement with Norwood Financial and Wayne Bank. In addition, selected PB Bankshares executives are expected to continue employment with Norwood Financial after completion of the Merger.

Pursuant to the terms of the Merger Agreement, on or immediately after the effective time of the Merger, and subject only to any applicable regulatory approvals and Norwood Financial’s customary background screening and evaluation procedures for potential directors, Norwood Financial will appoint two former non-employee directors of