Company: CCNE
Filing Date: 2025-02-20
Form Type: S-4
Source: 0001193125-25-030821
Chunk: 41

Company: CNB FINANCIAL CORP/PA
Filing Date: 2025-02-20
Form: S-4
Chunk 41
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 of the merger, ESSA shareholders will become CNB shareholders. Differences in ESSA’s charter and bylaws and CNB’s charter and bylaws will result in changes to the rights of ESSA shareholders who become CNB shareholders. For more information, see the section entitled “Comparison of Shareholder Rights” beginning on page 174.

ESSA will be subject to business uncertainties and contractual restrictions while the merger is pending.

Uncertainty about the effect of the merger on ESSA’s employees, suppliers and customers may have an adverse effect on ESSA. These uncertainties may impair ESSA’s ability to attract, retain and motivate key personnel until the merger is completed, and could cause customers, suppliers and others who deal with ESSA to seek to change**

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**existing business relationships with ESSA. ESSA employee retention and recruitment may be particularly challenging prior to the effective time of the merger, as employees and prospective employees may experience uncertainty about their future roles with CNB.

The pursuit of the merger and the preparation for the integration may place a significant burden on management and internal resources. Any significant diversion of management attention away from ongoing business and any difficulties encountered in the transition and integration process could affect the financial results of ESSA and, following the merger, CNB. In addition, the merger agreement requires that ESSA operate in the ordinary course of business consistent with past practice and restricts ESSA from taking certain actions prior to the effective time of the merger or termination of the merger agreement without CNB’s written consent. These restrictions may prevent ESSA from retaining existing customers or pursuing attractive business opportunities that may arise prior to the completion of the merger.

The merger agreement contains provisions that limit ESSA’s ability to pursue alternatives to the merger and may discourage other companies from trying to acquire ESSA.

The merger agreement contains covenants that restrict ESSA’s ability to, directly or indirectly, initiate, solicit, induce, knowingly encourage, or knowingly facilitate inquiries, offers or proposals with respect to, or, subject to certain exceptions generally related to the exercise of fiduciary duties by the ESSA Board of Directors, engage in any negotiations concerning, or provide any confidential or non-public information or data relating to, any alternative acquisition proposals. Additionally, the merger agreement provides for an $8.8 million termination fee payable by ESSA to CNB under certain circumstances. Such provisions may discourage a potential third-party acquirer that might