Company: MCHB
Filing Date: 2025-07-03
Form Type: S-4
Source: 0001140361-25-024872
Chunk: 94

Company: Mechanics Bancorp
Filing Date: 2025-07-03
Form: S-4
Chunk 94
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 could cause delays in customer activity. Such delays could cause substantial losses for customers and could subject Mechanics to claims from customers for losses, including litigation claiming fraud or negligence. In addition, if Mechanics’ computer and communications systems fail to operate properly, regulations would restrict Mechanics’ ability to conduct business. Any such failure could prevent Mechanics from collecting funds relating to customer and client transactions, which would materially impact Mechanics’ cash flows. Any computer or communications system failure or decrease in computer system performance that causes interruptions in Mechanics’ operations could have a material adverse effect on Mechanics’ business, financial condition, results of operations or cash flows.

**Climate change could adversely affect Mechanics’ business and performance, including indirectly through impacts on Mechanics’ customers.**

Concerns over the long-term impacts of climate change have led, and may continue to lead, to governmental efforts in the United States to mitigate those impacts. Consumers and businesses also may change their behavior as a result of these concerns. Mechanics’ customers will need to respond to new laws and regulations, as well as consumer and business preferences resulting from climate change concerns. Mechanics’ customers may face cost increases, asset value reductions and operating process changes. The impact on Mechanics’ customers will likely vary depending on their specific attributes, including reliance on or role in carbon intensive activities. Mechanics’ efforts to take these risks into account in making lending and other decisions may not be effective in protecting it from the negative impact of new laws and regulations or changes in consumer or business behavior.

**Mechanics is subject to environmental liability risk associated with lending activities.**

A significant portion of Mechanics’ loan portfolio is secured by real property. In the ordinary course of business, Mechanics may foreclose on and take title to properties securing certain loans. In doing so, there is a risk that hazardous or toxic substances could be found on these properties. If hazardous or toxic substances are found, Mechanics may be liable for remediation costs, as well as for personal injury and property damage. Environmental laws may require Mechanics to incur substantial expenses and may materially reduce the affected property’s value or limit Mechanics’ ability to use or sell the affected property. In addition, future laws or more stringent interpretations or enforcement policies with respect to existing laws may increase Mechanics’ exposure to environmental liability. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material and adverse effect on Mechanics’ business, financial condition and results of operations.

**Mechanics may fail to adapt our services to changes in the marketplace related to mortgage servicing or origination, technology or in changing