S-4 1 d112098ds4.htm S-4 S-4
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As filed with the Securities and Exchange Commission on April 1, 2021

Registration No. 333-          

 

 

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

M&T Bank Corporation

(Exact name of Registrant as specified in its charter)

 

 

 

New York   6022   16-0968385
(State or other jurisdiction of
incorporation or organization)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification No.)

One M&T Plaza

Buffalo, New York 14203

(716) 842-5445

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

 

 

Laura P. O’Hara

Executive Vice President and General Counsel

M&T Bank Corporation

One M&T Plaza

Buffalo, New York 14203

Phone: (716) 842-5445

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

Copies to:

 

H. Rodgin Cohen
Mark J. Menting
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004
(212) 558-4000
 

Kristy Berner

Executive Vice President, General Counsel and Corporate Secretary

People’s United Financial, Inc.

850 Main Street

Bridgeport, Connecticut 06604

(203) 338-7171

  Lee Meyerson
Sebastian Tiller
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
(212) 455-2000

 

 

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement is declared effective and upon completion of the merger described herein.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐


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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer      Smaller reporting company  
     Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.  ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  ☐

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of
Securities to Be Registered
  Amount
to Be
Registered
  Proposed
Maximum
Offering Price
per Unit
  Proposed
Maximum
Aggregate
Offering Price
  Amount of
Registration Fee(5)

Common Stock, par value $0.50 per share

  54,740,623(1)   N/A   $8,076,561,327.80(3)   $881,152.84

Perpetual Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series H, par value $1.00 per share

  10,000,000(2)   N/A   $250,000,000(4)   $27,275

 

 

(1)

The number of shares of common stock, par value $0.50 per share, of M&T Bank Corporation (“M&T” and such shares, the “M&T common stock”) being registered is based upon an estimate of (i) the exchange ratio of 0.118 of a share of M&T common stock for each share of common stock, par value $0.01 per share, of People’s United Financial, Inc. (“People’s United” and, such shares, the “People’s United common stock”) multiplied by (ii) the sum of: (x) 426,356,921 shares of People’s United common stock outstanding as of March 26, 2021, plus (y) the estimated maximum number of shares of People’s United common stock reserved for issuance under People’s United’s various equity award plans, which equals to 37,546,659 as of March 26, 2021.

(2)

Represents the maximum number of shares of Perpetual Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series H, par value $1.00 per share, of M&T (“new M&T preferred stock”) estimated to be issued to holders of record of the Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01, of People’s United (“People’s United Preferred Stock”) in the merger described herein. This number is based on the number of shares of People’s United preferred stock outstanding as of March 26, 2021, and the exchange of each such share for a share of new M&T preferred stock, pursuant to the Agreement and Plan of Merger, dated February 21, 2021, by and among M&T, Bridge Merger Corp. and People’s United.

(3)

Estimated solely for the purpose of calculating the registration fee required by Section 6(b) of the Securities Act of 1933, as amended (the “Securities Act”) and calculated in accordance with Rules 457(c) and 457(f)(1) promulgated thereunder. The aggregate offering price is (x) the average of the high and low prices of People’s United common stock as reported on the NASDAQ Global Select Market on March 25, 2021 ($17.41) multiplied by (y) the estimated maximum number of shares of People’s United common stock to be converted in the merger (463,903,580).

(4)

Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(f) under the Securities Act. The aggregate offering price is (x) the book value per share of People’s United preferred stock as of March 26, 2021 ($25) multiplied by (y) the maximum number of shares of People’s United preferred stock to be converted in the merger (10,000,000).

(5)

Calculated by multiplying the estimated aggregate offering price of securities to be registered by 0.0001091.

 

 

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(a) MAY DETERMINE.

 

 

 


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The information in this joint proxy statement/prospectus is not complete and may be changed. A registration statement relating to the securities described in this joint proxy statement/prospectus has been filed with the U.S. Securities and Exchange Commission. These securities may not be issued until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This joint proxy statement/prospectus does not constitute an offer to sell or the solicitation of offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

PRELIMINARY—SUBJECT TO COMPLETION—DATED APRIL 1, 2021

 

LOGO    LOGO

To the Shareholders of M&T Bank Corporation and the Stockholders of People’s United Financial, Inc.

MERGER PROPOSED—YOUR VOTE IS VERY IMPORTANT

On behalf of the boards of directors of M&T Bank Corporation (“M&T”) and People’s United Financial, Inc. (“People’s United”), we are pleased to enclose the accompanying joint proxy statement/prospectus relating to the acquisition of People’s United by M&T. We are requesting that you take certain actions as a holder of M&T common stock (an “M&T shareholder” or “shareholder”) or as a holder of People’s United common stock (a “People’s United stockholder” or “stockholder”).

On February 21, 2021, M&T, Bridge Merger Corp., a direct, wholly owned subsidiary of M&T (“Merger Sub”), and People’s United entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”), pursuant to which M&T will, upon the terms and subject to the conditions set forth in the merger agreement, acquire People’s United in an all-stock transaction. The acquisition will create a diversified, community-focused banking franchise with approximately $200 billion in assets and a network of more than 1,100 branches and over 2,000 ATMs that spans 12 states from Maine to Virginia and the District of Columbia.

Under the merger agreement, Merger Sub will merge with and into People’s United, with People’s United as the surviving entity (the “merger”), and as soon as reasonably practicable following the merger, People’s United will merge with and into M&T, with M&T as the surviving entity (the “holdco merger”). At a date and time following the holdco merger as determined by M&T, People’s United Bank, National Association, a national banking association and a wholly owned subsidiary of People’s United, will merge with and into Manufacturers and Traders Trust Company, a New York state chartered bank and a wholly owned subsidiary of M&T (“M&T Bank”), with M&T Bank as the surviving bank (the “bank merger,” and together with the merger and the holdco merger, the “mergers”).

In the merger, People’s United stockholders will receive 0.118 of a share of M&T common stock for each share of People’s United common stock they own. Based on the closing price of M&T’s common stock on the New York Stock Exchange on February 19, 2021, the last trading day before the public announcement of the merger, the exchange ratio represented approximately $17.70 in value for each share of People’s United common stock, representing a merger consideration of approximately $7.6 billion on an aggregate basis.

M&T shareholders will continue to own their existing shares of M&T common stock. The value of the M&T common stock at the time of completion of the merger could be greater than, less than or the same as the value of M&T common stock on the date of the accompanying joint proxy statement/prospectus. We urge you to obtain current market quotations of M&T common stock (trading symbol “MTB”) and People’s United common stock (trading symbol “PBCT”).

In addition, each share of fixed-to-floating rate non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of People’s United (“People’s United preferred stock”) will be converted into the right to receive a share of a newly created series of preferred stock of M&T, par value $1.00 per share, having terms that are substantially as set forth in Exhibit A to the merger agreement (the “new M&T preferred stock”). The shares of People’s United preferred stock are currently listed on the NASDAQ Global Select Market under the symbol “PBCTP.” The shares of the new M&T preferred stock are expected to be listed on the New York Stock Exchange upon completion of the merger.

We expect the merger and the holdco merger, taken together, will qualify as a reorganization for federal income tax purposes. Accordingly, People’s United stockholders or holders of People’s United preferred stock generally will not recognize any gain or loss for federal income tax purposes on the exchange of shares of People’s United common stock or People’s United preferred stock, as applicable, for M&T common stock or new M&T preferred stock, as applicable, in the merger, except with respect to any cash received by such holders in lieu of fractional shares of M&T common stock.


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Based on the number of shares of People’s United common stock outstanding or reserved for issuance as of [                ], 2021, M&T expects to issue approximately [      ] million shares of M&T common stock to People’s United stockholders in the aggregate in the merger. We estimate that former People’s United stockholders will own approximately 28% and existing M&T shareholders will own approximately 72% of the common stock of M&T following the completion of the merger.

M&T and People’s United will each hold a virtual special meeting of our respective shareholders and stockholders in connection with the merger. At our respective special meetings, in addition to other business, M&T will ask its shareholders to approve the issuance of its common stock to holders of People’s United common stock pursuant to the merger agreement and an amendment to M&T’s charter to effect an increase in the number of authorized shares of M&T’s capital stock and of its preferred stock, and People’s United will ask its stockholders to approve the adoption of the merger agreement. Information about these meetings and the mergers is contained in this document. We urge you to read this document carefully and in its entirety.

Holders of People’s United preferred stock are not entitled to and are not requested to vote at the People’s United special meeting. Holders of M&T preferred stock are not entitled to and are not requested to vote at the M&T special meeting.

The special meeting of People’s United stockholders will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time. The special meeting of M&T shareholders will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time.

Each of our boards of directors unanimously recommends that holders of common stock vote “FOR” each of the proposals to be considered at the respective meetings. We strongly support this combination of our companies and join our boards in their recommendations.

This joint proxy statement/prospectus provides you with detailed information about the merger agreement and the merger. It also contains or references information about M&T and People’s United and certain related matters. You are encouraged to read this joint proxy statement/prospectus carefully. In particular, you should read the “Risk Factors” section beginning on page 31 for a discussion of the risks you should consider in evaluating the proposed merger and how it will affect you. You can also obtain information about M&T and People’s United from documents that have been filed with the Securities and Exchange Commission that are incorporated into this joint proxy statement/prospectus by reference.

On behalf of the M&T and People’s United boards of directors, thank you for your prompt attention to this important matter.

Sincerely,

 

LOGO    LOGO

René F. Jones

Chairman of the Board and Chief Executive Officer

M&T Bank Corporation

  

John P. Barnes

Chairman of the Board and Chief Executive Officer

People’s United Financial, Inc.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in connection with the merger or determined if this document is accurate or complete. Any representation to the contrary is a criminal offense.

The securities to be issued in the merger are not savings or deposit accounts or other obligations of any bank or non-bank subsidiary of either M&T or People’s United, and they are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

The accompanying joint proxy statement/prospectus is dated [                ], 2021, and is first being mailed to M&T shareholders and People’s United stockholders on or about [                ], 2021.


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ADDITIONAL INFORMATION

The accompanying joint proxy statement/prospectus incorporates important business and financial information about M&T and People’s United from other documents that are not included in or delivered with this document. This information is available to you without charge upon your written or oral request. You can obtain the documents incorporated by reference in this document through the Securities and Exchange Commission website at http://www.sec.gov or by requesting them in writing, by email or by telephone at the appropriate address below. In addition, documents filed with the Securities and Exchange Commission by M&T are available free of charge by accessing M&T’s website at https://www.mtb.com and documents filed with the Securities and Exchange Commission by People’s United are available free of charge by accessing People’s United’s website at http://www.peoples.com.

 

if you are an M&T shareholder:
M&T Bank Corporation
One M&T Plaza
Buffalo, New York 14203
Attn: Shareholder Relations
(716) 842-5138

ir@mtb.com

  

if you are a People’s United stockholder:
People’s United Financial, Inc.
850 Main Street
Bridgeport, Connecticut 06604
Attn: Investor Relations

(203) 338-4581

Andrew.Hersom@peoples.com

You will not be charged for any of these documents that you request. To obtain timely delivery of these documents, you must request them no later than five (5) business days before the date of the applicable special meeting. This means that M&T shareholders requesting documents must do so by [                ], 2021, in order to receive them before the M&T special meeting, and People’s United stockholders requesting documents must do so by [                ], 2021, in order to receive them before the People’s United special meeting.

No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this document. This document is dated [                ], 2021, and you should assume that the information in this document is accurate only as of such date. You should assume that the information incorporated by reference into this document is accurate as of the date of such incorporated document. Neither the mailing of this document to M&T shareholders or People’s United stockholders, nor the issuance by M&T of shares of M&T common stock or new M&T preferred stock pursuant to the merger agreement, will create any implication to the contrary.

This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Except where the context otherwise indicates, information contained in, or incorporated by reference into, this document regarding People’s United has been provided by People’s United and information contained in, or incorporated by reference into, this document regarding M&T has been provided by M&T.

See “Where You Can Find More Information” beginning on page 179 of the accompanying joint proxy statement/prospectus for further information.


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LOGO

M&T Bank Corporation

One M&T Plaza

Buffalo, New York 14203

NOTICE OF VIRTUAL SPECIAL MEETING OF SHAREHOLDERS

To M&T Shareholders:

On February 21, 2021, M&T Bank Corporation, a New York corporation (“M&T”), Bridge Merger Corp., a direct, wholly owned subsidiary of M&T (“Merger Sub”), and People’s United Financial, Inc., a Delaware corporation (“People’s United”), entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”). A copy of the merger agreement is attached as Annex A to the accompanying joint proxy statement/prospectus.

NOTICE IS HEREBY GIVEN that a special meeting of holders of M&T common stock (“M&T shareholders” or “shareholders”) will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time (the “M&T special meeting”). We are pleased to notify you of, and invite you, to the M&T special meeting.

At the M&T special meeting, you will be asked to vote on the following matters:

 

   

a proposal to approve the amendment of the restated certificate of incorporation of M&T to effect an increase in the number of authorized shares of M&T’s capital stock from 251,000,000 to 270,000,000 and to increase the number of authorized shares of M&T’s preferred stock from 1,000,000 to 20,000,000 (the “M&T charter amendment proposal”).

 

   

a proposal to approve the issuance of M&T common stock to holders of People’s United common stock pursuant to the merger agreement (the “M&T share issuance proposal”).

 

   

a proposal to adjourn the M&T special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the M&T charter amendment proposal and/or the M&T share issuance proposal, or to ensure that any supplement or amendment to the accompanying joint proxy statement/prospectus is timely provided to holders of M&T common stock (the “M&T adjournment proposal”).

Due to the continuing public health impact of the COVID-19 pandemic and to support the well-being of our shareholders and employees, we are holding the M&T special meeting in a virtual meeting format exclusively by webcast. No physical meeting will be held. As more fully described in the “Questions & Answers” and “The M&T Special Meeting” sections of the accompanying joint proxy statement/prospectus, you are entitled to participate in the M&T special meeting if, as of the close of business on [                ], 2021, you held shares of M&T common stock registered in your name (a “record holder”), or if you held shares through an intermediary, such as a bank or broker, and have a valid legal proxy for the M&T special meeting (a “beneficial owner”). Both record holders and beneficial owners will be able to attend the M&T special meeting online, ask questions and vote during the meeting by visiting [                ] and following the instructions. The password for the meeting, if requested, is [                ]. Please have your control number, which can be found on your proxy card, notice or email previously received, to access the meeting. See the “Questions & Answers” section of the accompanying joint proxy statement/prospectus for more information, including technical support information for the virtual M&T special meeting.

The board of directors of M&T has fixed the close of business on [                ], 2021 as the record date for the M&T special meeting. Only holders of record of M&T common stock as of the close of business on the record date for the M&T special meeting are entitled to notice of the M&T special meeting or any adjournment or postponement thereof. Only holders of record of M&T common stock will be entitled to vote at the M&T special meeting or any adjournment or postponement thereof.


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M&T has determined that holders of M&T common stock and M&T preferred stock are not entitled to dissenters’ rights with respect to the proposed merger under Section 910 of the New York Business Corporation Law.

The M&T board of directors unanimously recommends that holders of M&T common stock vote “FOR” the M&T charter amendment proposal, “FOR” the M&T share issuance proposal and “FOR” the M&T adjournment proposal.

Your vote is important. We cannot complete the transactions contemplated by the merger agreement unless M&T shareholders approve the M&T charter amendment proposal and the M&T share issuance proposal. The affirmative vote of a majority of the outstanding shares of M&T common stock is required to approve the M&T charter amendment proposal, and a majority of the votes cast by the holders of M&T common stock at the M&T special meeting is required to approve the M&T share issuance proposal.

Whether or not you plan to attend the M&T special meeting, we urge you to please promptly complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope or authorize the individuals named on the accompanying proxy card to vote your shares by calling the toll-free telephone number or by using the internet as described in the instructions included with the accompanying proxy card. If your shares are held in the name of a bank, broker, trustee or other nominee, please follow the instructions on the voting instruction card furnished by such bank, broker, trustee or other nominee.

By Order of the Board of Directors

 

 

LOGO

René F. Jones

Chairman of the Board and Chief Executive Officer

M&T Bank Corporation

[                ], 2021


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LOGO

People’s United Financial, Inc.

850 Main Street

Bridgeport, Connecticut 06604

NOTICE OF VIRTUAL SPECIAL MEETING OF STOCKHOLDERS

To People’s United Stockholders:

On February 21, 2021, People’s United Financial, Inc., a Delaware corporation (“People’s United”), M&T Bank Corporation, a New York corporation (“M&T”), and Bridge Merger Corp., a direct, wholly owned subsidiary of M&T (“Merger Sub”), entered into an Agreement and Plan of Merger (the “merger agreement”). A copy of the merger agreement is attached as Annex A to the accompanying joint proxy statement/prospectus.

NOTICE IS HEREBY GIVEN that a special meeting of holders of People’s United common stock (“People’s United stockholders” or “stockholders”) will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time (the “People’s United special meeting”). We are pleased to notify you of and invite you to the People’s United special meeting.

At the People’s United special meeting, People’s United stockholders will be asked to vote on the following matters:

 

   

a proposal to adopt the merger agreement (the “People’s United merger proposal”).

 

   

a proposal to approve, on an advisory (non-binding) basis, the merger-related compensation payments that will or may be paid to the named executive officers of People’s United in connection with the transactions contemplated by the merger agreement (the “People’s United compensation proposal”).

 

   

a proposal to adjourn the People’s United special meeting, if necessary or appropriate, to solicit additional proxies if, immediately prior to such adjournment, there are not sufficient votes to approve the People’s United merger proposal or to ensure that any supplement or amendment to the accompanying joint proxy statement/prospectus is timely provided to People’s United stockholders (the “People’s United adjournment proposal”).

In light of the ongoing developments related to the COVID-19 pandemic and to support the health and well-being of our stockholders, employees and community, the People’s United special meeting will be held in a virtual-only format conducted via live webcast. You will be able to attend the special meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM (the “People’s United special meeting website”) and inserting the 16-digit control number included in your proxy card or, if you hold your shares of People’s United common stock in “street name,” in the voting instruction form provided by your bank, broker, trustee, nominee or other holder of record. You will be able to vote your shares electronically over the internet and submit questions online during the meeting by logging in to the website listed above and using the 16-digit control number. See the “Questions & Answers” section of the accompanying joint proxy statement/prospectus for more information, including technical support information for the virtual People’s United special meeting.

The board of directors of People’s United has fixed the close of business on [                ], 2021 as the record date for the People’s United special meeting. Only holders of record of People’s United common stock as of the close of business on the record date for the People’s United special meeting are entitled to notice of the People’s United special meeting or any adjournment or postponement thereof. Only holders of record of People’s United common stock will be entitled to vote at the People’s United special meeting or any adjournment or postponement thereof.


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People’s United has determined that holders of People’s United common stock and People’s United preferred stock are not entitled to appraisal rights with respect to the proposed merger under Section 262 of the Delaware General Corporation Law.

The People’s United board of directors unanimously recommends that People’s United stockholders vote “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal.

Your vote is important. We cannot complete the transactions contemplated by the merger agreement unless People’s United stockholders approve the People’s United merger proposal. The affirmative vote of a majority of the outstanding shares of People’s United common stock is required to approve the People’s United merger proposal.

Whether or not you plan to attend the People’s United special meeting, we urge you to please promptly complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope or authorize the individuals named on the accompanying proxy card to vote your shares by calling the toll-free telephone number or by using the internet as described in the instructions included with the accompanying proxy card. If your shares are held in the name of a bank, broker, trustee or other nominee, please follow the instructions on the voting instruction card furnished by such bank, broker, trustee or other nominee.

By Order of the Board of Directors

 

 

LOGO

John P. Barnes

Chairman of the Board and Chief Executive Officer

People’s United Financial, Inc.

[                ], 2021


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TABLE OF CONTENTS

 

     Page  

QUESTIONS AND ANSWERS

     1  

SUMMARY

     16  

Information About the Companies

     16  

The Merger and the Merger Agreement

     17  

Merger Consideration

     17  

Treatment of People’s United Preferred Stock

     18  

Treatment of People’s United Equity Awards

     18  

ESOP Matters

     19  

Material U.S. Federal Income Tax Consequences of the Merger

     20  

M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors

     20  

Opinion of M&T’s Financial Advisor

     20  

People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors

     21  

Opinions of People’s United’s Financial Advisors

     21  

Interests of Certain People’s United Directors and Executive Officers in the Merger

     22  

Governance of the Combined Company After the Merger

     24  

Regulatory Approvals

     24  

Expected Timing of the Merger

     25  

Conditions to Complete the Merger

     25  

Termination of the Merger Agreement

     26  

Termination Fee

     27  

Accounting Treatment

     27  

The Rights of People’s United Stockholders Will Change as a Result of the Merger

     27  

Listing of M&T Common Stock and New M&T Preferred Stock; Delisting and Deregistration of People’s United Common Stock and People’s United Preferred Stock

     27  

The M&T Special Meeting

     27  

The People’s United Special Meeting

     28  

Appraisal or Dissenters’ Rights in the Merger

     28  

Risk Factors

     28  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     29  

RISK FACTORS

     31  

Risks Relating to the Consummation of the Merger and M&T Following the Merger

     31  

Risks Relating to M&T’s Business

     38  

Risks Relating to People’s United’s Business

     38  

THE M&T SPECIAL MEETING

     39  

Date, Time and Place of the Meeting

     39  

Matters to Be Considered

     39  

Recommendation of M&T’s Board of Directors

     39  

Record Date and Quorum

     39  

Vote Required; Treatment of Abstentions and Failure to Vote

     40  

Attending the Virtual Special Meeting

     40  

Proxies

     41  

Shares Held in Street Name

     41  

Revocability of Proxies

     42  

Delivery of Proxy Materials

     42  

Solicitation of Proxies

     42  

Other Matters to Come Before the M&T Special Meeting

     42  

Assistance

     43  

 

i


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M&T PROPOSALS

     44  

Proposal 1: M&T Charter Amendment Proposal

     44  

Proposal 2: M&T Share Issuance Proposal

     44  

Proposal 3: M&T Adjournment Proposal

     44  

THE PEOPLE’S UNITED SPECIAL MEETING

     46  

Date, Time and Place of the Meeting

     46  

Matters to Be Considered

     46  

Recommendation of People’s United’s Board of Directors

     46  

Record Date and Quorum

     46  

Vote Required; Treatment of Abstentions and Failure to Vote

     47  

Attending the Virtual Special Meeting

     47  

Proxies

     48  

Shares Held in Street Name

     49  

Revocability of Proxies

     49  

Delivery of Proxy Materials

     50  

Solicitation of Proxies

     50  

Other Matters to Come Before the People’s United Special Meeting

     50  

Assistance

     50  

PEOPLE’S UNITED PROPOSALS

     51  

Proposal 1: People’s United Merger Proposal

     51  

Proposal 2: People’s United Compensation Proposal

     51  

Proposal 3: People’s United Adjournment Proposal

     52  

INFORMATION ABOUT THE COMPANIES

     53  

M&T Bank Corporation

     53  

People’s United

     53  

Merger Sub

     53  

THE MERGER

     55  

Terms of the Merger

     55  

Background of the Merger

     55  

M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors

     60  

Opinion of M&T’s Financial Advisor

     62  

People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors

     71  

Opinions of People’s United’s Financial Advisors

     74  

Certain Unaudited Prospective Financial Information

     95  

Interests of Certain People’s United Directors and Executive Officers in the Merger

     100  

Governance of the Combined Company After the Merger

     107  

Headquarters; Commitments to Communities

     108  

Accounting Treatment

     108  

Regulatory Approvals

     108  

Treatment of People’s United Preferred Stock

     112  

Stock Exchange Listings

     112  

Appraisal or Dissenters’ Rights in the Merger

     112  

THE MERGER AGREEMENT

     113  

Explanatory Note Regarding the Merger Agreement

     113  

Structure of the Merger

     113  

Merger Consideration

     114  

Fractional Shares

     114  

Governing Documents

     114  

Treatment of People’s United Equity Awards

     115  

Closing and Effective Time of the Merger

     116  

Exchange of Shares

     116  

 

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Representations and Warranties

     117  

Covenants and Agreements

     119  

Combined Company Governance

     128  

Meetings; Recommendation of M&T’s and People’s United’s Boards of Directors

     128  

Agreement Not to Solicit Other Offers

     129  

Conditions to Complete the Merger

     131  

Termination of the Merger Agreement

     131  

Effect of Termination

     132  

Termination Fee

     132  

Expenses and Fees

     133  

Amendment, Waiver and Extension of the Merger Agreement

     133  

Governing Law

     134  

Specific Performance

     134  

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

     135  

Tax Consequences of the Merger Generally

     136  

Cash Instead of a Fractional Share

     137  

Backup Withholding

     137  

UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS

     138  

DESCRIPTION OF M&T CAPITAL STOCK

     146  

General

     146  

Common Stock

     146  

Preferred Stock

     147  

DESCRIPTION OF NEW M&T PREFERRED STOCK

     151  

M&T Preferred Stock Generally

     151  

New M&T Preferred Stock

     151  

Ranking

     151  

Dividends

     152  

Redemption

     155  

Liquidation Rights

     157  

Voting Rights

     158  

Preemptive and Conversion Rights

     160  

Listing

     160  

Transfer Agent, Paying Agent and Registrar

     160  

Calculation Agent

     160  

COMPARISON OF THE RIGHTS OF M&T SHAREHOLDERS AND PEOPLE’S UNITED STOCKHOLDERS

     161  

LEGAL MATTERS

     175  

EXPERTS

     175  

DEADLINES FOR SUBMITTING SHAREHOLDER OR STOCKHOLDER PROPOSALS

     176  

WHERE YOU CAN FIND MORE INFORMATION

     179  

PART II INFORMATION NOT REQUIRED IN PROSPECTUS

     II-1  

Item 20. Indemnification of Directors and Officers

     II-1  

Item 21. Exhibits and Financial Statement Schedules

     II-2  

Item 22. Undertakings

     II-3  

Annex A—Agreement and Plan of Merger, dated as of February  21, 2021, by and among M&T Bank Corporation, Bridge Merger Corp. and People’s United Financial, Inc.

     A-1  

Annex B—Form of Certificate of Amendment to the Restated Certificate of Incorporation of M&T Bank Corporation—Authorized Capital Stock and Authorized Preferred Stock

     B-1  

Annex C—Form of Certificate of Amendment to the Restated Certificate of Incorporation of M&T Bank Corporation—New M&T Preferred Stock

     C-1  

Annex D—Opinion of Lazard Frères & Co. LLC

     D-1  

Annex E—Opinion of Keefe, Bruyette & Woods, Inc.

     E-1  

Annex F—Opinion of J.P. Morgan Securities LLC

     F-1  

 

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QUESTIONS AND ANSWERS

The following are some questions that you may have about the merger and the M&T special meeting or the People’s United special meeting, and brief answers to those questions. We urge you to read carefully the remainder of this joint proxy statement/prospectus because the information in this section does not provide all of the information that might be important to you with respect to the merger, the M&T special meeting or the People’s United special meeting. Additional important information is also contained in the documents incorporated by reference into this joint proxy statement/prospectus. See “Where You Can Find More Information” beginning on page 179.

In this joint proxy statement/prospectus, unless the context otherwise requires:

 

   

“M&T” refers to M&T Bank Corporation, a New York corporation;

 

   

“M&T Bank” refers to Manufacturers and Traders Trust Company, a New York state chartered bank and a wholly owned subsidiary of M&T;

 

   

“M&T bylaws” refers to the amended and restated bylaws of M&T Bank Corporation;

 

   

“M&T certificate of incorporation” refers to the restated certificate of incorporation of M&T Bank Corporation, as amended;

 

   

“M&T common stock” refers to the common stock of M&T, par value $0.50 per share;

 

   

“M&T preferred stock” refers to all of the following: the perpetual fixed-to-floating rate non-cumulative preferred stock, Series E, par value $1.00 per share, of M&T; the perpetual fixed-to-floating rate non-cumulative preferred stock, Series F, par value $1.00 per share, of M&T; and the perpetual 5.0% fixed-rate reset non-cumulative preferred stock, Series G, par value $1.00 per share, of M&T;

 

   

“Merger Sub” refers to Bridge Merger Corp., a Delaware corporation and a direct, wholly owned subsidiary of M&T;

 

   

“New M&T preferred stock” refers to the newly issued perpetual fixed-to-floating rate non-cumulative preferred stock, Series H, par value $1.00 per share, of M&T;

 

   

“People’s United” refers to People’s United Financial, Inc., a Delaware corporation;

 

   

“People’s United Bank” refers to People’s United Bank, National Association, a national banking association and a wholly owned subsidiary of People’s United;

 

   

“People’s United bylaws” refers to the amended eighth amended and restated bylaws of People’s United Financial, Inc.

 

   

“People’s United certificate of incorporation” refers to the third amended and restated certificate of incorporation of People’s United Financial, Inc.

 

   

“People’s United common stock” refers to the common stock of People’s United, par value $0.01 per share;

 

   

“People’s United preferred stock” refers to the fixed-to-floating rate non-cumulative perpetual preferred stock, Series A, par value $0.01 per share, of People’s United;

 

   

“shareholders” or “holders” refers to holders of shares of common stock of M&T both prior to and following the completion of the merger; and

 

   

“stockholders” or “holders” refers to holders of shares of the common stock of People’s United.

 

Q:

Why am I receiving this joint proxy statement/prospectus?

 

A:

You are receiving this joint proxy statement/prospectus because M&T, Merger Sub and People’s United entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”),

 

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  pursuant to which Merger Sub will merge with and into People’s United, with People’s United as the surviving entity (the “merger”), and as soon as reasonably practicable following the merger, People’s United will merge with and into M&T, with M&T as the surviving entity (the “holdco merger”). At a date and time following the holdco merger as determined by M&T, People’s United Bank will merge with and into M&T Bank, with M&T Bank as the surviving bank (the “bank merger”, and together with the merger and the holdco merger, the “mergers”). A copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus and is incorporated by reference herein. In this joint proxy statement/prospectus, we refer to the closing of the transactions contemplated by the merger agreement as the “closing,” the date on which the closing occurs as the “closing date” and the time at which the merger will occur as the “effective time.”

In order to complete the merger, among other things:

 

   

M&T shareholders must approve the proposed amendment of the M&T certificate of incorporation to effect an increase in the number of authorized shares of M&T capital stock from 251,000,000 to 270,000,000 and to increase the number of authorized shares of M&T’s preferred stock from 1,000,000 to 20,000,000 (the “M&T charter amendment proposal” and such amendment the “M&T charter amendment”);

 

   

M&T shareholders must approve the proposed issuance of M&T common stock to holders of People’s United common stock pursuant to the merger agreement in order to comply with applicable New York Stock Exchange (“NYSE”) listing rules (the “M&T share issuance proposal” and such issuance the “M&T share issuance”); and

 

   

People’s United stockholders must adopt the merger agreement (the “People’s United merger proposal”).

M&T is holding a virtual special meeting of M&T shareholders (the “M&T special meeting”) to obtain approval of the M&T charter amendment proposal and the M&T share issuance proposal. Holders of M&T preferred stock are not entitled to and are not requested to vote at the M&T special meeting.

M&T shareholders will also be asked to approve the proposal to adjourn the M&T special meeting to solicit additional proxies (i) if there are insufficient votes at the time of the M&T special meeting to approve the M&T charter amendment proposal and/or the M&T share issuance proposal or (ii) if adjournment is necessary or appropriate to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to M&T shareholders (the “M&T adjournment proposal”).

People’s United is holding a virtual special meeting of People’s United stockholders (the “People’s United special meeting”) to obtain approval of the People’s United merger proposal. Holders of People’s United preferred stock are not entitled to and are not requested to vote at the People’s United special meeting.

People’s United stockholders will also be asked to approve, on an advisory (non-binding) basis, the merger-related compensation payments that will or may be paid to the named executive officers of People’s United in connection with the transactions contemplated by the merger agreement (the “People’s United compensation proposal”), and to approve the proposal to adjourn the People’s United special meeting to solicit additional proxies (i) if there are insufficient votes at the time of the People’s United special meeting, to approve the People’s United merger proposal or (ii) if adjournment is necessary or appropriate, to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to holders of People’s United common stock (the “People’s United adjournment proposal”).

This document is also a prospectus that is being delivered to holders of People’s United common stock and holders of People’s United preferred stock because, pursuant to the merger agreement, M&T is offering shares of M&T common stock to People’s United stockholders and is also issuing shares of new M&T preferred stock to holders of People’s United preferred stock.

This joint proxy statement/prospectus contains important information about the merger and the other proposals being voted on at the M&T and People’s United special meetings. You should read it carefully and in its entirety. The enclosed materials allow you to have your shares of common stock voted by proxy

 

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without attending your meeting. Your vote is important and we encourage you to submit your proxy as soon as possible.

 

Q:

What will happen in the merger?

 

A:

In the merger, Merger Sub will merge with and into People’s United, with People’s United as the surviving entity. In the holdco merger, which will occur as soon as reasonably practicable following the merger, People’s United, as the surviving entity of the merger, will merge with and into M&T, with M&T as the surviving entity. In the bank merger, which will occur at a date and time following the holdco merger as determined by M&T, People’s United Bank will merge with and into M&T Bank, with M&T Bank as the surviving bank.

Each share of People’s United common stock issued and outstanding immediately prior to the effective time including each People’s United restricted share (as defined below) held by a non-employee director of the People’s United board of directors (each, a “People’s United director restricted share”) and except for certain shares owned by M&T or People’s United, will be converted into the right to receive 0.118 of a share (the “exchange ratio”) of M&T common stock (the “merger consideration”). After completion of the merger, (1) People’s United will no longer be a public company, (2) People’s United common stock and People’s United preferred stock will be delisted from the NASDAQ Global Select Market (“NASDAQ”) and will cease to be publicly traded, and (3) the People’s United common stock and People’s United preferred stock will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). After completion of the holdco merger, People’s United will cease to exist. Holders of M&T common stock and M&T preferred stock will continue to own their existing shares of M&T common stock and M&T preferred stock, respectively. See the information provided in the section entitled “The Merger Agreement—Structure of the Merger” beginning on page 113 and the merger agreement for more information about the merger.

 

Q:

When and where will each of the special meetings take place?

 

A:

The M&T special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time.

The People’s United special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern time.

Even if you plan to attend your respective company’s special meeting virtually, M&T and People’s United recommend that you vote your shares in advance as described below so that your vote will be counted if you later decide not to or become unable to attend the applicable special meeting.

 

Q:

What matters will be considered at each of the special meetings?

 

A:

At the M&T special meeting, M&T shareholders will be asked to consider and vote on the following proposals:

 

   

M&T Proposal 1: The M&T charter amendment proposal;

 

   

M&T Proposal 2: The M&T share issuance proposal; and

 

   

M&T Proposal 3: The M&T adjournment proposal.

At the People’s United special meeting, People’s United stockholders will be asked to consider and vote on the following proposals:

 

   

People’s United Proposal 1: The People’s United merger proposal;

 

   

People’s United Proposal 2: The People’s United compensation proposal; and

 

   

People’s United Proposal 3: The People’s United adjournment proposal.

 

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In order to complete the merger, among other things, M&T shareholders must approve the M&T charter amendment proposal and the M&T share issuance proposal, and People’s United stockholders must approve the People’s United merger proposal. None of the approvals of the M&T adjournment proposal, the People’s United compensation proposal or the People’s United adjournment proposal is a condition to the obligations of M&T or People’s United to complete the merger.

 

Q:

What will People’s United stockholders receive in the merger?

 

A:

In the merger, People’s United stockholders (including holders of People’s United director restricted shares) will receive 0.118 of a share of M&T common stock for each share of People’s United common stock held immediately prior to the completion of the merger. M&T will not issue any fractional shares of M&T common stock in the merger. People’s United stockholders (including holders of People’s United director restricted shares) who would otherwise be entitled to a fractional share of M&T common stock in the merger will instead receive an amount in cash (rounded to the nearest cent) determined by multiplying the average closing-sale price per share of M&T common stock on the NYSE for the consecutive period of five full trading days immediately preceding (but not including) the day on which the merger is completed (the “M&T closing share value”) by the fraction of a share (after taking into account all shares of People’s United common stock (including People’s United director restricted shares) held by such holder immediately prior to the completion of the merger and rounded to the nearest one-thousandth when expressed in decimal form) of M&T common stock that such shareholder would otherwise be entitled to receive.

 

Q:

What will holders of People’s United preferred stock receive in the merger?

 

A:

In the merger, each share of People’s United preferred stock, issued and outstanding immediately prior to the effective time will be converted into the right to receive a share of the new M&T preferred stock. For a description of the terms of the new M&T preferred stock, see the section entitled “Description of New M&T Preferred Stock” beginning on page 151.

 

Q:

What will M&T shareholders receive in the merger?

 

A:

In the merger, M&T shareholders will not receive any consideration, and their shares of M&T common stock will remain outstanding and will constitute shares of M&T following the merger. Following the merger, shares of M&T common stock will continue to be traded on the NYSE.

 

Q:

Will the value of the merger consideration change between the date of this joint proxy statement/prospectus and the time the merger is completed?

 

A:

Yes. Although the number of shares of M&T common stock that People’s United stockholders will receive is fixed, the value of the merger consideration will fluctuate between the date of this joint proxy statement/prospectus and the completion of the merger based upon the market value for M&T common stock. Any fluctuation in the market price of M&T common stock will change the value of the shares of M&T common stock that People’s United stockholders will receive. Neither M&T nor People’s United is permitted to terminate the merger agreement as a result of any increase or decrease in the market price of M&T common stock or People’s United common stock.

 

Q:

How will the merger affect People’s United equity awards?

 

A:

The merger agreement provides that, at the effective time, each outstanding restricted share award (a “People’s United restricted share”) under the People’s United stock plans (the “People’s United stock plans”), other than any People’s United director restricted shares, will, automatically and without any action on the part of the holder thereof, cease to represent a restricted share of People’s United common stock and

 

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  will be converted into a number of restricted shares of M&T common stock (each, an “M&T restricted share”) equal to the exchange ratio (rounded up or down to the nearest whole number, with 0.5 rounding up). Except as specifically provided in the merger agreement, at and following the effective time, each such M&T restricted share will continue to be governed by the same terms and conditions (including vesting terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United restricted share immediately prior to the effective time.

The merger agreement also provides that, at the effective time, each outstanding performance share unit (a “People’s United performance share”) under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the part of the holder thereof, cease to represent a performance share unit denominated in shares of People’s United common stock and will be converted into a restricted share unit denominated in shares of M&T common stock (an “M&T stock-based RSU”). The number of shares of M&T common stock subject to each such M&T stock-based RSU will be equal to the product (rounded up or down to the nearest whole number, with 0.5 rounding up) of (i) the number of shares of People’s United common stock subject to such People’s United performance share immediately prior to the effective time (including any applicable dividend equivalents) based on the higher of target performance and actual performance through the effective time as reasonably determined by the compensation committee of the People’s United board of directors in its reasonable judgment and in consultation with M&T, multiplied by (ii) the exchange ratio. Except as specifically provided in the merger agreement, at and following the effective time, each such M&T stock-based RSU will continue to be governed by the same terms and conditions (including employment vesting terms but excluding performance conditions, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United performance share immediately prior to the effective time.

The merger agreement further provides that, at the effective time, each outstanding option to purchase shares of People’s United common stock (a “People’s United option” and together with the People’s United restricted shares and People’s United performance shares, the “People’s United equity awards”) under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the part of the holder thereof, cease to represent an option to purchase shares of People’s United common stock and will be converted into an option to purchase a number of shares of M&T common stock (an “M&T option,” and together with the M&T restricted shares and M&T stock-based RSUs, the “M&T converted equity awards”) equal to the product (rounded down to the nearest whole number) of (i) the number of shares of People’s United common stock subject to such People’s United option immediately prior to the effective time and (ii) the exchange ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (a) the exercise price per share of People’s United common stock of such People’s United option immediately prior to the effective time divided by (b) the exchange ratio; provided, however, that the exercise price and the number of shares of M&T common stock purchasable pursuant to the People’s United options will be determined in a manner consistent with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”); provided, further, that in the case of any People’s United option to which Section 422 of the Code applies, the exercise price and the number of shares of People’s United common stock purchasable pursuant to such option will be determined in accordance with the foregoing, subject to such adjustments as are necessary in order to satisfy the requirements of Section 424(a) of the Code.

Except as specifically provided in the merger agreement or in the confidential disclosure schedules, following the effective time, each People’s United option will continue to be governed by the same terms and conditions (including vesting and exercisability terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to such People’s United option immediately prior to the effective time.

The merger agreement also provides that, in the event of a “Change in Control” (as defined in M&T’s 2019 Equity Incentive Compensation Plan (the “M&T equity plan”)) following the closing, any then-outstanding

 

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M&T converted equity award, to the extent not then vested, will be treated in accordance with Section 10.1 of the M&T equity plan.

 

Q:

How will the merger affect the People’s United 401(k) plan?

 

A.

It is expected that the People’s United Financial, Inc. 401(k) Employee Savings Plan (the “People’s United 401(k) plan”) will remain in effect through and after the closing date, and will be merged into a 401(k) plan sponsored by M&T or one of its subsidiaries (the “M&T 401(k) plan”) at a later date. However, the merger agreement provides that if requested by M&T in writing delivered to People’s United not less than 15 business days before the closing date, the board of directors of People’s United (or the appropriate committee thereof) will adopt resolutions and take such corporate action as is necessary or appropriate to terminate the People’s United 401(k) plan, effective as of the day prior to the closing date and contingent upon the occurrence of the effective time. If M&T requests that the People’s United 401(k) plan be terminated, (i) People’s United will provide M&T with evidence that such plan has been terminated (the form and substance of which will be subject to reasonable review and comment by M&T) not later than two days immediately preceding the closing date and (ii) the employees of People’s United and its subsidiaries who at the effective time become employees of M&T or its subsidiaries (the “continuing employees”) will be eligible to participate, effective as of the effective time, the M&T 401(k) plan. M&T and People’s United will take any and all actions as may be required, including amendments to the People’s United 401(k) plan and/or the M&T 401(k) plan, to permit the continuing employees to make rollover contributions to the M&T 401(k) plan of “eligible rollover distributions” (within the meaning of Section 401(a)(31) of the Code) from the People’s United 401(k) plan in the form of cash, notes (in the case of loans), M&T common stock or a combination thereof in an amount equal to the full account balance distributed to such employee from the People’s United 401(k) plan, and M&T will endeavor through reasonably commercial efforts to ensure availability of in-kind and note rollovers.

 

Q:

How will the merger affect People’s United’s employee stock ownership plan?

 

A:

The merger agreement provides that, prior to the closing date, People’s United will take any and all actions and adopt such necessary resolutions to terminate the Employee Stock Ownership Plan of People’s United Financial, Inc. (the “ESOP”) effective as of the date immediately preceding the closing date and adopt such amendments to the ESOP to terminate the ESOP and effectuate the provisions of the merger agreement. The ESOP amendments will provide that (i) all ESOP participant accounts will be fully vested, (ii) no new participants will be admitted to the ESOP on or after the ESOP termination date, and (iii) no additional benefits will accrue to any ESOP participant with respect to services performed on or after the closing date. The form and substance of all such resolutions and amendments will be subject to the review and approval of M&T, which will not be unreasonably withheld, and People’s United will deliver to M&T an executed copy of the resolutions and amendments as soon as practicable following their adoption by the People’s United board of directors and will fully comply with such resolutions and amendments.

In connection with the termination of the ESOP and the merger, People’s United will cause all outstanding indebtedness of the ESOP (including any loan made to the ESOP) to be satisfied in full at least five (5) business days prior to the closing date. People’s United will cancel or offset any loan made to the ESOP (including accrued interest thereon) in exchange for unallocated shares attributable to such loan having an aggregate fair market value that is not more than the outstanding amount of such loan plus accrued interest. This will result in the cancellation of both the loan receivable and payable on the books of People’s United. Any remaining shares of People’s United common stock held by the ESOP trust after repayment of any loan made to the ESOP will be converted into shares of M&T common stock in accordance with the terms of the merger agreement, and the balance of the unallocated shares and any other unallocated assets remaining in the ESOP’s suspense account after satisfaction of such loan and conversion of the shares of People’s United common stock into M&T common stock will be allocated as earnings to the accounts of the ESOP participants who are employed as of the date of termination of the ESOP based on

 

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their account balances under the ESOP as of such date. For the avoidance of doubt, the immediately preceding sentence will have no effect if there are no such unallocated shares or any other unallocated assets remaining in the ESOP’s suspense account. Prior to the closing date, People’s United will provide M&T documentary evidence sufficient to show that all outstanding indebtedness of People’s United’s ESOP (including any loan made to the ESOP) has been satisfied in full.

As soon as practicable after the closing date, M&T will file or cause to be filed all necessary documents with the Internal Revenue Service (the “IRS”) for a determination letter for termination of the ESOP. As soon as practicable following the receipt of a favorable determination letter from the IRS regarding the qualified status of the ESOP upon its termination, the account balances in the ESOP will either be distributed to participants and beneficiaries or transferred to an eligible tax qualified retirement plan or individual retirement account as a participant or beneficiary may direct. Prior to the distribution of account balances in the ESOP, M&T will take any and all actions as may be required, including amendments to the M&T 401(k) plan to permit each continuing employee to make rollover contributions of “eligible rollover distributions” (within the meaning of Section 401(a)(31) of the Code) at the time of such distribution from the ESOP in an amount equal to the full account balance distributed to such continuing employee from the ESOP to the M&T 401(k) plan.

 

Q:

How does the M&T board of directors recommend that I vote at the M&T special meeting?

 

A:

The M&T board of directors unanimously recommends that you vote “FOR” the M&T charter amendment proposal, “FOR” the M&T share issuance proposal and “FOR” the M&T adjournment proposal.

 

Q:

How does the People’s United board of directors recommend that I vote at the People’s United special meeting?

 

A:

The People’s United board of directors unanimously recommends that you vote “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal.

In considering the recommendations of the People’s United board of directors, People’s United stockholders should be aware that People’s United directors and executive officers may have interests in the merger that are different from, or in addition to, the interests of People’s United stockholders generally. For a more complete description of these interests, see the information provided in the section entitled “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger” beginning on page 100.

 

Q:

Who is entitled to vote at the M&T special meeting?

 

A:

The record date for the M&T special meeting is [                ], 2021. All M&T shareholders who held shares at the close of business on the record date for the M&T special meeting are entitled to receive notice of, and to vote at, the M&T special meeting.

Each holder of M&T common stock is entitled to cast one (1) vote on each matter properly brought before the M&T special meeting for each share of M&T common stock that such holder owned of record as of the record date. As of [                ], 2021, there were [                ] outstanding shares of M&T common stock.

Attendance at the special meeting is not required to vote. See below and the section entitled “The M&T Special Meeting—Proxies” beginning on page 41 for instructions on how to vote your shares without attending the M&T special meeting.

 

Q:

Who is entitled to vote at the People’s United special meeting?

 

A:

The record date for the People’s United special meeting is [                ], 2021. All People’s United stockholders who held shares at the close of business on the record date for the People’s United special meeting are entitled to receive notice of, and to vote at, the People’s United special meeting.

 

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Each holder of People’s United common stock is entitled to cast one (1) vote on each matter properly brought before the People’s United special meeting for each share of People’s United common stock that such holder owned of record as of the record date. As of [                ], 2021, there were [                ] outstanding shares of People’s United common stock.

Attendance at the special meeting is not required to vote. See below and the section entitled “The People’s United Special Meeting—Proxies” beginning on page 48 for instructions on how to vote your shares of People’s United common stock without attending the People’s United special meeting.

 

Q:

What constitutes a quorum for the M&T special meeting?

 

A:

The presence at the M&T special meeting, in attendance virtually or by proxy, of holders of a majority of the outstanding shares of M&T common stock entitled to vote at the M&T special meeting will constitute a quorum for the transaction of business at the M&T special meeting. Abstentions will be included in determining the number of shares present at the meeting for the purpose of determining the presence of a quorum.

 

Q:

What constitutes a quorum for the People’s United special meeting?

 

A:

The presence at the People’s United special meeting, in attendance virtually or by proxy, of the holders of a majority of the outstanding shares of People’s United common stock entitled to vote at the People’s United special meeting will constitute a quorum for the transaction of business at the People’s United special meeting. Abstentions will be included in determining the number of shares present at the meeting for the purpose of determining the presence of a quorum.

 

Q:

What vote is required for the approval of each proposal at the M&T special meeting?

 

A:

M&T Proposal 1: M&T charter amendment proposal. Approval of the M&T charter amendment proposal requires the affirmative vote of a majority of the outstanding shares of M&T common stock. Accordingly, an abstention or a broker non-vote or other failure to vote will have the same effect as a vote cast “AGAINST” the M&T charter amendment proposal.

M&T Proposal 2: M&T share issuance proposal. Approval of the M&T share issuance proposal requires the affirmative vote of a majority of votes cast by M&T shareholders at the M&T special meeting. Accordingly, an abstention or a broker non-vote or other failure to vote will have no effect on the outcome of the M&T share issuance proposal.

M&T Proposal 3: M&T adjournment proposal. Whether or not a quorum will be present at the meeting, approval of the M&T adjournment proposal requires the affirmative vote of a majority of the votes cast by M&T shareholders at the M&T special meeting. Accordingly, an abstention or a broker non-vote or other failure to vote will have no effect on the outcome of the M&T adjournment proposal.

 

Q:

What vote is required for the approval of each proposal at the People’s United special meeting?

 

A:

People’s United Proposal 1: People’s United merger proposal. Approval of the People’s United merger proposal requires the affirmative vote of a majority of the outstanding shares of People’s United common stock. Accordingly, an abstention or a broker non-vote or other failure to vote will have the same effect as a vote cast “AGAINST” the People’s United merger proposal.

People’s United Proposal 2: People’s United compensation proposal. Approval of the People’s United compensation proposal requires the affirmative vote of a majority of the votes cast by People’s United stockholders. Accordingly, an abstention or a broker non-vote or other failure to vote will have no effect on the outcome of the People’s United compensation proposal.

 

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People’s United Proposal 3: People’s United adjournment proposal. Whether or not a quorum will be present at the meeting, approval of the People’s United adjournment proposal requires the affirmative vote of a majority of the votes cast by People’s United stockholders. Accordingly, an abstention or a broker non-vote or other failure to vote will have no effect on the outcome of the People’s United adjournment proposal.

 

Q:

Why am I being asked to consider and vote on a proposal to approve, by non-binding, advisory vote, merger-related compensation arrangements for the People’s United named executive officers (i.e., the People’s United compensation proposal)?

 

A:

Under Securities and Exchange Commission (“SEC”) rules, People’s United is required to seek a non-binding, advisory vote with respect to the compensation that may be paid or become payable to People’s United’s named executive officers that is based on or otherwise relates to the merger or “golden parachute” compensation.

 

Q:

What happens if People’s United stockholders do not approve, by non-binding, advisory vote, merger-related compensation arrangements for People’s United’s named executive officers (i.e., the People’s United compensation proposal)?

 

A:

The vote on the proposal to approve the merger-related compensation arrangements for each of People’s United’s named executive officers is separate and apart from the votes to approve the other proposals being presented at the People’s United special meeting. Because the vote on the proposal to approve the merger-related executive compensation is advisory in nature only, it will not be binding upon People’s United or M&T before or following the merger. Accordingly, the merger-related compensation will be paid to People’s United’s named executive officers to the extent payable in accordance with the terms of their compensation agreements and other contractual arrangements even if People’s United stockholders do not approve the proposal to approve the merger-related executive compensation.

 

Q:

What if I hold shares in both M&T and People’s United?

 

A:

If you hold shares of both M&T common stock and People’s United common stock, you will receive separate packages of proxy materials. A vote cast as an M&T shareholder will not count as a vote cast as a People’s United stockholder, and a vote cast as a People’s United stockholder will not count as a vote cast as an M&T shareholder. Therefore, please submit separate proxies for your shares of M&T common stock and your shares of People’s United common stock.

 

Q:

How can I attend, vote and ask questions at the M&T special meeting or the People’s United special meeting?

 

A:

Record Holders. If you hold shares directly in your name as the holder of record of M&T or People’s United common stock you are a “record holder” and your shares may be voted at the M&T special meeting or the People’s United special meeting by you, as applicable. If you choose to vote your shares virtually at the respective special meeting via the applicable special meeting website, you will need the control number, as described below.

Beneficial Owners. If you hold shares in a brokerage or other account in “street name” you are a “beneficial owner” and your shares may be voted at the M&T special meeting or the People’s United special meeting, as applicable by you as described below. If you choose to vote your shares virtually at the respective special meeting via the applicable special meeting website, you will need the control number, as described below

M&T special meeting. If you are a record holder you will be able to attend the M&T special meeting online, ask questions and vote during the meeting by visiting [                ] and following the instructions. The password for the meeting, if requested, is [                ]. Please have your control number, which can be found

 

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on your proxy card, notice or email previously received, to access the meeting. If you are a beneficial owner, you also will be able to attend the M&T special meeting online, ask questions and vote during the meeting by visiting [                ] and following the instructions. The password for the meeting, if requested, is [                ]. Please have your control number, which can be found on your proxy card, notice or email previously received, to access the meeting. Please review this information prior to the M&T special meeting to ensure you have access.

M&T encourages its shareholders to visit the meeting website above in advance of the M&T special meeting to familiarize themselves with the online access process. The virtual M&T special meeting platform is fully supported across browsers and devices that are equipped with the most updated version of applicable software and plugins. Shareholders should verify their internet connection prior to the M&T special meeting. Shareholders encountering difficulty with the M&T special meeting virtual platform during the sign-in process or at any time during the meeting may utilize technical support provided by M&T through Computershare. Technical support information is provided on the sign-in page for all shareholders. If you have difficulty accessing the virtual M&T special meeting during check-in or during the meeting, please contact technical support as indicated on the M&T special meeting sign-in page. Shareholders will have substantially the same opportunities to participate in the virtual M&T special meeting as they would have at a physical, in-person meeting. Shareholders as of the record date will be able to attend, vote, examine the shareholder list, and submit questions during a portion of the meeting via the online platform.

People’s United special meeting. If you are a record holder you will be able to attend the People’s United special meeting online, ask questions and vote during the meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM and following the instructions. Please have your 16-digit control number, which can be found on your proxy card, notice or email previously received, to access the meeting. If you are a beneficial owner, you also will be able to attend the People’s United special meeting online, ask questions and vote during the meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM and following the instructions. Please have your 16-digit control number, which can be found on the voting instructions provided by your bank, broker, trustee or other nominee, to access the meeting. Please review this information prior to the People’s United special meeting to ensure you have access.

People’s United encourages its stockholders to visit the meeting website above in advance of the People’s United special meeting to familiarize themselves with the online access process. The virtual People’s United special meeting platform is fully supported across browsers and devices that are equipped with the most updated version of applicable software and plugins. Stockholders should verify their internet connection prior to the People’s United special meeting. If you have difficulty accessing the virtual People’s United special meeting during check-in or during the meeting, please contact technical support as indicated on the People’s United special meeting sign-in page. Stockholders will have substantially the same opportunities to participate in the virtual People’s United special meeting as they would have at a physical, in-person meeting. Stockholders as of the record date will be able to attend, vote, examine the stockholder list, and submit questions during a portion of the meeting via the online platform.

Even if you plan to attend the M&T special meeting or the People’s United special meeting virtually, as applicable, M&T and People’s United recommend that you vote your shares in advance as described below so that your vote will be counted if you later decide not to or become unable to attend the respective special meeting.

Additional information on attending the virtual special meetings can be found under the section entitled “The M&T Special Meeting—Attending the Virtual Special Meeting” on page 40 and under the section entitled “The People’s United Special Meeting—Attending the Virtual Special Meeting” on page 47.

 

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Q:

How can I vote my shares without attending my respective special meeting?

 

A:

Whether you hold your shares directly as the holder of record of M&T or People’s United or beneficially in “street name,” you may direct your vote by proxy without attending the M&T special meeting or the People’s United special meeting, as applicable.

If you are a record holder of M&T common stock or People’s United common stock, you can vote your shares by proxy over the internet, by telephone or by mail by following the instructions provided in the enclosed proxy card. If you hold shares beneficially in “street name” as a beneficial owner of M&T common stock or People’s United common stock, you should follow the voting instructions provided by your bank, broker, trustee or other nominee.

Additional information on voting procedures can be found under the section entitled “The M&T Special Meeting—Attending the Virtual Special Meeting” on page 40 and under the section entitled “The People’s United Special Meeting—Attending the Virtual Special Meeting” on page 47.

 

Q:

What do I need to do now?

 

A:

After carefully reading and considering the information contained in this document, please vote as soon as possible. If you hold shares of M&T common stock or People’s United common stock, please respond by completing, signing and dating the accompanying proxy card and returning it in the enclosed postage-paid envelope, or by submitting your proxy by telephone or through the internet, as soon as possible so that your shares may be represented at your meeting. Please note that if you are a beneficial owner with shares held in “street name,” you should follow the voting instructions provided by your bank, broker, trustee or other nominee.

 

Q:

If I am a beneficial owner with my shares held in “street name” by a bank, broker, trustee or other nominee, will my bank, broker, trustee or other nominee vote my shares for me?

 

A:

No. Your bank, broker, trustee or other nominee cannot vote your shares without instructions from you. You should instruct your bank, broker, trustee or other nominee how to vote your shares in accordance with the instructions provided to you. Please check the voting instruction form used by your bank, broker, trustee or other nominee.

 

Q:

What is a “broker non-vote”?

 

A:

A “broker non-vote” occurs on an item when a nominee or intermediary is not permitted to vote on that item without instructions from the beneficial owner of the shares, and the beneficial owner fails to provide the nominee or intermediary with such instructions.

 

Q:

Why is my vote important?

 

A:

If you do not vote, it will be more difficult for M&T or People’s United to obtain the necessary quorum to hold its special meeting. Your failure to submit a proxy or vote virtually at your respective special meeting, or failure to instruct your bank or broker how to vote, or abstention will have the same effect as a vote “AGAINST” the M&T charter amendment proposal and a vote “AGAINST” the People’s United merger proposal, as applicable.

The M&T board of directors and the People’s United board of directors unanimously recommend that you vote “FOR” the M&T charter amendment proposal and “FOR” the People’s United merger proposal, respectively, and “FOR” the other proposals to be considered at the M&T special meeting and the People’s United special meeting, respectively.

 

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Q:

What if I hold shares of People’s United common stock in my plan account under the People’s United 401(k) plan or the ESOP?

 

A:

If you hold shares of People’s United common stock in your plan account under the People’s United 401(k) Plan or the ESOP, you will receive voting instruction forms that reflect all shares of People’s United common stock for which you may direct the voting under the terms of the applicable plan.

Under the terms of the People’s United 401(k) plan, the People’s United 401(k) plan trustee votes the shares of People’s United common stock held by the plan only in accordance with instructions provided to the trustee on how to vote the shares by a participant with respect to the shares of People’s United common stock held in such participant’s plan account. The People’s United 401(k) plan trustee will vote your shares of People’s United common stock in accordance with your instructions. In the event such written instructions direct the voting of fractional shares, the People’s United 401(k) plan trustee will cumulate fractional share votes and vote all resulting whole share votes. Any remaining partial share votes will be disregarded. Any shares of People’s United common stock held by the People’s United 401(k) plan for which the trustee has not received written instructions will not be voted. The deadline for returning your voting instructions for shares held in your account in the People’s United 401(k) plan is three days prior to the People’s United special meeting date.

Under the terms of the ESOP, the ESOP trustee votes all shares of People’s United common stock held by the ESOP, but each participant may provide instructions to the trustee on how to vote the shares of People’s United common stock held in such participant’s plan account. The ESOP trustee will vote your shares of People’s United common stock in accordance with your instructions and, subject to the exercise of its fiduciary responsibilities, will vote all unallocated shares of People’s United common stock held by the ESOP and allocated shares of People’s United common stock for which no voting instructions were received in the same proportion as the instructions received from other participants in the ESOP. The deadline for returning your voting instructions for shares held in your account in the ESOP is ten (10) days prior to the People’s United special meeting date.

 

Q:

What will happen if I return my proxy card without indicating how to vote?

 

A:

If you sign and return your proxy card without indicating how to vote on any particular proposal, the shares of M&T common stock represented by your proxy will be voted as recommended by the M&T board of directors with respect to such proposal or proposals, as the case may be or the shares of People’s United common stock represented by your proxy will be voted as recommended by the People’s United board of directors with respect to such proposal or proposals as the case may be.

 

Q:

Can I change my vote after I have delivered my proxy or voting instruction card?

 

A:

If you directly hold shares of M&T common stock or People’s United common stock in your name as a record holder, you can change your vote at any time before your proxy is voted at your meeting. You can do this by:

 

   

submitting a written statement that you would like to revoke your proxy to the corporate secretary of M&T or People’s United, as applicable;

 

   

signing and returning a proxy card with a later date;

 

   

attending the special meeting virtually and voting by ballot at the special meeting; or

 

   

voting by telephone or the internet at a later time.

If you are a beneficial owner and your shares are held by a bank, broker, trustee or other nominee, you may change your vote by:

 

   

contacting your bank, broker, trustee or other nominee; or

 

   

attending the special meeting virtually and voting your shares via the special meeting website if you have your control number, which can be found on the voting instructions provided by your bank, broker, trustee or other nominee. Please contact your bank, broker, trustee or other nominee for further instructions.

 

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Q:

Will M&T be required to submit the M&T charter amendment proposal and the M&T share issuance proposal to its shareholders even if the M&T board of directors has withdrawn, modified or qualified its recommendation?

 

A:

Yes. Unless the merger agreement is terminated before the M&T special meeting, M&T is required to submit the M&T charter amendment proposal and the M&T share issuance proposal to its shareholders even if the M&T board of directors has withdrawn, modified or qualified its recommendation.

 

Q:

Will People’s United be required to submit the People’s United merger proposal to its stockholders even if the People’s United board of directors has withdrawn, modified or qualified its recommendation?

 

A:

Yes. Unless the merger agreement is terminated before the People’s United special meeting, People’s United is required to submit the People’s United merger proposal to its stockholders even if the People’s United board of directors has withdrawn, modified or qualified its recommendation.

 

Q:

Are holders of M&T common stock or M&T preferred stock entitled to dissenters’ rights?

 

A:

No. Neither holders of M&T common stock nor holders of M&T preferred stock are entitled to dissenters’ rights under the New York Business Corporation Law (the “NYBCL”). For more information, see the section entitled “Comparison of the Rights of M&T Shareholders and People’s United Stockholders—Appraisal or Dissenters’ Rights” beginning on page 171.

 

Q:

Are holders of People’s United common stock or People’s United preferred stock entitled to appraisal rights?

 

A:

No. Neither holders of People’s United common stock nor holders of People’s United preferred stock are entitled to appraisal rights under the Delaware General Corporation Law (the “DGCL”). For more information, see the section entitled “Comparison of the Rights of M&T Shareholders and People’s United Stockholders—Appraisal or Dissenters’ Rights” beginning on page 171.

 

Q:

Are there any risks that I should consider in deciding whether to vote for the approval of the M&T charter amendment proposal, the approval of the M&T share issuance proposal, the approval of the People’s United merger proposal, or the other proposals to be considered at the M&T special meeting and the People’s United special meeting, respectively?

 

A:

Yes. You should read and carefully consider the risk factors set forth in the section entitled “Risk Factors” beginning on page 31. You also should read and carefully consider the risk factors of M&T and People’s United contained in the documents that are incorporated by reference into this joint proxy statement/prospectus.

 

Q:

What are the material U.S. federal income tax consequences of the merger and the holdco merger to holders of People’s United common stock and People’s United preferred stock?

 

A:

The merger and the holdco merger have been structured to qualify as a reorganization for federal income tax purposes, and it is a condition to our respective obligations to complete the mergers that each of M&T and People’s United receives a legal opinion to the effect that the merger and the holdco merger, taken together, will so qualify. Accordingly, holders of People’s United common stock and People’s United preferred stock generally will not recognize any gain or loss for U.S. federal income tax purposes on the exchange of their People’s United common stock for M&T common stock and People’s United preferred stock for new M&T preferred stock, as applicable, in the merger, except for any gain or loss that may result from the receipt of cash instead of a fractional share of M&T common stock. You should be aware that the tax consequences to

 

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  you of the mergers may depend upon your own situation. In addition, you may be subject to state, local or foreign tax laws that are not discussed in this joint proxy statement/prospectus. You should therefore consult with your own tax advisor for a full understanding of the tax consequences to you of the mergers. For a more complete discussion of the material U.S. federal income tax consequences of the mergers, see the section entitled “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 135.

 

Q:

When is the merger expected to be completed?

 

A:

Neither M&T nor People’s United can predict the actual date on which the merger will be completed, or if the merger will be completed at all, because completion of the merger is subject to conditions and factors outside the control of both companies. People’s United must first obtain the approval of People’s United stockholders for the People’s United merger proposal, and M&T must first obtain approval of M&T shareholders for the M&T charter amendment proposal and the M&T share issuance proposal. M&T and People’s United must also obtain necessary regulatory approvals and satisfy certain other closing conditions. M&T and People’s United expect the merger to be completed promptly once M&T and People’s United have obtained their respective shareholders’ and stockholders’ approvals noted above, have obtained necessary regulatory approvals, and have satisfied certain other closing conditions.

 

Q:

What are the conditions to complete the merger?

 

A:

The obligations of M&T and People’s United to complete the merger are subject to the satisfaction or waiver of certain closing conditions contained in the merger agreement, including the receipt of required regulatory approvals and the expiration of all statutory waiting periods without the imposition of any materially burdensome regulatory condition, the receipt of certain tax opinions, approval by M&T shareholders of the M&T charter amendment proposal and the M&T share issuance proposal and approval by People’s United stockholders of the People’s United merger proposal. For more information, see “The Merger Agreement—Conditions to Complete the Merger” beginning on page 131.

 

Q:

What happens if the merger is not completed?

 

A:

If the merger is not completed, neither holders of People’s United common stock nor holders of People’s United preferred stock will receive any consideration for their shares of People’s United common stock or People’s United preferred stock, respectively, in connection with the merger. Instead, People’s United will remain an independent public company, People’s United common stock and preferred stock will continue to be listed and traded on NASDAQ, and M&T will not complete the issuance of shares of M&T common stock or new M&T preferred stock pursuant to the merger agreement. In addition, if the merger agreement is terminated in certain circumstances, a termination fee of $280 million will be payable by either M&T or People’s United, as applicable. See “The Merger Agreement—Termination Fee” beginning on page 132 for a more detailed discussion of the circumstances under which a termination fee will be required to be paid.

 

Q:

What happens if I sell my shares after the applicable record date but before my company’s special meeting?

 

A:

Each of the M&T and People’s United record date is earlier than the date of the M&T special meeting and the People’s United special meeting, as applicable, and earlier than the date that the merger is expected to be completed. If you sell or otherwise transfer your shares of M&T common stock or People’s United common stock, as applicable, after the applicable record date but before the date of the applicable special meeting, you will retain your right to vote at such special meeting (provided that such shares remain outstanding on the date of such special meeting), but, with respect to People’s United common stock, you will not have the right to receive the merger consideration to be received by People’s United stockholders in connection with the merger. In order to receive the merger consideration, you must hold your shares of People’s United common stock through the completion of the merger.

 

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Q:

Should I send in my stock certificates now?

 

A:

No. Please do not send in your stock certificates with your proxy. After the merger is completed, an exchange agent designated by M&T and reasonably acceptable to People’s United (the “exchange agent”) will send you instructions for exchanging People’s United stock certificates for the consideration to be received in the merger. See “The Merger Agreement—Exchange of Shares” beginning on page 116.

 

Q:

What should I do if I receive more than one set of voting materials for the same special meeting?

 

A:

If you are a beneficial owner and hold shares of M&T common stock or People’s United common stock in “street name” and also are a record holder and hold shares directly in your name or otherwise or if you hold shares of M&T common stock or People’s United common stock in more than one (1) brokerage account, you may receive more than one (1) set of voting materials relating to the same special meeting.

Record Holders. For shares held directly, please complete, sign, date and return each proxy card (or cast your vote by telephone or internet as provided on each proxy card) or otherwise follow the voting instructions provided in this joint proxy statement/prospectus in order to ensure that all of your shares of M&T common stock or People’s United common stock are voted.

Beneficial Owners. For shares held in “street name” through a bank, broker, trustee or other nominee, you should follow the procedures provided by your bank, broker, trustee or other nominee in order to vote your shares.

 

Q:

Who can help answer my questions?

 

A:

M&T shareholders: If you have any questions about the merger or how to submit your proxy or voting instruction card, or if you need additional copies of this document or the enclosed proxy card or voting instruction card, you should contact M&T’s proxy solicitor, Georgeson, by calling toll-free at 1-866-856-4733.

People’s United stockholders: If you have any questions about the merger or how to submit your proxy or voting instruction card, or if you need additional copies of this document or the enclosed proxy card or voting instruction card, you should contact People’s United’s proxy solicitor, D.F. King & Co., Inc., by calling toll-free at (800) 207-3159.

 

Q:

Where can I find more information about M&T and People’s United?

 

A:

You can find more information about M&T and People’s United from the various sources described under “Where You Can Find More Information” beginning on page 179.

 

Q:

What is householding and how does it affect me?

 

A:

The SEC permits companies to send a single set of proxy materials to any household at which two or more shareholders reside, unless contrary instructions have been received, but only if the applicable shareholders provide advance notice and follow certain procedures. In such cases, each shareholder continues to receive a separate notice of the meeting and proxy card. Certain brokerage firms may have instituted householding for beneficial owners of M&T common stock and People’s United common stock, as applicable, held through brokerage firms. If your family has multiple accounts holding M&T common stock or People’s United common stock, as applicable, you may have already received a householding notification from your broker. Please contact your broker directly if you have any questions or require additional copies of this joint proxy statement/prospectus. The broker will arrange for delivery of a separate copy of this joint proxy statement/prospectus promptly upon your written or oral request. You may decide at any time to revoke your decision to household, and thereby receive multiple copies.

 

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SUMMARY

This summary highlights selected information in this joint proxy statement/prospectus and may not contain all of the information that is important to you. You should carefully read this entire joint proxy statement/prospectus and the other documents we refer you to for a more complete understanding of the matters being considered at the special meetings. In addition, we incorporate by reference important business and financial information about M&T and People’s United into this joint proxy statement/prospectus. You may obtain the information incorporated by reference into this joint proxy statement/prospectus without charge by following the instructions in the section entitled “Where You Can Find More Information” beginning on page 179 of this joint proxy statement/prospectus.

Information About the Companies (page 53)

M&T Bank Corporation

M&T is a New York business corporation registered as a financial holding company under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and as a bank holding company under Article III-A of the New York Banking Law. M&T was incorporated in November 1969. As of December 31, 2020, M&T had consolidated total assets of $142.6 billion, deposits of $119.8 billion and shareholders’ equity of $16.2 billion. M&T had 16,718 full-time and 655 part-time employees as of December 31, 2020.

At December 31, 2020, M&T had two wholly owned bank subsidiaries: M&T Bank and Wilmington Trust, National Association. The banks collectively offer a wide range of retail and commercial banking, trust and wealth management, and investment services to their customers. At December 31, 2020, M&T Bank represented ninety-nine percent (99%) of consolidated assets of M&T, and had 716 domestic banking offices located in New York, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Virginia, West Virginia and the District of Columbia, a full-service commercial banking office in Ontario, Canada, and an office in George Town, Cayman Islands. As a commercial bank, M&T Bank offers a broad range of financial services to a diverse base of consumers, businesses, professional clients, governmental entities and financial institutions located in its markets.

M&T’s common stock is traded on the NYSE under the symbol “MTB.” The principal executive offices of M&T are located at One M&T Plaza, Buffalo, New York 14203, and its telephone number is (716) 635-4000.

People’s United

People’s United is a bank holding company and a financial holding company registered under the BHC Act, and is incorporated under the state laws of Delaware. People’s United is the holding company for People’s United Bank, National Association (“People’s United Bank”), a national banking association headquartered in Bridgeport, Connecticut. As of December 31, 2020, People’s United had consolidated total assets of $63.1 billion, deposits of $52.1 billion and stockholders’ equity of $7.6 billion. People’s United had 5,640 full-time, 287 part-time and 60 temporary employees as of December 31, 2020.

The principal business of People’s United is to provide, through People’s United Bank and its subsidiaries, commercial banking, retail banking and wealth management services to individual, corporate and municipal customers. Traditional banking activities are conducted primarily within New England and southeastern New York, and include extending secured and unsecured commercial and consumer loans, originating mortgage loans secured by residential and commercial properties, and accepting consumer, commercial and municipal deposits.

In addition to traditional banking activities, People’s United Bank provides specialized financial services tailored to specific markets including: personal, institutional and employee benefit trust; cash management; and



 

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municipal banking. Through its non-banking subsidiaries, People’s United Bank offers: equipment financing through People’s Capital and Leasing Corp., People’s United Equipment Finance Corp. and LEAF Commercial Capital, Inc.; brokerage, financial advisory services, investment management services and life insurance through People’s Securities, Inc.; and investment advisory services and financial management and planning services through People’s United Advisors, Inc.

People’s United’s common stock is traded on the NASDAQ Global Select Market under the symbol “PBCT.” The principal executive offices of People’s United are located at 850 Main Street, Bridgeport, Connecticut 06604, and its telephone number is (203) 338-7171.

Merger Sub

Merger Sub, a direct, wholly owned subsidiary of M&T, is a Delaware corporation that was incorporated for the sole purpose of effecting the merger. In the merger, Merger Sub will merge with and into People’s United, with People’s United surviving as a direct, wholly owned subsidiary of M&T and the separate corporate existence of Merger Sub will cease.

Its principal executive office is located at c/o M&T Bank Corporation, One M&T Plaza, Buffalo, New York 14203, and its telephone number is (716) 635-4000.

The Merger and the Merger Agreement (pages 55 and 113)

The terms and conditions of the merger are contained in the merger agreement, a copy of which is attached as Annex A to this joint proxy statement/prospectus. You are encouraged to read the merger agreement carefully and in its entirety, as it is the primary legal document that governs the merger.

Pursuant to the terms and subject to the conditions set forth in the merger agreement, at the effective time of the merger, Merger Sub will merge with and into People’s United, with People’s United as the surviving entity. As soon as reasonably practicable following the merger, the holdco merger will occur in which People’s United will merge with and into M&T, with M&T as the surviving entity. The merger agreement further provides that at a date and time following the holdco merger as determined by M&T, the bank merger will occur in which People’s United Bank will merge with and into M&T Bank, with M&T Bank as the surviving bank. Following the merger, People’s United common stock and People’s United preferred stock will be delisted from NASDAQ, deregistered under the Exchange Act and will cease to be publicly traded.

Merger Consideration (page 114)

Each share of People’s United common stock issued and outstanding immediately prior to the effective time, including each People’s United director restricted share and except for certain shares owned by M&T or People’s United, will be converted into the right to receive 0.118 of a share of M&T common stock. People’s United stockholders who would otherwise be entitled to a fraction of a share of M&T common stock in the merger will instead receive, for the fraction of a share, an amount in cash (rounded to the nearest cent) based on the M&T closing share value.

M&T common stock is listed on the NYSE under the symbol “MTB,” and People’s United common stock is listed on NASDAQ under the symbol “PCBT.” The following table shows the closing sale prices of M&T common stock and People’s United common stock as reported on the NYSE and NASDAQ, as applicable, on February 19, 2021, the last trading day before the public announcement of the merger agreement, and on [                ], 2021, the last practicable trading day before the date of this joint proxy statement/prospectus. This table also shows the implied value of the merger consideration to be issued in exchange for each share of



 

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People’s United common stock, which was calculated by multiplying the closing price of People’s United common stock on those dates by the exchange ratio of 0.118.

 

     M&T
Common
Stock
     People’s United
Common
Stock
     Implied Value
of One Share
of People’s United
Common Stock
 

February 19, 2021

   $ 149.97      $ 15.68      $ 17.70  

[                ], 2021

   $ [            $ [            $ [        

For more information on the exchange ratio, see the section entitled “The Merger—Terms of the Merger” beginning on page 55 and “The Merger Agreement—Merger Consideration” beginning on page 114.

Treatment of People’s United Preferred Stock (page 112)

In the merger, each share of People’s United preferred stock issued and outstanding immediately prior to the effective time will be converted into the right to receive one (1) share of new M&T preferred stock. For a description of the terms of the new M&T preferred stock, see the section entitled “Description of New M&T Preferred Stock” beginning on page 150.

Treatment of People’s United Equity Awards (page 115)

The merger agreement provides that, at the effective time, each outstanding People’s United restricted share under the People’s United stock plans, other than any People’s United director restricted shares, will, automatically and without any action on the part of the holder thereof, cease to represent a restricted share of People’s United common stock and will be converted into a number of M&T restricted shares equal to the exchange ratio (rounded up or down to the nearest whole number, with 0.5 rounding up). Except as specifically provided in the merger agreement, at and following the effective time, each such M&T restricted share will continue to be governed by the same terms and conditions (including vesting terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United restricted share immediately prior to the effective time.

The merger agreement also provides that, at the effective time, each outstanding People’s United performance share under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the part of the holder thereof, cease to represent a performance share unit denominated in shares of People’s United common stock and will be converted into an M&T stock-based RSU. The number of shares of M&T common stock subject to each such M&T stock-based RSU will be equal to the product (rounded up or down to the nearest whole number, with 0.5 rounding up) of (i) the number of shares of People’s United common stock subject to such People’s United performance share immediately prior to the effective time (including any applicable dividend equivalents) based on the higher of target performance and actual performance through the effective time as reasonably determined by the compensation committee of the People’s United board of directors in its reasonable judgment and in consultation with M&T, multiplied by (ii) the exchange ratio. Except as specifically provided in the merger agreement, at and following the effective time, each such M&T stock-based RSU will continue to be governed by the same terms and conditions (including employment vesting terms but excluding performance conditions, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United performance share immediately prior to the effective time.

The merger agreement further provides that, at the effective time, each outstanding People’s United option under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the



 

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part of the holder thereof, cease to represent an option to purchase shares of People’s United common stock and will be converted into an M&T option equal to the product (rounded down to the nearest whole number) of (i) the number of shares of People’s United common stock subject to such People’s United option immediately prior to the effective time and (ii) the exchange ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (a) the exercise price per share of People’s United common stock of such People’s United option immediately prior to the effective time divided by (b) the exchange ratio; provided, however, that the exercise price and the number of shares of M&T common stock purchasable pursuant to the People’s United options will be determined in a manner consistent with the requirements of Section 409A of the Code; provided, further, that in the case of any People’s United option to which Section 422 of the Code applies, the exercise price and the number of shares of People’s United common stock purchasable pursuant to such option will be determined in accordance with the foregoing, subject to such adjustments as are necessary in order to satisfy the requirements of Section 424(a) of the Code. Except as specifically provided in the merger agreement or in the confidential disclosure schedules, following the effective time, each People’s United option will continue to be governed by the same terms and conditions (including vesting and exercisability terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to such People’s United option immediately prior to the effective time.

The merger agreement also provides that, in the event of a “Change in Control” (as defined in the M&T equity plan) following the closing, any then-outstanding M&T converted equity award, to the extent not then vested, will be treated in accordance with Section 10.1 of the M&T equity plan.

For more information see “The Merger Agreement—Treatment of People’s United Equity Awards” beginning on page 115.

ESOP Matters (page 126)

The merger agreement provides that, prior to the closing date, People’s United will take any and all actions and adopt such necessary resolutions to terminate the ESOP effective as of the date immediately preceding the closing date and adopt such amendments to the ESOP to terminate the ESOP and effectuate the provisions of the merger agreement. The ESOP amendments will provide that (i) all ESOP participant accounts will be fully vested, (ii) no new participants will be admitted to the ESOP on or after the ESOP termination date, and (iii) no additional benefits will accrue to any ESOP participant with respect to services performed on or after the closing date. The form and substance of all such resolutions and amendments will be subject to the review and approval of M&T, which will not be unreasonably withheld, and People’s United will deliver to M&T an executed copy of the resolutions and amendments as soon as practicable following their adoption by the People’s United board of directors and will fully comply with such resolutions and amendments.

In connection with the termination of the ESOP and the merger, People’s United will cause all outstanding indebtedness of the ESOP (including any loan made to the ESOP) to be satisfied in full at least five business days prior to the closing date. People’s United will cancel or offset any loan made to the ESOP (including accrued interest thereon) in exchange for unallocated shares attributable to such loan having an aggregate fair market value that is not more than the outstanding amount of such loan plus accrued interest. This will result in the cancellation of both the loan receivable and payable on the books of People’s United. Any remaining shares of People’s United common stock held by the ESOP trust after repayment of any loan made to the ESOP will be converted into shares of M&T common stock in accordance with the terms of the merger agreement, and the balance of the unallocated shares and any other unallocated assets remaining in the ESOP’s suspense account after satisfaction of such loan and conversion of the shares of People’s United common stock into M&T common stock will be allocated as earnings to the accounts of the ESOP participants who are employed as of the date of termination of the ESOP based on their account balances under the ESOP as of such date. For the avoidance of doubt, the immediately preceding sentence will have no effect if there are no such unallocated shares or any other unallocated assets remaining in the ESOP’s suspense account. Prior to the closing date, People’s United will



 

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provide M&T documentary evidence sufficient to show that all outstanding indebtedness of People’s United’s ESOP (including any loan made to the ESOP) has been satisfied in full.

As soon as practicable after the closing date, M&T will file or cause to be filed all necessary documents with the IRS for a determination letter for termination of the ESOP. As soon as practicable following the receipt of a favorable determination letter from the IRS regarding the qualified status of the ESOP upon its termination, the account balances in the ESOP will either be distributed to participants and beneficiaries or transferred to an eligible tax qualified retirement plan or individual retirement account as a participant or beneficiary may direct. Prior to the distribution of account balances in the ESOP, M&T will take any and all actions as may be required, including amendments to the M&T 401(k) plan to permit each continuing employee to make rollover contributions of “eligible rollover distributions” (within the meaning of Section 401(a)(31) of the Code) at the time of such distribution from the ESOP in an amount equal to the full account balance distributed to such continuing employee from the ESOP to the M&T 401(k) plan.

For more information see “The Merger Agreement—ESOP Matters” beginning on page 126.

Material U.S. Federal Income Tax Consequences of the Merger (page 135)

The merger and the holdco merger, taken together, are intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code and it is a condition to the respective obligations of M&T and People’s United to complete the merger that each of M&T and People’s United receives a legal opinion to that effect. Accordingly, assuming the receipt and accuracy of these opinions, a holder who receives solely shares of M&T common stock (or receives M&T common stock and cash solely in lieu of a fractional share) or new M&T preferred stock, as applicable, in exchange for shares of People’s United common stock or People’s United preferred stock, as applicable, in the merger generally will not recognize any gain or loss upon the merger, except with respect to the cash received in lieu of a fractional share of M&T common stock.

For more detailed information, please refer to “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 135.

The United States federal income tax consequences described above may not apply to all holders of People’s United common stock or People’s United preferred stock. Your tax consequences will depend on your individual situation. Accordingly, we strongly urge you to consult your tax advisor for a full understanding of the particular tax consequences of the merger to you.

M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors (page 60)

The M&T board of directors has determined that the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance) are advisable and fair to and in the best interests of M&T and its shareholders and has unanimously approved and adopted the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance). The M&T board of directors unanimously recommends that M&T shareholders vote “FOR” the approval of the M&T charter amendment proposal, “FOR” the M&T share issuance proposal and “FOR” the other proposals presented at the M&T special meeting. For a more detailed discussion of the M&T board of directors’ recommendation, see “The Merger—M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors” beginning on page 60.

Opinion of M&T’s Financial Advisor (page 62)

M&T retained Lazard Frères & Co. LLC (“Lazard”) as its financial advisor in connection with the transaction. On February 19, 2021, Lazard rendered to the M&T board of directors its oral opinion, subsequently confirmed



 

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in a written opinion, dated February 19, 2021, that, as of such date, and based upon and subject to the assumptions, procedures, matters, qualifications and limitations set forth therein, the exchange ratio was fair, from a financial point of view, to M&T.

The full text of Lazard’s written opinion, dated February 19, 2021, which describes the assumptions made, procedures followed, matters considered and qualifications and limitations upon the scope of review undertaken by Lazard in preparing its opinion, is attached as Annex D and is incorporated by reference into this joint proxy statement/prospectus. The summary of the written opinion of Lazard, dated February 19, 2021, set forth in this joint proxy statement/prospectus is qualified in its entirety by the full text of Lazard’s written opinion attached as Annex D. You are encouraged to read Lazard’s opinion carefully and in its entirety.

Lazard’s financial advisory services and opinion were provided for the use and benefit of the M&T board of directors (in their capacity as directors and not in any other capacity) in connection with its evaluation of the transaction, and addressed only the fairness, from a financial point of view, as of the date thereof, of the exchange ratio to M&T. Lazard’s opinion is not intended to and does not constitute a recommendation to any M&T shareholder or any other person as to how such M&T shareholder or person should vote or act with respect to the transaction or any matter relating thereto. For a more complete discussion of Lazard’s opinion, see the section entitled “Opinion of M&T’s Financial Advisor.” You are encouraged to read the written opinion of Lazard, attached as Annex D, and the section entitled “The Merger—Opinion of M&T’s Financial Advisor” beginning on page 62 of this joint proxy statement/prospectus carefully and in their entirety.

For a description of the opinion of Lazard, see “The Merger—Opinion of M&T’s Financial Advisor” beginning on page 62.

People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors (page 71)

After careful consideration, the People’s United board, at a special meeting held on February 20, 2021, unanimously (i) determined that the merger agreement and the transactions contemplated thereby, including the merger, are in the best interests of People’s United and its shareholders, (ii) declared the merger agreement advisable and (iii) approved the execution, delivery and performance of the merger agreement and the consummation of the transactions contemplated thereby, including the merger. Accordingly, the People’s United board unanimously recommends that the People’s United common shareholders vote “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal. For a more detailed discussion of the People’s United board of directors’ recommendation, see “The Merger—People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors” beginning on page 71.

Opinions of People’s United’s Financial Advisors (page 74)

Opinion of Keefe, Bruyette & Woods, Inc. (page 74)

In connection with the merger, People’s United’s financial advisor, Keefe, Bruyette & Woods, Inc. (“KBW”), delivered a written opinion, dated February 20, 2021, to the People’s United board of directors as to the fairness, from a financial point of view and as of the date of the opinion, to the holders of People’s United common stock of the exchange ratio in the proposed merger. The full text of the opinion, which describes the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by KBW in preparing the opinion, is attached as Annex E to this document. The opinion was for the information of, and was directed to, the Peoples United board of directors (in its capacity as such) in connection with its consideration of the financial terms of the merger. The opinion does not address the underlying



 

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business decision of Peoples United to engage in the merger or enter into the merger agreement or constitute a recommendation to the Peoples United board of directors in connection with the merger, and it does not constitute a recommendation to any holder of Peoples United common stock or any shareholder of any other entity as to how to vote or act in connection with the merger or any other matter.

For more information, see “The Merger—Opinions of People’s United’s Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” beginning on page 74 and Annex E to this joint proxy statement/prospectus.

Opinion of J.P. Morgan Securities LLC (page 87)

Pursuant to an engagement letter, People’s United retained J.P. Morgan as its financial advisor in connection with the proposed transaction.

At the meeting of the People’s United board of directors on February 20, 2021, J.P. Morgan rendered its oral opinion, subsequently confirmed in J.P. Morgan’s written opinion dated as of February 20, 2021, to the People’s United board of directors that, as of such date and based upon and subject to the factors and assumptions set forth in its opinion, the exchange ratio in the proposed transaction was fair, from a financial point of view, to the holders of People’s United common stock.

The full text of the written opinion of J.P. Morgan, dated as of February 20, 2021, which sets forth, among other things, the assumptions made, matters considered and limits on the review undertaken, is attached as Annex F to this joint proxy statement/prospectus and is incorporated herein by reference. The summary of the opinion of J.P. Morgan set forth in this joint proxy statement/prospectus is qualified in its entirety by reference to the full text of such opinion. Holders of People’s United common stock are urged to read the opinion in its entirety. J.P. Morgan’s written opinion was addressed to the People’s United board of directors (in its capacity as such) in connection with and for the purposes of its evaluation of the proposed transaction, was directed only to the exchange ratio in the transaction and did not address any other aspect of the transaction. J.P. Morgan expressed no opinion as to the fairness of the consideration to be paid in connection with the transaction to the holders of People’s United preferred stock or any other holders of any class of securities, creditors or other constituencies of People’s United or as to the underlying decision by People’s United to engage in the proposed transaction. The issuance of J.P. Morgan’s opinion was approved by a fairness committee of J.P. Morgan. The opinion does not constitute a recommendation to any stockholder of People’s United as to how such stockholder should vote with respect to the proposed transaction or any other matter.

For more information, see “The Merger—Opinions of People’s United’s Financial Advisors—Opinion of J.P. Morgan Securities LLC” beginning on page 87 and Annex F to this joint proxy statement/prospectus.

Interests of Certain People’s United Directors and Executive Officers in the Merger (page 100)

In considering the recommendation of People’s United’s board of directors with respect to the merger, People’s United’s stockholders should be aware that the directors and executive officers of People’s United have certain interests in the mergers that may be different from, or in addition to, the interests of People’s United’s stockholders generally. These interests include, among others, the following:

 

   

People’s United equity awards (with the exception of People’s United restricted shares held by its non-employee directors (each, a “People’s United director restricted share”)) will be converted into equity awards of M&T based on the exchange ratio (with any applicable performance goals satisfied at the greater of the target and actual level of performance through the effective time). Except as specifically provided in the merger agreement or in the confidential disclosure schedules, following the effective time, each converted People’s United equity award will continue to be governed by the same terms and conditions as were applicable to such awards immediately prior to the effective time. See “The Merger Agreement—Treatment of People’s United Equity Awards” beginning on page 115;



 

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pursuant to the terms of the merger agreement and the confidential disclosure schedules, M&T will cause each People’s United option to be amended, effective as of the effective time, to provide that upon a termination of employment with M&T and its subsidiaries on or following the closing for any reason other than for “cause” (as defined in the applicable plan and/or award agreement governing such People’s United option), the exercise period for any vested People’s United option will be extended by an additional 27 months post-closing (but in no event beyond the original expiration of the term of the People’s United option);

 

   

each People’s United director restricted share will be converted based on the exchange ratio into the right to receive the merger consideration;

 

   

certain senior People’s United employees (including each of its five named executive officers) are party to a change-in-control agreement with People’s United (each a “change in control agreement”) that provides that if such employee’s employment is terminated without “cause” by People’s United, or if the employee terminates his or her employment for “good reason”, in each case, within three years following a change in control, including the merger, such employee will be provided with cash severance and certain other benefits;

 

   

pursuant to the terms of the merger agreement, M&T is required to use reasonable best efforts to provide each People’s United employee (the “change in control employees”) who has a change in control agreement with People’s United with a revised arrangement (a “revised change in control agreement”) whereby such change in control employee will receive the cash severance amounts payable to such change in control employee upon a termination without cause or a resignation for good reason during the protection period (as such terms are defined in the applicable change in control agreement) pursuant to the applicable change in control agreement, notwithstanding that the change in control employee will not then be eligible to receive such amount because he or she has not been involuntarily terminated by M&T other than for cause or resigned for good reason. See “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger—Revised Change in Control Agreements” beginning on page 103;

 

   

each of Messrs. Barnes and Walters has entered into a Non-Competition and Non-Solicitation Agreement with People’s United (each a “Restrictive Covenant Agreement”) which provides for lump-sum payments to be made within 30 days of the closing, subject to continued compliance with non-competition and non-solicitation covenants;

 

   

pursuant to the terms of the merger agreement and the confidential disclosure schedules, during the period commencing at the effective time, any continuing employee of People’s United, including each executive officer, who is involuntarily terminated or, if applicable, resigned for good reason, will be entitled to receive severance benefits, as follows: (i) ending on the third anniversary of the effective time, pursuant to any change in control agreement between such employee and People’s United, to the extent applicable; (ii) if such employee is a participant in the People’s Bank Change in Control Employee Severance Plan (the “2007 CIC Plan”), ending on the third anniversary of the effective time, pursuant to the 2007 CIC Plan; and (iii) to the extent such employee is neither party to a change in control agreement nor a participant in the 2007 CIC Plan, ending on the first anniversary of the effective time, as set forth in the confidential disclosure schedules;

 

   

pursuant to the terms of the merger agreement, prior to closing, People’s United will take any and all actions and adopt such necessary resolutions to terminate the ESOP and, if requested by M&T, the People’s United 401(k) plan. All participant accounts in the ESOP and, if terminated, the People’s United 401(k) plan, will become fully vested and participants will be permitted to rollover their account balances in the ESOP and their account balances (including notes in the case of loans) under the People’s United 401(k) plan to the M&T 401(k) plan;



 

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pursuant to the terms of the merger agreement, People’s United’s directors and executive officers are entitled to continued indemnification and insurance coverage. See “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger—Indemnification; Directors’ and Officers’ Insurance” beginning on page 105; and

 

   

at the effective time, certain of People’s United’s directors and executive officers will continue to serve as directors or executive officers, as applicable, of the combined company, and certain directors will be invited to serve as members of a transition advisory board. See “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger—Membership of the Board of Directors of M&T and M&T Bank” beginning on page 105.

People’s United’s board of directors was aware of these interests and considered them, among other matters, in making its recommendation that People’s United’s shareholders vote to approve the merger proposal. For more information, see “The Merger—Background of the Merger” beginning on page 55 and “The Merger—People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors” beginning on page 71. These interests are described in more detail below, and certain of them are quantified in the narrative and in the section entitled “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger” beginning on page  100.

Governance of the Combined Company After the Merger (page 107)

The merger agreement provides that, prior to the effective time, the board of directors of M&T will take all actions necessary so that five (5) directors of People’s United immediately prior to the effective time will be appointed to the board of directors of M&T as of the effective time (such appointed directors, the “People’s United designated directors”). The People’s United designated directors will include John P. Barnes and Kirk W. Walters, and the remaining three will be directors of People’s United as mutually agreed to by People’s United and M&T, who shall be independent of M&T in accordance with applicable stock exchange standards.

The merger agreement also provides that, on the closing date of the merger, M&T will invite all directors of People’s United immediately prior to the effective time other than the People’s United designated directors to become members of a transition advisory board, and will cause all such individuals who accept such invitation to be elected or appointed for a two (2)-year term as members of the advisory board. Such members of the advisory board will serve on the advisory board until the second (2nd) anniversary of the closing date of the merger or until their respective earlier death or resignation, during which period such members will each receive annual compensation of $40,000.

Regulatory Approvals (page 108)

Subject to the terms of the merger agreement, M&T and People’s United have agreed to cooperate with each other and use reasonable best efforts to promptly prepare and file all necessary documentation, to effect all applications, notices, petitions and filings (and in the case of the applications, notices, petitions and filings in respect of the requisite regulatory approvals (as defined in “The Merger—Regulatory Approvals”), use their reasonable best efforts to make such filings within thirty (30) days of the date of the merger agreement), to obtain as promptly as practicable all permits, consents, approvals and authorizations of all third parties and governmental entities which are necessary or advisable to consummate the transactions contemplated by the merger agreement (including the mergers), and to comply with the terms and conditions of all such permits, consents, approvals and authorizations of all such governmental entities. These approvals include, among others, the approval of the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”), the New York State Department of Financial Services (“NYDFS”), and the State of Connecticut Department of Banking (“CTDOB”). The initial submission of these regulatory applications occurred on March 22, 2021.



 

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Although neither M&T nor People’s United knows of any reason why it cannot obtain these regulatory approvals in a timely manner, M&T and People’s United cannot be certain when or if they will be obtained, or that the granting of these regulatory approvals will not involve the imposition of conditions on the completion of the merger, the holdco merger or the bank merger.

Expected Timing of the Merger

Neither M&T nor People’s United can predict the actual date on which the merger will be completed, or if the merger will be completed at all, because completion of the merger is subject to conditions and factors outside the control of both companies. People’s United must first obtain the approval of People’s United stockholders for the People’s United merger proposal, and M&T must obtain approval of M&T shareholders for the M&T charter amendment proposal and the M&T share issuance proposal. M&T and People’s United must also obtain necessary regulatory approvals and satisfy certain other closing conditions. M&T and People’s United expect the merger to be completed promptly once M&T and People’s United have obtained their respective shareholders’ and stockholders’ approvals noted above, have obtained necessary regulatory approvals, and have satisfied certain other closing conditions.

Conditions to Complete the Merger (page 131)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, the completion of the merger depends on a number of conditions being satisfied or, where legally permissible, waived. These conditions include:

 

   

the requisite M&T vote and the requisite People’s United vote having been obtained. See “The Merger Agreement—Meetings; Recommendation of M&T’s and People’s United Boards of Directors” beginning on page 128 for additional information regarding the “requisite M&T vote” and the “requisite People’s United vote”;

 

   

the authorization for listing on the NYSE, subject to official notice of issuance, of the M&T common stock and new M&T preferred stock to be issued in the merger;

 

   

all requisite regulatory approvals having been obtained and remaining in full force and effect, and all statutory waiting periods in respect thereof having expired or been terminated, without the imposition of any materially burdensome regulatory condition. See “The Merger—Regulatory Approvals” beginning on page 108 for additional information regarding the “requisite regulatory approvals” and the “materially burdensome regulatory condition”;

 

   

the effectiveness of the registration statement of which this joint proxy statement/prospectus is a part, and the absence of any stop order (or proceedings for such purpose initiated or threatened and not withdrawn);

 

   

no order, injunction or decree by any court or governmental entity of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement being in effect, and no law, statute, rule, regulation, order, injunction or decree having been enacted, entered, promulgated or enforced by any governmental entity which prohibits or makes illegal the consummation of the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement;

 

   

the accuracy of the representations and warranties of the other party contained in the merger agreement as of the date on which the merger agreement was entered into and as of the date on which the merger is completed, subject to the materiality standards provided in the merger agreement (and the receipt by each party of an officers’ certificate from the other party to such effect);



 

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the performance by the other party in all material respects of all obligations, covenants and agreements required to be performed by it under the merger agreement at or prior to the date on which the merger is completed (and the receipt by each party of an officers’ certificate from the other party to such effect); and

 

   

receipt by such party of an opinion of legal counsel to the effect that on the basis of facts, representations and assumptions set forth or referred to in such opinion, the merger and the holdco merger, taken together, will qualify as a “reorganization” within the meaning of Section 368(a) of the Code.

Termination of the Merger Agreement (page 131)

The merger agreement can be terminated at any time prior to completion of the merger, whether before or after the receipt of the requisite People’s United vote or the requisite M&T vote, in the following circumstances:

 

   

by mutual written consent of M&T and People’s United;

 

   

by either M&T or People’s United if any governmental entity that must grant a requisite regulatory approval has denied approval of the merger, the holdco merger or the bank merger and such denial has become final and nonappealable or any governmental entity of competent jurisdiction has issued a final and nonappealable order, injunction, decree or other legal restraint or prohibition permanently enjoining or otherwise prohibiting or making illegal the merger, the holdco merger or the bank merger, unless the failure to obtain a requisite regulatory approval is due to the failure of the party seeking to terminate the merger agreement to perform or observe its obligations, covenants and agreements under the merger agreement;

 

   

by either M&T or People’s United if the merger has not been completed on or before February 21, 2022 (the “termination date”), unless the failure of the merger to be completed by such date is due to the failure of the party seeking to terminate the merger agreement to perform or observe its obligations, covenants and agreements under the merger agreement;

 

   

by either M&T or People’s United (provided that the terminating party is not then in material breach of any representation, warranty, obligation, covenant or other agreement contained in the merger agreement) if there is a breach of any of the obligations, covenants or agreements or any of the representations or warranties (or any such representation or warranty ceases to be true) set forth in the merger agreement on the part of People’s United, in the case of a termination by M&T, or M&T or Merger Sub, in the case of a termination by People’s United, which either individually or in the aggregate would constitute, if occurring or continuing on the date the merger is completed, the failure of a closing condition of the terminating party and which is not cured within forty-five (45) days following written notice to the party committing such breach, or by its nature or timing cannot be cured during such period (or such fewer days as remain prior to the termination date);

 

   

by People’s United, if (i) M&T or the M&T board of directors has made a recommendation change or (ii) M&T or the M&T board of directors breaches in any material respect its obligations relating to non-solicitation of acquisition proposals or its obligations related to shareholder approval and the M&T board recommendation, see “The Merger Agreement—Meetings; Recommendation of M&T’s and People’s United’s Boards of Directors” beginning on page 127 for additional information regarding the “recommendation change”; or

 

   

by M&T, if (i) People’s United or the People’s United board of directors has made a recommendation change or (ii) People’s United or the People’s United board of directors breaches in any material respect its obligations relating to non-solicitation of acquisition proposals or its obligations related to stockholder approval and the People’s United board recommendation.



 

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Neither M&T nor People’s United is permitted to terminate the merger agreement as a result of any increase or decrease in the market price of M&T common stock or People’s United common stock.

Termination Fee (page 132)

If the merger agreement is terminated under certain circumstances, including circumstances involving alternative acquisition proposals and changes in the recommendation of M&T’s or People’s United’s respective boards, M&T or People’s United may be required to pay a termination fee to the other equal to $280 million.

Accounting Treatment (page 108)

The merger will be accounted for as an acquisition of People’s United by M&T under the acquisition method of accounting in accordance with accounting principles generally accepted in the United States (“GAAP”).

The Rights of People’s United Stockholders Will Change as a Result of the Merger (page 161)

The rights of People’s United stockholders are governed by Delaware law and the People’s United certificate of incorporation and the People’s United bylaws. In the merger, People’s United stockholders will become M&T shareholders, and their rights will be governed by New York law and the M&T certificate of incorporation, as amended by the M&T charter amendment, and the M&T bylaws. People’s United stockholders will have different rights once they become M&T shareholders due to differences between the People’s United governing documents and Delaware law, on the one hand, and the M&T governing documents and New York law, on the other hand. These differences are described in more detail under the section entitled “Comparison of the Rights of M&T Shareholders and People’s United Stockholders” beginning on page 161.

Listing of M&T Common Stock and New M&T Preferred Stock; Delisting and Deregistration of People’s United Common Stock and People’s United Preferred Stock (page 112)

The shares of M&T common stock and new M&T preferred stock to be issued in the merger will be listed for trading on the NYSE. Following the merger, shares of M&T common stock will continue to be traded on the NYSE. In addition, following the merger, People’s United common stock and People’s United preferred stock will be delisted from NASDAQ and deregistered under the Exchange Act.

The M&T Special Meeting (page 39)

The M&T special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time. At the M&T special meeting, M&T shareholders will be asked to vote on the following matters:

 

   

the M&T charter amendment proposal;

 

   

the M&T share issuance proposal; and

 

   

the M&T adjournment proposal.

You may vote at the M&T special meeting if you owned shares of M&T common stock at the close of business on [                ], 2021. As of [                ], 2021, there were [                ] shares of M&T common stock outstanding, of which less than [                ] percent ([    ]%) were owned and entitled to be voted by M&T directors and executive officers and their affiliates. We currently expect that M&T’s directors and executive officers will vote their shares in favor of the M&T merger proposal and the M&T charter amendment proposal, although none of them has entered into any agreements obligating them to do so.

The M&T charter amendment proposal will be approved if a majority of the outstanding shares of M&T common stock are voted in favor of such proposal. The M&T share issuance proposal and the M&T adjournment proposal will each be approved if a majority of the votes cast at the M&T special meeting are voted in favor of such



 

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proposal. If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the M&T special meeting or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the M&T charter amendment proposal, it will have the same effect as a vote “AGAINST” the M&T charter amendment proposal. If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the M&T special meeting or fail to instruct your bank or broker how to vote with respect to the M&T share issuance proposal or the M&T adjournment proposal, you will not be deemed to have cast a vote with respect to the M&T share issuance proposal or the M&T adjournment proposal, as applicable, and it will have no effect on the applicable proposal.

The People’s United Special Meeting (page 46)

The People’s United special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time. At the People’s United special meeting, People’s United stockholders will be asked to vote on the following matters:

 

   

the People’s United merger proposal;

 

   

the People’s United compensation proposal; and

 

   

the People’s United adjournment proposal.

You may vote at the People’s United special meeting if you owned shares of People’s United common stock at the close of business on [                ], 2021. As of [                ], 2021, there were [                ] shares of People’s United common stock outstanding, of which less than [                ] percent ([    ]%) were owned and entitled to be voted by People’s United directors and executive officers and their affiliates. We currently expect that People’s United’s directors and executive officers will vote their shares in favor of the People’s United merger proposal, although none of them has entered into any agreements obligating them to do so.

The People’s United merger proposal will be approved if a majority of the outstanding shares of People’s United common stock are voted in favor of such proposal. The People’s United compensation proposal and the People’s United adjournment proposal will be approved if a majority of the votes cast by People’s United stockholders at the People’s United special meeting are voted in favor of such proposal. If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the People’s United special meeting via the People’s United special meeting website or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the People’s United merger proposal, it will have the same effect as a vote “AGAINST” the People’s United merger proposal. If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the People’s United special meeting via the People’s United special meeting website or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the People’s United compensation proposal or the People’s United adjournment proposal, you will not be deemed to have cast a vote with respect to the People’s United compensation proposal or the People’s United adjournment proposal, as applicable, and it will have no effect on the applicable proposal.

Appraisal or Dissenters’ Rights in the Merger (page 112)

M&T shareholders are not entitled to dissenters’ rights under the NYBCL and People’s United stockholders are not entitled to appraisal rights under the DGCL. For more information, see “The Merger—Appraisal or Dissenters’ Rights in the Merger” beginning on page 112.

Risk Factors (page 31)

In evaluating the merger agreement, the merger or the issuance of shares of M&T common stock and new M&T preferred stock, you should carefully read this joint proxy statement/prospectus and give special consideration to the factors discussed in the section entitled “Risk Factors” beginning on page 31.



 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Some of the statements contained or incorporated by reference into this joint proxy statement/prospectus are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements are based on current expectations, estimates and projections about M&T’s and People’s United’s businesses, beliefs of M&T’s and People’s United’s management and assumptions made by M&T’s and People’s United’s management. Any statement that does not describe historical or current facts is a forward-looking statement, including statements regarding the expected timing, completion and effects of the proposed transactions and M&T’s and People’s United’s expected financial results, prospects, targets, goals and outlook. Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “target,” “estimate,” “continue,” “positions,” “prospects” or “potential,” by future conditional verbs such as “will,” “would,” “should,” “could,” or “may,” or by variations of such words or by similar expressions. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions (“Future Factors”) which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements.

Future Factors include, among others:

 

   

the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement;

 

   

the outcome of any legal proceedings that may be instituted against M&T or People’s United;

 

   

the possibility that the proposed transaction will not close when expected or at all because required regulatory, shareholder or other approvals are not received or other conditions to the closing are not satisfied on a timely basis or at all, or are obtained subject to conditions that are not anticipated;

 

   

the risk that any announcements relating to the proposed combination could have adverse effects on the market price of the common stock of either or both parties to the combination;

 

   

the possibility that the anticipated benefits of the transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where M&T and People’s United do business;

 

   

certain restrictions during the pendency of the merger that may impact the parties’ ability to pursue certain business opportunities or strategic transactions;

 

   

the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events;

 

   

diversion of management’s attention from ongoing business operations and opportunities;

 

   

potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the transaction;

 

   

M&T’s and People’s United’s success in executing their respective business plans and strategies and managing the risks involved in the foregoing;

 

   

the business, economic and political conditions in the markets in which the parties operate;

 

   

the risk that the proposed combination and its announcement could have an adverse effect on either or both parties’ ability to retain customers and retain or hire key personnel and maintain relationships with customers;



 

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the risk that the proposed combination may be more difficult or time-consuming than anticipated, including in areas such as sales force, cost containment, asset realization, systems integration and other key strategies;

 

   

the risk that revenues following the proposed combination may be lower than expected, including for possible reasons such as unexpected costs, charges or expenses resulting from the transactions;

 

   

the unforeseen risks relating to liabilities of M&T or People’s United that may exist;

 

   

the uncertainty as to the extent of the duration, scope, and impacts of the COVID-19 pandemic on People’s United, M&T and the proposed combination; and

 

   

other factors that may affect future results of M&T and People’s United.

These are representative of the Future Factors that could affect the outcome of the forward-looking statements. In addition, such statements could be affected by general industry and market conditions and growth rates, general economic and political conditions, either nationally or in the states in which M&T, People’s United or their respective subsidiaries do business, including interest rate and currency exchange rate fluctuations, changes and trends in the securities markets, and other Future Factors.

For any forward-looking statements made in this joint proxy statement/prospectus or in any documents incorporated by reference into this joint proxy statement/prospectus, M&T and People’s United claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this joint proxy statement/prospectus or the dates of the documents incorporated by reference in this joint proxy statement/prospectus. Except as required by applicable law, neither M&T nor People’s United undertakes to update these forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date the forward-looking statements are made.

For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please see the reports that M&T and People’s United have filed with the SEC as described under “Where You Can Find More Information” beginning on page 179.

We expressly qualify in their entirety all forward-looking statements attributable to either of us or any person acting on our behalf by the cautionary statements contained or referred to in this joint proxy statement/prospectus.



 

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RISK FACTORS

In addition to the other information contained in or incorporated by reference into this joint proxy statement/prospectus, including the matters addressed under the caption “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 29, People’s United stockholders should carefully consider the following risk factors in deciding whether to vote for the approval of the People’s United merger proposal, and M&T shareholders should carefully consider the following risk factors in deciding whether to vote for the approval of the M&T charter amendment proposal and the M&T share issuance proposal.

Risks Relating to the Consummation of the Merger and M&T Following the Merger

Because the market price of M&T common stock may fluctuate, People’s United stockholders cannot be certain of the market value of the merger consideration they will receive.

In the merger, each share of People’s United common stock issued and outstanding immediately prior to the effective time, including each People’s United director restricted share and except for certain shares owned by M&T or People’s United, will be converted into 0.118 of a share of M&T common stock. This exchange ratio is fixed and will not be adjusted for changes in the market price of either M&T common stock or People’s United common stock. Changes in the price of M&T common stock between now and the time of the merger will affect the value that People’s United stockholders will receive in the merger. Neither M&T nor People’s United is permitted to terminate the merger agreement as a result of any increase or decrease in the market price of M&T common stock or People’s United common stock.

Stock price changes may result from a variety of factors, including general market and economic conditions, changes in People’s United’s and M&T’s businesses, operations and prospects, the recent volatility in the prices of securities in global financial markets, including market prices of People’s United, M&T and other banking companies, the effects of the COVID-19 pandemic and regulatory considerations, many of which are beyond People’s United’s and M&T’s control. Therefore, at the time of the M&T special meeting and the People’s United special meeting, M&T shareholders and People’s United stockholders will not know the market value of the consideration that People’s United stockholders will receive at the effective time. You should obtain current market quotations for shares of M&T common stock and for shares of People’s United common stock.

The market price of M&T common stock after the merger may be affected by factors different from those currently affecting the market price of shares of People’s United common stock or M&T common stock.

In the merger, People’s United stockholders will become M&T shareholders. M&T’s business differs from that of People’s United. Accordingly, the results of operations of M&T and the market price of M&T common stock after the completion of the merger may be affected by factors different from those currently affecting the independent results of operations of each of M&T and People’s United. For a discussion of the businesses of M&T and People’s United and of certain factors to consider in connection with those businesses, see the documents incorporated by reference in this joint proxy statement/prospectus and referred to under “Where You Can Find More Information” beginning on page 179.

The opinion delivered by Lazard to M&T’s board of directors and the opinions delivered by KBW and J.P. Morgan to People’s United’s board of directors, respectively, prior to the entry into the merger agreement will not reflect changes in circumstances that may have occurred since the dates of the opinions.

The opinion from Lazard, which is M&T’s financial advisor, to M&T’s board of directors, and the opinions from KBW and J.P. Morgan, which are People’s United’s financial advisors, to People’s United’s board of directors were all delivered on and dated either February 19, 2021 or February 20, 2021. Changes in the operations and prospects of M&T or People’s United, general market and economic conditions and other factors which may be beyond the control of M&T and People’s United, including the ongoing effects of the COVID-19 pandemic on

 

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such market and economic conditions, and the market prices of M&T and People’s United, may have altered the value of M&T or People’s United or the prices of shares of M&T common stock and shares of People’s United common stock as of the date of this joint proxy statement/prospectus, or may alter such values and prices by the time the merger is completed. The opinions do not speak as of the date of this joint proxy statement/prospectus or as of any other date subsequent to the dates of those opinions.

Combining M&T and People’s United may be more difficult, costly or time-consuming than expected, and M&T and People’s United may fail to realize the anticipated benefits of the merger.

The success of the merger will depend, in part, on the ability to realize the anticipated cost savings from combining the businesses of M&T and People’s United. To realize the anticipated benefits and cost savings from the merger, which are expected to be approximately $330 million in annual pre-tax cost savings, M&T and People’s United must integrate and combine their businesses in a manner that permits those cost savings to be realized, without adversely affecting current revenues and future growth. If M&T and People’s United are not able to successfully achieve these objectives, the anticipated benefits of the merger may not be realized fully or at all or may take longer to realize than expected. In addition, the actual cost savings of the merger could be less than anticipated, and integration may result in additional and unforeseen expenses.

An inability to realize the full extent of the anticipated benefits of the merger and the other transactions contemplated by the merger agreement, as well as any delays encountered in the integration process, could have an adverse effect upon the revenues, levels of expenses and operating results of M&T following the completion of the merger, which may adversely affect the value of the common stock of M&T following the completion of the merger.

M&T and People’s United have operated and, until the completion of the merger, must continue to operate, independently. It is possible that the integration process could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the companies’ ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits and cost savings of the merger. Integration efforts between the two companies may also divert management attention and resources. These integration matters could have an adverse effect on each of M&T and People’s United during this transition period and on M&T for an undetermined period after completion of the merger.

The COVID-19 pandemic may delay and adversely affect the completion of the merger.

The COVID-19 pandemic has created economic and financial disruptions that have adversely affected, and are likely to continue to adversely affect, the business, financial condition, liquidity, capital and results of operations of M&T and People’s United. If the effects of the COVID-19 pandemic cause a continued or extended decline in the economic environment and the financial results of M&T or People’s United, or the business operations of M&T or People’s United are further disrupted as a result of the COVID-19 pandemic, efforts to complete the merger and integrate the businesses of M&T and People’s United may also be delayed and adversely affected. Additional time may be required to obtain the requisite regulatory approvals, and the Federal Reserve Board, the NYDFS, the CTDOB and/or other regulators may impose additional requirements on M&T or People’s United that must be satisfied prior to completion of the merger, which could delay and adversely affect the completion of the merger.

M&T may be unable to retain M&T and/or People’s United personnel successfully after the merger is completed.

The success of the merger will depend in part on M&T’s ability to retain the talents and dedication of key employees currently employed by M&T and People’s United. It is possible that these employees may decide not to remain with M&T or People’s United, as applicable, while the merger is pending or with M&T after the

 

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merger is completed. If M&T and People’s United are unable to retain key employees, including management, who are critical to the successful integration and future operations of the companies, M&T and People’s United could face disruptions in their operations, loss of existing customers, loss of key information, expertise or know-how and unanticipated additional recruitment costs. In addition, following the merger, if key employees terminate their employment, M&T’s business activities may be adversely affected, and management’s attention may be diverted from successfully integrating M&T and People’s United to hiring suitable replacements, all of which may cause M&T’s business to suffer. In addition, M&T and People’s United may not be able to locate or retain suitable replacements for any key employees who leave either company.

Regulatory approvals may not be received, may take longer than expected, or may impose conditions that are not presently anticipated or that could have an adverse effect on M&T following the merger.

Before the mergers may be completed, various approvals, consents and non-objections must be obtained from the Federal Reserve Board, the NYDFS, the CTDOB, and other regulatory authorities. In determining whether to grant these approvals, such regulatory authorities consider a variety of factors, including the regulatory standing of each party and the factors described under “The Merger—Regulatory Approvals” beginning on page 108. These approvals could be delayed or not obtained at all, including due to: an adverse development in either party’s regulatory standing or in any other factors considered by regulators when granting such approvals, including factors not known as of the date of this joint proxy statement/prospectus and factors that may arise in the future; governmental, political or community group inquiries, investigations or opposition; or changes in legislation or the political environment generally. The Federal Reserve Board has stated that if material weaknesses are identified by examiners before a banking organization applies to engage in expansionary activity, the Federal Reserve Board will expect the banking organization to resolve all such weaknesses before applying for such expansionary activity. The Federal Reserve Board has also stated that if issues arise during the processing of an application for expansionary activity, it will expect the applicant banking organization to withdraw its application pending resolution of any supervisory concerns.

The approvals that are granted may impose terms and conditions, limitations, obligations or costs, or place restrictions on the conduct of M&T’s business or require changes to the terms of the transactions contemplated by the merger agreement. There can be no assurance that regulators will not impose any such conditions, limitations, obligations or restrictions and that such conditions, limitations, obligations or restrictions will not have the effect of delaying the completion of any of the transactions contemplated by the merger agreement, imposing additional material costs on or materially limiting the revenues of M&T following the merger or otherwise reduce the anticipated benefits of the merger if the merger were consummated successfully within the expected timeframe. In addition, there can be no assurance that any such conditions, terms, obligations or restrictions will not result in the delay or abandonment of the merger. Additionally, the completion of the merger is conditioned on the absence of certain orders, injunctions or decrees by any court or regulatory agency of competent jurisdiction that would prohibit or make illegal the completion of any of the transactions contemplated by the merger agreement.

In addition, despite the parties’ commitments to use their reasonable best efforts to comply with conditions imposed by regulators, under the terms of the merger agreement, M&T will not be required, and People’s United will not be permitted without M&T’s prior written consent, to take actions or agree to conditions in connection with obtaining the foregoing permits, consents, approvals and authorizations of governmental entities that would reasonably be expected to have a material adverse effect on M&T and its subsidiaries, taken as a whole, after giving effect to the merger. See “The Merger—Regulatory Approvals” beginning on page 108.

The unaudited pro forma combined condensed financial information included in this joint proxy statement/prospectus is preliminary and the actual purchase price as well as the actual financial condition and results of operations of M&T after the merger may differ materially.

The unaudited pro forma combined condensed financial information in this joint proxy statement/prospectus is presented for illustrative purposes only and is not necessarily indicative of what M&T’s actual financial

 

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condition or results of operations would have been had the merger been completed on the dates indicated. The unaudited pro forma combined condensed financial information reflects adjustments, which are based upon preliminary estimates, to record the People’s United identifiable assets acquired and liabilities assumed at fair value and the resulting goodwill recognized. The purchase price allocation reflected in this document is preliminary, and final allocation of the purchase price will be based upon the actual purchase price and the fair value of the assets and liabilities of People’s United as of the date of the completion of the merger. Accordingly, the actual purchase price may vary significantly from the purchase price used in preparing the unaudited pro forma combined condensed financial information in this document. Accordingly, the final acquisition accounting adjustments may differ materially from the pro forma adjustments reflected in this document. For more information, see “Unaudited Pro Forma Combined Condensed Financial Statements” beginning on page 138.

Certain of People’s United’s directors and executive officers may have interests in the merger that may differ from the interests of People’s United stockholders.

People’s United stockholders should be aware that some of People’s United’s directors and executive officers may have interests in the merger and have arrangements that are different from, or in addition to, those of People’s United stockholders. These interests and arrangements may create potential conflicts of interest. The People’s United board of directors was aware of these respective interests and considered these interests, among other matters, when making its decisions to approve the merger agreement, and in recommending that People’s United stockholders vote to adopt the merger agreement. For a more complete description of these interests, please see “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger” beginning on page 100.

The merger agreement may be terminated in accordance with its terms and the merger may not be completed.

The merger agreement is subject to a number of conditions which must be fulfilled in order to complete the merger. Those conditions include: (1) approval by People’s United stockholders of the People’s United merger proposal and the approval by M&T’s shareholders of the M&T charter amendment proposal and the M&T share issuance proposal; (2) authorization for listing on the NYSE of the shares of M&T common stock and new M&T preferred stock to be issued in the merger, subject to official notice of issuance; (3) the receipt of required regulatory approvals, including the approval of the Federal Reserve Board, the NYDFS and the CTDOB; (4) effectiveness of the registration statement on Form S-4 of which this joint proxy statement/prospectus forms a part; and (5) the absence of any order, injunction, decree or other legal restraint preventing the completion of the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement or making the completion of the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement illegal. Each party’s obligation to complete the merger is also subject to certain additional customary conditions, including (a) subject to certain exceptions, the accuracy of the representations and warranties of the other party, (b) the performance in all material respects by the other party of its obligations under the merger agreement and (c) the receipt by such party of an opinion from its counsel to the effect that the merger and the holdco merger, taken together, will qualify as a reorganization within the meaning of Section 368(a) of the Code.

These conditions to the closing may not be fulfilled in a timely manner or at all, and, accordingly, the merger may not be completed. In addition, the parties can mutually decide to terminate the merger agreement at any time, before or after shareholder approval, or M&T or People’s United may elect to terminate the merger agreement in certain other circumstances. See “The Merger Agreement—Termination of the Merger Agreement” beginning on page 131.

Failure to complete the merger could negatively impact M&T or People’s United.

If the merger is not completed for any reason, including as a result of M&T shareholders failing to approve either the M&T charter amendment proposal or the M&T share issuance proposal or People’s United stockholders

 

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failing to approve the People’s United merger proposal, there may be various adverse consequences and M&T and/or People’s United may experience negative reactions from the financial markets and from their respective customers and employees. For example, M&T’s or People’s United’s businesses may have been impacted adversely by the failure to pursue other beneficial opportunities due to the focus of management on the merger, without realizing any of the anticipated benefits of completing the merger. Additionally, if the merger agreement is terminated, the market price of M&T common stock or People’s United common stock could decline to the extent that current market prices reflect a market assumption that the merger will be beneficial and will be completed. M&T and/or People’s United also could be subject to litigation related to any failure to complete the merger or to proceedings commenced against M&T or People’s United to perform their respective obligations under the merger agreement. If the merger agreement is terminated under certain circumstances, either M&T or People’s United may be required to pay a termination fee of $280 million to the other party.

Additionally, each of M&T and People’s United has incurred and will incur substantial expenses in connection with the negotiation and completion of the transactions contemplated by the merger agreement, as well as the costs and expenses of preparing, filing, printing and mailing this joint proxy statement/prospectus, and all filing and other fees paid in connection with the merger. If the merger is not completed, M&T and People’s United would have to pay these expenses without realizing the expected benefits of the merger.

M&T and People’s United will be subject to business uncertainties and contractual restrictions while the merger is pending.

Uncertainty about the effect of the merger on employees and customers may have an adverse effect on M&T and People’s United. These uncertainties may impair M&T’s or People’s United’s ability to attract, retain and motivate key personnel until the merger is completed, and could cause customers and others that deal with M&T or People’s United to seek to change existing business relationships with M&T or People’s United. In addition, subject to certain exceptions, People’s United has agreed to operate its business in the ordinary course in all material respects and to refrain from taking certain actions that may adversely affect its ability to consummate the merger on a timely basis without M&T’s consent, and M&T has agreed to refrain from taking certain actions that may adversely affect its ability to consummate the merger on a timely basis without People United’s consent. These restrictions may prevent M&T and/or People’s United from pursuing attractive business opportunities that may arise prior to the completion of the merger. See “The Merger Agreement—Covenants and Agreements” beginning on page 119 for a description of the restrictive covenants applicable to M&T and People’s United.

The merger agreement limits People’s United’s and M&T’s respective abilities to pursue alternatives to the merger and may discourage other companies from trying to acquire People’s United or M&T.

The merger agreement contains “no shop” covenants that restrict each of M&T’s and People’s United’s ability to, directly or indirectly, among other things, initiate, solicit, knowingly encourage or knowingly facilitate, inquiries or proposals with respect to, or, subject to certain exceptions generally related to the exercise of fiduciary duties by each respective board of directors, engage in any negotiations concerning, or provide any confidential or non-public information or data relating to, any alternative acquisition proposals. These provisions, which include a $280 million termination fee payable under certain circumstances, may discourage a potential third-party acquirer that might have an interest in acquiring all or a significant part of People’s United or M&T from considering or proposing that acquisition even if, in the case of a potential acquisition of People’s United, it were prepared to pay consideration with a higher per share price to People’s United stockholders than what is contemplated in the merger, or may result in a potential third-party acquirer proposing to pay a lower per share price to acquire People’s United or M&T than it might otherwise have proposed to pay. For more information, see “The Merger Agreement—Agreement Not to Solicit Other Offers; Termination of the Merger Agreement; Effect of Termination; Termination Fee” and “The Merger Agreement—Meetings; Recommendation of M&T’s and People’s United’s Boards of Directors” beginning on pages 129 and 128 respectively.

 

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The shares of M&T common stock to be received by People’s United stockholders as a result of the merger will have different rights from the shares of People’s United common stock.

In the merger, People’s United stockholders will become M&T shareholders and their rights as shareholders will be governed by New York law and the governing documents of M&T following the merger. The rights associated with M&T common stock are different from the rights associated with People’s United common stock. See “Comparison of the Rights of M&T Shareholders and People’s United Stockholders” beginning on page 161 for a discussion of the different rights associated with M&T common stock.

M&T and People’s United are expected to incur significant costs related to the merger and integration.

M&T and People’s United have incurred and expect to incur significant, non-recurring costs in connection with negotiating the merger agreement and closing the merger. In addition, M&T will incur integration costs following the completion of the merger as M&T integrates the People’s United business, including facilities and systems consolidation costs and employment-related costs. Anticipated future merger and integration-related pre-tax costs are currently estimated to be approximately $740 million.

There can be no assurances that the expected benefits and efficiencies related to the integration of the businesses will be realized to offset these transaction and integration costs over time. M&T and People’s United may also incur additional costs to maintain employee morale and to retain key employees. M&T and People’s United will also incur significant legal, financial advisory, accounting, banking and consulting fees, fees relating to regulatory filings and notices, SEC filing fees, printing and mailing fees and other costs associated with the merger. Some of these costs are payable regardless of whether the merger is completed. See “The Merger Agreement—Expenses and Fees” beginning on page 133.

General market conditions and unpredictable factors, including conditions and factors different from those affecting People’s United preferred stock currently, could adversely affect market prices for new M&T preferred stock shares once the new M&T preferred stock is issued.

There can be no assurance about the market prices for the new M&T preferred stock that will be issued upon completion of the merger. Several factors, many of which are beyond the control of M&T, could influence the market prices of the new M&T preferred stock, including:

 

   

whether M&T declares or fails to declare dividends on the new M&T preferred stock from time to time;

 

   

real or anticipated changes in the credit ratings assigned to the new M&T preferred stock or other M&T securities;

 

   

M&T’s creditworthiness;

 

   

interest rates;

 

   

developments in the securities, credit and housing markets, and developments with respect to financial institutions generally;

 

   

the market for similar securities; and

 

   

economic, corporate, securities market, geopolitical, public health (including the ongoing effects of COVID-19 pandemic), regulatory or judicial events that affect M&T, the banking industry or the financial markets generally.

Shares of new M&T preferred stock will be equity interests and will not constitute indebtedness. As such, new M&T preferred stock will rank junior to all indebtedness of, and other non-equity claims on, M&T with respect to assets available to satisfy claims. The market prices for the new M&T preferred stock following the merger may be affected by factors different from those currently affecting the People’s United preferred stock.

 

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Each current M&T shareholder or People’s United stockholder will have a reduced ownership and voting interest in M&T following the consummation of the merger than the holder’s ownership and voting interest in M&T or People’s United individually, as applicable, prior to the consummation of the merger and will exercise less influence over management.

M&T shareholders and People’s United stockholders currently have the right to vote in the election of the board of directors and on other matters affecting M&T and People’s United, respectively. When the merger is completed, each M&T shareholder and each People’s United stockholder will become an M&T shareholder, with a percentage ownership of M&T that is smaller than the holder’s percentage ownership of either M&T or People’s United individually, as applicable, prior to the consummation of the merger. Based on the number of shares of M&T and People’s United common stock outstanding as of the close of business on the respective record dates, and based on the number of shares of M&T common stock expected to be issued in the merger, the former People’s United stockholders, as a group, are estimated to own approximately [                ] percent ([    ]%) of the outstanding shares of M&T immediately after the merger and current M&T shareholders as a group are estimated to own approximately [                ] percent ([    ]%) of the fully diluted shares of M&T immediately after the merger. Because of this, People’s United stockholders may have less influence on the management and policies of M&T than they now have on the management and policies of People’s United, and M&T shareholders may have less influence on the management and policies of M&T when the merger is completed than they now have on the management and policies of M&T.

Issuance of shares of M&T common stock in connection with the merger may adversely affect the market price of M&T common stock.

In connection with the payment of the merger consideration, M&T expects to issue approximately [       ] million shares of M&T common stock to People’s United stockholders. The issuance of these new shares of M&T common stock may result in fluctuations in the market price of M&T common stock, including a stock price decrease.

M&T shareholders and People’s United stockholders will not have dissenters’ rights or appraisal rights in the merger.

Appraisal rights (also known as dissenters’ rights) are statutory rights that, if applicable under law, enable shareholders to dissent from an extraordinary transaction, such as a merger, and to demand that the corporation pay the fair value for their shares as determined by a court in a judicial proceeding instead of receiving the consideration offered to shareholders in connection with the extraordinary transaction.

Under Section 910 of the NYBCL, M&T shareholders will not be entitled to dissenters’ rights in connection with the merger. If the merger is completed, M&T shareholders will not receive any consideration, and their shares of M&T common stock will remain outstanding and will constitute shares of M&T following the completion of the merger. Accordingly, M&T shareholders are not entitled to any dissenters’ rights in connection with the merger.

Under Section 262 of the DGCL, People’s United stockholders will not be entitled to appraisal rights in connection with the merger if, on the record date of the People’s United special meeting, shares of People’s United’s common stock are listed on a national securities exchange are held of record by more than two thousand (2,000) stockholders, and People’s United stockholders are not required to accept as consideration for their shares anything other than the shares of M&T, shares of another corporation which at the effective date of the merger are either listed on a national securities exchange or held of record by more than two thousand (2,000) stockholders, cash paid in lieu of fractional shares or any combination of the foregoing. People’s United common stock is currently listed on the NASDAQ, a national securities exchange, and is expected to continue to be so listed on the record date for the People’s United special meeting. In addition, People’s United stockholders will receive shares of M&T common stock as consideration in the merger, which shares are currently listed on the NYSE, a national securities exchange, and are expected to continue to be so listed at the effective time. Accordingly, the holders of People’s United common stock are not entitled to any appraisal rights in connection with the merger.

 

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Shareholder or stockholder litigation could prevent or delay the completion of the merger or otherwise negatively impact the business and operations of M&T and People’s United.

Shareholders of M&T and/or stockholders of People’s United may file lawsuits against M&T, People’s United and/or the directors and officers of either company in connection with the merger. One of the conditions to the closing is that no order, injunction or decree issued by any court or governmental entity of competent jurisdiction or other legal restraint preventing the consummation of the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement be in effect. If any plaintiff were successful in obtaining an injunction prohibiting M&T or People’s United defendants from completing the merger, the holdco merger, the bank merger or any of the other transactions contemplated by the merger agreement, then such injunction may delay or prevent the effectiveness of the merger and could result in significant costs to M&T and/or People’s United, including any cost associated with the indemnification of directors and officers of each company. M&T and People’s United may incur costs in connection with the defense or settlement of any shareholder lawsuits filed in connection with the merger. Such litigation could have an adverse effect on the financial condition and results of operations of M&T and People’s United and could prevent or delay the completion of the merger.

The COVID-19 pandemic’s impact on M&T’s business and operations following the completion of the merger is uncertain.

The extent to which the COVID-19 pandemic will negatively affect the business, financial condition, liquidity, capital and results of operations of M&T following the completion of the merger will depend on future developments, which are highly uncertain and cannot be predicted, including the scope and duration of the COVID-19 pandemic, the direct and indirect impact of the COVID-19 pandemic on employees, clients, counterparties and service providers, as well as other market participants, and actions taken by governmental authorities and other third parties in response to the COVID-19 pandemic. Given the ongoing and dynamic nature of the circumstances, it is difficult to predict the impact of the COVID-19 pandemic on M&T’s business, and there is no guarantee that efforts by M&T to address the adverse impacts of the COVID-19 pandemic will be effective.

Even after the COVID-19 pandemic has subsided, M&T may continue to experience adverse impacts to its business as a result of the COVID-19 pandemic’s global economic impact, including reduced availability of credit, adverse impacts on liquidity and the negative financial effects from any recession or depression that may occur.

Risks Relating to M&T’s Business

You should read and consider risk factors specific to M&T’s business (including those related to the COVID-19 pandemic) that will also affect M&T after the merger. These risks are described in the sections entitled “Risk Factors” in M&T’s Annual Report on Form 10-K for the year ended December 31, 2020 and in other documents incorporated by reference into this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information” beginning on page 179 of this joint proxy statement/prospectus for the location of information incorporated by reference into this joint proxy statement/prospectus.

Risks Relating to People’s United’s Business

You should read and consider risk factors specific to People’s United’s business (including those related to the COVID-19 pandemic) that will also affect M&T following the completion of the merger. These risks are described in the sections entitled “Risk Factors” in People’s United’s Annual Report on Form 10-K for the year ended December 31, 2020 and in other documents incorporated by reference into this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information” beginning on page 179 of this joint proxy statement/prospectus for the location of information incorporated by reference into this joint proxy statement/prospectus.

 

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THE M&T SPECIAL MEETING

This section contains information for M&T shareholders about the special meeting that M&T has called to allow M&T shareholders to consider and vote on the M&T charter amendment proposal, the M&T share issuance proposal and other related matters. This joint proxy statement/prospectus is accompanied by a notice of the M&T special meeting, and a form of proxy card that the M&T board of directors is soliciting for use by M&T shareholders at the special meeting and at any adjournments or postponements of the special meeting.

Date, Time and Place of the Meeting

The M&T special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time. Due to the continuing public health impact of the COVID-19 pandemic and to support the well-being of our shareholders and employees, the M&T special meeting will be held in a virtual meeting format conducted via webcast.

Matters to Be Considered

At the M&T special meeting, M&T shareholders will be asked to consider and vote upon the following proposals:

 

   

the M&T charter amendment proposal;

 

   

the M&T share issuance proposal; and

 

   

the M&T adjournment proposal.

Recommendation of M&T’s Board of Directors

The M&T board of directors recommends that you vote “FOR” the M&T charter amendment proposal, “FOR” the M&T share issuance proposal and “FOR” the M&T adjournment proposal. See “The Merger—M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors” beginning on page 60 for a more detailed discussion of the M&T board of directors’ recommendation.

Record Date and Quorum

The M&T board of directors has fixed the close of business on [                ], 2021 as the record date for the determination of holders of M&T common stock entitled to notice of and to vote at the M&T special meeting. As of the M&T record date, there were [                ] shares of M&T common stock outstanding.

Holders of a majority of the shares of M&T common stock outstanding on the record date must be present, either in attendance virtually via the M&T special meeting website or by proxy, to constitute a quorum at the M&T special meeting. If you fail to submit a proxy prior to the special meeting or to vote at the M&T special meeting via the M&T special meeting website, your shares of M&T common stock will not be counted towards a quorum. Abstentions are considered present for purposes of establishing a quorum.

At the M&T special meeting, each share of M&T common stock is entitled to one (1) vote on all matters properly submitted to M&T shareholders.

As of the close of business on the M&T record date, M&T directors and executive officers and their affiliates owned and were entitled to vote approximately [                ] shares of M&T common stock, representing less than [                ] percent ([    ]%) of the outstanding shares of M&T common stock. We currently expect that M&T’s directors and executive officers will vote their shares in favor of the M&T charter amendment proposal, the M&T share issuance proposal and the M&T adjournment proposal, although none of them has entered into any agreements obligating them to do so.

 

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Vote Required; Treatment of Abstentions and Failure to Vote

M&T charter amendment proposal:

 

   

Vote required: Approval of the M&T charter amendment proposal requires the affirmative vote of a majority of the outstanding shares of M&T common stock. Approval of the M&T charter amendment proposal is a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or to vote at the M&T special meeting via the M&T special meeting website, or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the M&T charter amendment proposal, it will have the same effect as a vote “AGAINST” the M&T charter amendment proposal.

M&T share issuance proposal:

 

   

Vote required: Approval of the M&T share issuance proposal requires the affirmative vote of a majority of votes cast by M&T shareholders at the M&T special meeting. Approval of the M&T share issuance proposal is a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or to vote at the M&T special meeting via the M&T special meeting website, or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the M&T share issuance proposal, you will not be deemed to have cast a vote with respect to the M&T share issuance proposal and it will have no effect on the M&T share issuance proposal.

M&T adjournment proposal:

 

   

Vote required: Whether or not a quorum will be present at the meeting, approval of the M&T adjournment proposal requires the affirmative vote of a majority of the votes cast by M&T shareholders at the M&T special meeting. Approval of the M&T adjournment proposal is not a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or to vote at the M&T special meeting via the M&T special meeting website, or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the M&T adjournment proposal, you will not be deemed to have cast a vote with respect to the M&T adjournment proposal and it will have no effect on the M&T adjournment proposal.

Holders of M&T preferred stock are not entitled to and are not requested to vote at the M&T special meeting.

Attending the Virtual Special Meeting

The M&T special meeting may be accessed via the M&T special meeting website, where M&T shareholders will be able to listen to the M&T special meeting, submit questions and vote online. You are entitled to attend the M&T special meeting via the M&T special meeting website only if you were a shareholder of record at the close of business on the record date (a “record holder”) or you held your M&T shares beneficially in the name of a bank, broker, trustee or other nominee as of the record date (a “beneficial owner”), or you hold a valid proxy for the M&T special meeting.

If you are a record holder you will be able to attend the M&T special meeting online, ask questions and vote during the meeting by visiting [                ] and following the instructions. The password for the meeting, if requested, is [                ]. Please have your control number, which can be found on your proxy card, notice or email previously received, to access the meeting. If you are a beneficial owner, you also will be able to attend the M&T special meeting online, ask questions and vote during the meeting by visiting [                ] and following

 

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the instructions. The password for the meeting, if requested, is [                ]. Please have your control number, which can be found on your proxy card, notice or email previously received, to access the meeting. Please review this information prior to the M&T special meeting to ensure you have access.

See “—Shares Held in Street Name” below for further information.

Shareholders will have substantially the same opportunities to participate in the virtual M&T special meeting as they would have at a physical, in-person meeting. Shareholders as of the record date will be able to attend, vote, examine the shareholder list, and submit questions during a portion of the meeting via the online platform. To ensure the M&T special meeting is conducted in a manner that is fair to all shareholders, we may exercise discretion in determining the order in which questions are answered and the amount of time devoted to any one question. We reserve the right to edit or reject questions we deem inappropriate or not relevant to the M&T special meeting’s limited purpose.

Technical assistance will be available for shareholders who experience an issue accessing the M&T special meeting. Contact information for technical support will appear on the M&T special meeting website prior to the start of the M&T special meeting.

Proxies

A holder of M&T common stock may vote by proxy or at the M&T special meeting via the M&T special meeting website. If you hold your shares of M&T common stock in your name as a record holder, to submit a proxy, you, as a holder of M&T common stock, may use one of the following methods:

 

   

by telephone: by calling the toll-free number indicated on the accompanying proxy card and following the recorded instructions;

 

   

through the internet: by visiting the website indicated on the accompanying proxy card and following the instructions; or

 

   

by completing and returning the accompanying proxy card in the enclosed postage-paid envelope. The envelope requires no additional postage if mailed in the United States.

M&T requests that M&T shareholders vote by telephone, over the internet or by completing and signing the accompanying proxy card and returning it to M&T as soon as possible in the enclosed postage-paid envelope. When the accompanying proxy card is returned properly executed, the shares of M&T common stock represented by it will be voted at the M&T special meeting in accordance with the instructions contained on the proxy card. If you make no specification on your proxy card as to how you want your shares voted before signing and returning it, your proxy will be voted “FOR” the M&T charter amendment proposal, “FOR” the M&T share issuance proposal and “FOR” the M&T adjournment proposal.

If you are a beneficial owner, the holder should check the voting form used by that firm to determine whether the holder may vote by telephone or the internet.

Every vote is important. Accordingly, you should sign, date and return the enclosed proxy card, or vote via the internet or by telephone, whether or not you plan to attend the M&T special meeting virtually via the M&T special meeting website. Sending in your proxy card or voting by telephone or on the internet will not prevent you from voting your shares personally via the M&T special meeting website at the meeting because you may revoke your proxy at any time before it is voted.

Shares Held in Street Name

If your shares are held in “street name” through a broker, bank, trustee or other nominee, you must instruct the broker, bank, trustee or other nominee on how to vote your shares. Your broker, bank, trustee or other nominee will vote your shares only if you provide specific instructions on how to vote by following the instructions provided to you by your broker, bank, trustee or other nominee.

 

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Further, brokers, banks, trustees or other nominees who hold shares of M&T common stock on behalf of their customers may not give a proxy to M&T to vote those shares with respect to any of the proposals without specific instructions from their customers, as brokers, banks, trustees and other nominees do not have discretionary voting power on the proposals that will be voted upon at the M&T special meeting, including the M&T charter amendment proposal, the M&T share issuance proposal, and the M&T adjournment proposal.

Revocability of Proxies

If you directly hold shares of M&T common stock in your name as a record holder, you can change your vote at any time before your proxy is voted at your meeting. You can do this by:

 

   

submitting a written statement that you would like to revoke your proxy to the corporate secretary of M&T;

 

   

signing and returning a proxy card with a later date;

 

   

attending the special meeting virtually and voting by ballot at the special meeting; or

 

   

voting by telephone or the internet at a later time.

If your shares are held by a broker, bank, trustee or other nominee, you should contact your broker, bank, trustee or other nominee to change your vote.

Attendance virtually at the M&T special meeting will not in and of itself constitute revocation of a proxy. A revocation or later-dated proxy received by M&T after the vote will not affect the vote. M&T’s corporate secretary’s mailing address is: One M&T Plaza, Buffalo, New York 14203. If the M&T virtual special meeting is postponed or adjourned, it will not affect the ability of M&T shareholders of record as of the record date to exercise their voting rights or to revoke any previously granted proxy using the methods described above.

Delivery of Proxy Materials

As permitted by applicable law, only one copy of this joint proxy statement/prospectus is being delivered to M&T shareholders residing at the same address, unless such M&T shareholders have notified M&T of their desire to receive multiple copies of the joint proxy statement/prospectus.

M&T will promptly deliver, upon oral or written request, a separate copy of the joint proxy statement/prospectus to any M&T shareholder residing at an address to which only one copy of such document was mailed. Requests for additional copies should be directed M&T’s proxy solicitor, Georgeson, by calling toll-free at 1-866-856-4733.

Solicitation of Proxies

M&T and People’s United will share equally the expenses incurred in connection with the printing and mailing of this joint proxy statement/prospectus. To assist in the solicitation of proxies, M&T has retained Georgeson, and will pay Georgeson a fee of $15,000 plus reasonable expenses for these services. M&T and its proxy solicitor may also request banks, brokers, trustees and other intermediaries holding shares of M&T common stock beneficially owned by others to send this document to, and obtain proxies from, the beneficial owners and may reimburse such record holders for their reasonable out-of-pocket expenses in so doing. Solicitation of proxies by mail may be supplemented by telephone and other electronic means, advertisements and personal solicitation by the directors, officers or employees of M&T. No additional compensation will be paid to our directors, officers or employees for solicitation.

Other Matters to Come Before the M&T Special Meeting

M&T management knows of no other business to be presented at the M&T special meeting, but if any other matters are properly presented to the meeting or any adjournments thereof, the persons named in the proxies will vote upon them in accordance with the M&T board of directors’ recommendations.

 

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Assistance

If you need assistance in completing your proxy card, have questions regarding M&T’s special meeting or would like additional copies of this joint proxy statement/prospectus, please contact Shareholder Relations, M&T, One M&T Plaza, Buffalo, New York 14203, telephone 716-842-5138, e-mail ir@mtb.com, or M&T’s proxy solicitor, Georgeson, at the following address or phone number: 1290 Avenue of the Americas, 9th Floor

New York, NY 10104, or calling toll-free: 1-866-856-4733.

 

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M&T PROPOSALS

PROPOSAL 1: M&T CHARTER AMENDMENT PROPOSAL

Pursuant to the merger agreement, M&T is asking the M&T shareholders to approve an amendment to the M&T certificate of incorporation to effect an increase in the number of authorized shares of M&T capital stock from 251,000,000 to 270,000,000 and to effect an increase in the number of authorized shares of M&T’s preferred stock from 1,000,000 to 20,000,000, to be effective only upon the completion of the merger. A copy of the proposed certificate of amendment to the M&T certificate of incorporation is attached to this joint proxy statement/prospectus as Annex B. M&T shareholders should read the proposed certificate of amendment to the M&T certificate of incorporation in its entirety. The approval of the M&T charter amendment proposal by M&T shareholders is a condition to the completion of the merger.

After careful consideration, the M&T board of directors determined that the merger agreement and the transactions contemplated by the merger agreement are advisable and in the best interests of M&T and its shareholders and unanimously adopted and approved the merger agreement, the mergers and the other transactions contemplated by the merger agreement. See “The Merger— M&T’s Reasons for the Merger; Recommendation of M&T Board of Directors” beginning on page 60 for a more detailed discussion of the M&T board of directors’ recommendation.

The M&T board of directors unanimously recommends a vote “FOR” the M&T charter amendment proposal.

PROPOSAL 2: M&T SHARE ISSUANCE PROPOSAL

Pursuant to the merger agreement, M&T is asking M&T shareholders to approve the issuance of M&T common stock to People’s United stockholders. M&T shareholders should read this joint proxy statement/prospectus carefully and in its entirety, including the annexes, for more detailed information concerning the merger agreement and the mergers. A copy of the merger agreement is attached to this joint proxy statement/prospectus as Annex A.

After careful consideration, the M&T board of directors determined that the merger agreement and the transactions contemplated by the merger agreement are advisable and in the best interests of M&T and its shareholders and unanimously adopted and approved the merger agreement, the mergers and the other transactions contemplated by the merger agreement. See “The Merger— M&T’s Reasons for the Merger; Recommendation of the M&T Board of Directors” beginning on page 60 for a more detailed discussion of the M&T board of directors’ recommendation.

The M&T board of directors unanimously recommends a vote “FOR” the M&T share issuance proposal.

PROPOSAL 3: M&T ADJOURNMENT PROPOSAL

The M&T special meeting may be adjourned to another time or place, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the M&T special meeting to approve the M&T charter amendment proposal, the M&T share issuance proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to M&T shareholders. If, at the M&T special meeting, the number of shares of M&T common stock present or represented and voting in favor of M&T charter amendment proposal and/or the M&T share issuance proposal is insufficient to approve the M&T charter amendment proposal and/or the M&T share issuance proposal, as the case may be, M&T intends to move to adjourn the M&T special meeting in order to enable the M&T board of directors to solicit additional proxies for approval of the M&T charter amendment proposal and/or the M&T share issuance proposal, as the case may be. In that event, M&T will ask M&T shareholders to vote upon the M&T adjournment proposal, but not the M&T charter amendment proposal or the M&T share issuance proposal.

 

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In this proposal, M&T is asking M&T shareholders to authorize the holder of any proxy solicited by the M&T board of directors, on a discretionary basis, if a quorum is not present, and (i) if there are not sufficient votes at the time of the M&T special meeting to approve the M&T charter amendment proposal and/or the M&T share issuance proposal or (ii) if necessary or appropriate to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to M&T shareholders, to vote in favor of adjourning the M&T special meeting to another time and place for the purpose of soliciting additional proxies, including the solicitation of proxies from M&T shareholders who have previously voted. Pursuant to the M&T bylaws, the M&T special meeting may be adjourned without new notice being given.

The approval of the M&T adjournment proposal by M&T shareholders is not a condition to the completion of the merger.

The M&T board of directors unanimously recommends a vote “FOR” the M&T adjournment proposal.

 

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THE PEOPLE’S UNITED SPECIAL MEETING

This section contains information for People’s United stockholders about the special meeting that People’s United has called to allow People’s United stockholders to consider and vote on the People’s United merger proposal and other related matters. This joint proxy statement/prospectus is accompanied by a notice of the People’s United special meeting, and a form of proxy card that the People’s United board of directors is soliciting for use by People’s United stockholders at the special meeting and at any adjournments or postponements of the special meeting.

Date, Time and Place of the Meeting

The People’s United special meeting will be held virtually via the internet on [                ], 2021 at [                ], Eastern Time. In light of the ongoing developments related to the COVID-19 pandemic and to support the health and safety of our stockholders, employees and community, the People’s United special meeting will be held in a virtual-only format conducted via live webcast.

Matters to Be Considered

At the People’s United special meeting, People’s United stockholders will be asked to consider and vote upon the following proposals:

 

   

the People’s United merger proposal;

 

   

the People’s United compensation proposal; and

 

   

the People’s United adjournment proposal.

Recommendation of People’s United’s Board of Directors

The People’s United board of directors recommends that you vote “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal. See “The Merger—People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors” beginning on page 71 for a more detailed discussion of the People’s United board of directors’ recommendation.

Record Date and Quorum

The People’s United stockholders’ meeting committee of the board of directors has fixed the close of business on [                ], 2021 as the record date for determination of People’s United stockholders entitled to notice of and to vote at the People’s United special meeting. As of the record date, there were [                ] shares of People’s United common stock outstanding.

Holders of a majority of the outstanding shares of People’s United common stock entitled to vote at the People’s United special meeting must be present, either in attendance virtually via the People’s United special meeting website or by proxy, to constitute a quorum at the People’s United special meeting. If you fail to submit a proxy prior to the special meeting, or to vote at the People’s United special meeting via the People’s United special meeting website, your shares of People’s United common stock will not be counted towards a quorum. Abstentions are considered present for the purpose of establishing a quorum but will not be counted as shares present and entitled to vote at the meeting.

At the People’s United special meeting, each share of People’s United common stock is entitled to one (1) vote on all matters properly submitted to People’s United stockholders.

 

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As of the close of business on the People’s United record date, People’s United directors and executive officers and their affiliates owned and were entitled to vote approximately [                ] shares of People’s United common stock, representing less than [                ] percent ([    ]%) of the outstanding shares of People’s United common stock. We currently expect that People’s United’s directors and executive officers will vote their shares in favor of the People’s United merger proposal, the People’s United compensation proposal and the People’s United adjournment proposal, although none of them has entered into any agreements obligating them to do so.

Vote Required; Treatment of Abstentions and Failure to Vote

People’s United merger proposal:

 

   

Vote required: Approval of the People’s United merger proposal requires the affirmative vote of a majority of the outstanding shares of People’s United common stock. Approval of the People’s United merger proposal is a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or to vote at the People’s United special meeting via the People’s United special meeting website or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the People’s United merger proposal, it will have the same effect as a vote “AGAINST” the People’s United merger proposal.

People’s United compensation proposal:

 

   

Vote required: Approval of the People’s United compensation proposal requires the affirmative vote of a majority of the votes cast by People’s United stockholders at the People’s United special meeting. Approval of the People’s United compensation proposal is not a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the People’s United special meeting via the People’s United special meeting website or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the People’s United compensation proposal, you will not be deemed to have cast a vote with respect to the People’s United compensation proposal and it will have no effect on the People’s United compensation proposal.

People’s United adjournment proposal:

 

   

Vote required: Whether or not a quorum will be present at the meeting, approval of the People’s United adjournment proposal requires the affirmative vote of a majority of the votes cast by People’s United stockholders at the People’s United special meeting. Approval of the People’s United adjournment proposal is not a condition to the completion of the merger.

 

   

Effect of abstentions and broker non-votes: If you mark “ABSTAIN” on your proxy, fail to submit a proxy or vote at the People’s United special meeting via the People’s United special meeting website or fail to instruct your bank, broker, trustee or other nominee how to vote with respect to the People’s United adjournment proposal, you will not be deemed to have cast a vote with respect to the People’s United adjournment proposal and it will have no effect on the People’s United adjournment proposal.

Holders of People’s United preferred stock are not entitled to and are not requested to vote at the People’s United special meeting.

Attending the Virtual Special Meeting

The People’s United special meeting may be accessed via the People’s United special meeting website, where People’s United stockholders will be able to listen to the People’s United special meeting, submit questions and vote online. You are entitled to attend the People’s United special meeting via the People’s United special meeting website only if you were a stockholder of record at the close of business on the record date (a “record

 

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holder”) or you held your People’s United shares beneficially in the name of a bank, broker, trustee or other nominee as of the record date (a “beneficial owner”), or you hold a valid proxy for the People’s United special meeting.

If you are a record holder you will be able to attend the People’s United special meeting online, ask questions and vote during the meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM and following the instructions. Please have your 16-digit control number, which can be found on your proxy card, notice or email previously received, to access the meeting. If you are a beneficial owner, you also will be able to attend the People’s United special meeting online, ask questions and vote during the meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM and following the instructions. Please have your 16-digit control number, which can be found on the voting instructions provided by your bank, broker, trustee or other nominee, to access the meeting. Please review this information prior to the People’s United special meeting to ensure you have access.

See “—Shares Held in Street Name” below for further information.

Stockholders will have substantially the same opportunities to participate in the virtual People’s United special meeting as they would have at a physical, in-person meeting. Stockholders as of the record date will be able to attend, vote, examine the stockholder list, and submit questions during a portion of the meeting via the online platform. To ensure the People’s United special meeting is conducted in a manner that is fair to all stockholders, we may exercise discretion in determining the order in which questions are answered and the amount of time devoted to any one question. We reserve the right to edit or reject questions we deem inappropriate or not relevant to the People’s United special meeting’s limited purpose.

Technical assistance will be available for stockholders who experience an issue accessing the People’s United special meeting. Contact information for technical support will appear on the People’s United special meeting website starting fifteen (15) minutes prior to the start of the People’s United special meeting.

Proxies

A holder of People’s United shares may vote by proxy or at the People’s United special meeting via the People’s United special meeting website. If you hold your shares of People’s United common stock in your name as a record holder, to submit a proxy, you, as a holder of People’s United common stock, may use one of the following methods:

 

   

by telephone: by calling the toll-free number indicated on the accompanying proxy card and following the recorded instructions;

 

   

through the internet: by visiting the website indicated on the accompanying proxy card and following the instructions; or

 

   

by completing and returning the accompanying proxy card in the enclosed postage-paid envelope. The envelope requires no additional postage if mailed in the United States.

People’s United requests that People’s United stockholders vote by telephone, over the internet or by completing and signing the accompanying proxy card and returning it to People’s United as soon as possible in the enclosed postage-paid envelope. When the accompanying proxy card is returned properly executed, the shares of People’s United common stock represented by it will be voted at the People’s United special meeting in accordance with the instructions contained on the proxy card. If you make no specification on your proxy card as to how you want your shares voted before signing and returning it, your proxy will be voted “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal.

If you are a beneficial owner, you should check the voting form used by that firm to determine whether you may vote by telephone or the internet.

 

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Every vote is important. Accordingly, you should sign, date and return the enclosed proxy card, or vote via the internet or by telephone, whether or not you plan to attend the People’s United special meeting virtually via the People’s United special meeting website. Sending in your proxy card or voting by telephone or on the internet will not prevent you from voting your shares personally via the People’s United special meeting website at the meeting because you may revoke your proxy at any time before it is voted.

Shares Held in Street Name

If you are a beneficial owner, you will be able to attend the People’s United special meeting online, ask questions and vote during the meeting by visiting www.virtualshareholdermeeting.com/PBCT2021SM and following the instructions. Please have your 16-digit control number, which can be found on the voting instructions provided by your bank, broker, trustee or other nominee, to access the meeting. Please contact your bank, broker, trustee or other nominee to obtain further instructions.

If you do not attend the People’s United special meeting and wish to vote, you must instruct the bank, broker, trustee or other nominee on how to vote your shares. Your bank, broker, trustee or other nominee will vote your shares only if you provide specific instructions on how to vote by following the instructions provided to you by your bank, broker, trustee or other nominee.

Further, banks, brokers, trustees or other nominees who hold shares on behalf of their customers may not give a proxy to People’s United to vote those shares with respect to any of the proposals without specific instructions from their customers, as banks, brokers, trustees and other nominees do not have discretionary voting power on the proposals that will be voted upon at the People’s United special meeting, including the People’s United merger proposal, the People’s United compensation proposal and the People’s United adjournment proposal.

Revocability of Proxies

If you directly hold shares of People’s United common stock in your name as a record holder, you can change your proxy vote at any time before your proxy is voted at the People’s United special meeting. You can do this by:

 

   

submitting a written statement that you would like to revoke your proxy to the corporate secretary of People’s United;

 

   

signing and returning a proxy card with a later date;

 

   

attending the People’s United special meeting virtually and voting at the People’s United special meeting via the People’s United special meeting website; or

 

   

voting by telephone or the internet at a later time.

If you are a beneficial owner of People’s United common stock, you may change your vote by:

 

   

contacting your bank, broker, trustee or other nominee; or

 

   

attending and voting your shares at the People’s United special meeting virtually via the People’s United special meeting website if you have your 16-digit control number, which can be found on the voting instructions provided by your bank, broker, trustee or other nominee. Please contact your broker, bank, trustee or other nominee for further instructions.

Attendance virtually at the People’s United special meeting will not in and of itself constitute revocation of a proxy. A revocation or later-dated proxy received by People’s United after the vote will not affect the vote. People’s United’s corporate secretary’s mailing address is: 850 Main Street, Bridgeport, Connecticut 06604. If the People’s United virtual special meeting is postponed or adjourned, it will not affect the ability of People’s United stockholders of record as of the record date to exercise their voting rights or to revoke any previously granted proxy using the methods described above.

 

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Delivery of Proxy Materials

As permitted by applicable law, only one copy of this joint proxy statement/prospectus is being delivered to People’s United stockholders residing at the same address, unless such People’s United stockholders have notified People’s United of their desire to receive multiple copies of the joint proxy statement/prospectus.

People’s United will promptly deliver, upon oral or written request, a separate copy of the joint proxy statement/prospectus to any holder of People’s United common stock residing at an address to which only one copy of such document was mailed. Requests for additional copies should be directed to People’s United’s proxy solicitor, D.F. King & Co., Inc. by calling toll-free at (800) 207-3159.

Solicitation of Proxies

People’s United and M&T will share equally the expenses incurred in connection with the printing and mailing of this joint proxy statement/prospectus. To assist in the solicitation of proxies, People’s United has retained D.F. King & Co., Inc., for a fee of $20,000 plus reimbursement of certain costs and expenses incurred in connection with the solicitation. People’s United and its proxy solicitor will also request banks, brokers, trustees and other intermediaries holding shares of People’s United common stock beneficially owned by others to send this document to, and obtain proxies from, the beneficial owners and may reimburse such record holders for their reasonable out-of-pocket expenses in so doing. Solicitation of proxies by mail may be supplemented by telephone and other electronic means, advertisements and personal solicitation by the directors, officers or employees of People’s United. No additional compensation will be paid to People’s United’s directors, officers or employees for solicitation.

You should not send in any People’s United stock certificates with your proxy card (or, if you are a beneficial owner, your voting instruction card). The exchange agent will mail a transmittal letter with instructions for the surrender of stock certificates to People’s United stockholders as soon as practicable after completion of the merger.

Other Matters to Come Before the People’s United Special Meeting

People’s United management knows of no other business to be presented at the People’s United special meeting, but if any other matters are properly presented to the meeting or any adjournments thereof, the persons named in the proxies will vote upon them in accordance with the People’s United board of directors’ recommendations.

Assistance

If you need assistance in completing your proxy card, have questions regarding People’s United’s special meeting or would like additional copies of this joint proxy statement/prospectus, please contact Investor Relations, People’s United, 850 Main Street, Bridgeport, Connecticut 06604, telephone (203) 338-4851, or People’s United’s proxy solicitor, D.F. King & Co., Inc., by calling toll-free: (800) 207-3159.

 

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PEOPLE’S UNITED PROPOSALS

PROPOSAL 1: PEOPLE’S UNITED MERGER PROPOSAL

Pursuant to the merger agreement, People’s United is asking People’s United stockholders to approve the adoption of the merger agreement and the transactions contemplated thereby, including the merger. People’s United stockholders should read this joint proxy statement/prospectus carefully and in its entirety, including the annexes, for more detailed information concerning the merger agreement and the merger. A copy of the merger agreement is attached to this joint proxy statement/prospectus as Annex A.

After careful consideration, the People’s United board of directors, by a unanimous vote of all directors, approved the merger agreement and declared the merger agreement and the transactions contemplated thereby, including the merger, to be advisable and in the best interest of People’s United and People’s United stockholders. See “The Merger—People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors” beginning on page 71 for a more detailed discussion of the People’s United board of directors’ recommendation.

The approval of the People’s United merger proposal by People’s United stockholders is a condition to the completion of the merger.

The People’s United board of directors unanimously recommends a vote “FOR” the People’s United merger proposal.

PROPOSAL 2: PEOPLE’S UNITED COMPENSATION PROPOSAL

Pursuant to Section 14A of the Exchange Act and Rule 14a-21(c) thereunder, People’s United is seeking a non-binding, advisory stockholder approval of the compensation of People’s United’s named executive officers that is based on or otherwise relates to the merger as disclosed in the section entitled “The Merger—Interests of Certain People’s United Directors and Executive Officers in the Merger—Quantification of Potential Payments and Benefits to People’s United’s Named Executive Officers in Connection with the Merger—Golden Parachute Compensation” beginning on page 106. The proposal gives People’s United stockholders the opportunity to express their views on the merger-related compensation of People’s United’s named executive officers.

Accordingly, People’s United is asking People’s United stockholders to vote “FOR” the adoption of the following resolution, on a non-binding advisory basis:

“RESOLVED, that the compensation that will or may be paid or become payable to the People’s United named executive officers, in connection with the merger, and the agreements or understandings pursuant to which such compensation will or may be paid or become payable, in each case as disclosed pursuant to Item 402(t) of Regulation S-K in “Interests of Certain People’s United Directors and Executive Officers in the Merger—Quantification of Potential Payments and Benefits to People’s United’s Named Executive Officers in Connection with the Merger—Golden Parachute Compensation,” are hereby APPROVED.”

The advisory vote on the People’s United compensation proposal is a vote separate and apart from the votes on the People’s United merger proposal and the People’s United adjournment proposal. Accordingly, if you are a holder of People’s United common stock, you may vote to approve the People’s United merger proposal and/or the People’s United adjournment proposal and vote not to approve the People’s United compensation proposal, and vice versa. The approval of the People’s United compensation proposal by People’s United stockholders is not a condition to the completion of the merger. If the merger is completed, the merger-related compensation will be paid to People’s United’s named executive officers to the extent payable in accordance with the terms of the compensation agreements and arrangements even if People’s United stockholders fail to approve the advisory vote regarding merger-related compensation.

The People’s United board of directors unanimously recommends a vote “FOR” the advisory People’s United compensation proposal.

 

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PROPOSAL 3: PEOPLE’S UNITED ADJOURNMENT PROPOSAL

The People’s United special meeting may be adjourned to another time or place, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the People’s United special meeting to approve the People’s United merger proposal or to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to People’s United stockholders.

If, at the People’s United special meeting, the number of shares of People’s United common stock present or represented and voting in favor of the People’s United merger proposal is insufficient to approve the People’s United merger proposal, People’s United intends to move to adjourn the People’s United special meeting in order to enable the People’s United board of directors to solicit additional proxies for approval of the People’s United merger proposal. In that event, People’s United will ask People’s United stockholders to vote upon the People’s United adjournment proposal, but not the People’s United merger proposal or the People’s United compensation proposal.

In this proposal, People’s United is asking People’s United stockholders to authorize the holder of any proxy solicited by the People’s United board of directors on a discretionary basis (i) if there are not sufficient votes at the time of the People’s United special meeting to approve the People’s United merger proposal or (ii) if necessary or appropriate to ensure that any supplement or amendment to this joint proxy statement/prospectus is timely provided to People’s United stockholders, to vote in favor of adjourning the People’s United special meeting to another time and place for the purpose of soliciting additional proxies, including the solicitation of proxies from People’s United stockholders who have previously voted. Pursuant to the People’s United bylaws, the People’s United special meeting may be adjourned without new notice being given unless the adjournment is for more than thirty (30) days or if a new record date is set for the adjourned meeting.

The approval of the People’s United adjournment proposal by People’s United stockholders is not a condition to the completion of the merger.

The People’s United board of directors unanimously recommends a vote “FOR” the People’s United adjournment proposal.

 

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INFORMATION ABOUT THE COMPANIES

M&T Bank Corporation

M&T is a New York business corporation which is registered as a financial holding company under the BHC Act, and as a bank holding company under Article III-A of the New York Banking Law. M&T was incorporated in November 1969. As of December 31, 2020, M&T had consolidated total assets of $142.6 billion, deposits of $119.8 billion and shareholders’ equity of $16.2 billion. M&T had 16,718 full-time and 655 part-time employees as of December 31, 2020.

At December 31, 2020, M&T had two wholly owned bank subsidiaries: M&T Bank and Wilmington Trust, National Association. The banks collectively offer a wide range of retail and commercial banking, trust and wealth management, and investment services to their customers. At December 31, 2020, M&T Bank represented ninety-nine percent (99%) of consolidated assets of M&T, and had 716 domestic banking offices located in New York, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Virginia, West Virginia and the District of Columbia, a full-service commercial banking office in Ontario, Canada, and an office in George Town, Cayman Islands. As a commercial bank, M&T Bank offers a broad range of financial services to a diverse base of consumers, businesses, professional clients, governmental entities and financial institutions located in its markets.

M&T’s common stock is traded on the NYSE under the symbol “MTB.” The principal executive offices of M&T are located at One M&T Plaza, Buffalo, New York 14203, and its telephone number is (716) 635-4000.

People’s United

People’s United is a bank holding company and a financial holding company registered under the BHC Act, and is incorporated under the state laws of Delaware. People’s United is the holding company for People’s United Bank, National Association (“People’s United Bank”), a national banking association headquartered in Bridgeport, Connecticut. As of December 31, 2020, People’s United had consolidated total assets of $63.1 billion, deposits of $52.1 billion and stockholders’ equity of $7.6 billion. People’s United had 5,640 full-time, 287 part-time and 60 temporary employees as of December 31, 2020.

The principal business of People’s United is to provide, through People’s United Bank and its subsidiaries, commercial banking, retail banking and wealth management services to individual, corporate and municipal customers. Traditional banking activities are conducted primarily within New England and southeastern New York, and include extending secured and unsecured commercial and consumer loans, originating mortgage loans secured by residential and commercial properties, and accepting consumer, commercial and municipal deposits.

In addition to traditional banking activities, People’s United Bank provides specialized financial services tailored to specific markets including: personal, institutional and employee benefit trust; cash management; and municipal banking. Through its non-banking subsidiaries, People’s United Bank offers: equipment financing through People’s Capital and Leasing Corp., People’s United Equipment Finance Corp. and LEAF Commercial Capital, Inc.; brokerage, financial advisory services, investment management services and life insurance through People’s Securities, Inc.; and investment advisory services and financial management and planning services through People’s United Advisors, Inc.

People’s United’s common stock is traded on the NASDAQ Global Select Market under the symbol “PBCT.” The principal executive offices of People’s United are located at 850 Main Street, Bridgeport, Connecticut 06604, and its telephone number is (203) 338-7171.

Merger Sub

Merger Sub, a direct, wholly owned subsidiary of M&T, is a Delaware corporation that was incorporated for the sole purpose of effecting the merger. In the merger, Merger Sub will merge with and into People’s United, with

 

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People’s United surviving as a direct, wholly owned subsidiary of M&T and the separate corporate existence of Merger Sub will cease.

Its principal executive office is located at c/o M&T Bank Corporation, One M&T Plaza, Buffalo, New York 14203, and its telephone number is (716) 635-4000.

 

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THE MERGER

This section of the joint proxy statement/prospectus describes material aspects of the merger. This summary may not contain all of the information that is important to you. You should carefully read this entire joint proxy statement/prospectus and the other documents we refer you to for a more complete understanding of the merger. In addition, we incorporate important business and financial information about each of us into this document by reference. You may obtain the information incorporated by reference into this document without charge by following the instructions in the section entitled “Where You Can Find More Information” beginning on page 179.

Terms of the Merger

Each of M&T’s and People’s United’s respective board of directors has approved the merger agreement. The merger agreement provides that, pursuant to the terms and subject to the conditions set forth in the merger agreement, Merger Sub will merge with and into People’s United, with People’s United as the surviving entity, which is referred to as the merger, and as soon as reasonably practicable following the merger, People’s United will merge with and into M&T, with M&T as the surviving entity, which is referred to as the holdco merger. At a date and time following the holdco merger as determined by M&T, People’s United Bank will merge with and into M&T Bank, with M&T Bank as the surviving bank, which is referred to as the bank merger.

In the merger, each share of People’s United common stock issued and outstanding immediately prior to the effective time, including each People’s United director restricted share and except for certain shares owned by M&T or People’s United, will be converted into the right to receive 0.118 of a share of M&T common stock. M&T will not issue any fractional shares of M&T common stock in the merger. Instead, a former holder of People’s United common stock who otherwise would have received a fraction of a share of M&T common stock will receive for the fraction of a share an amount in cash (rounded to the nearest cent) based on the M&T closing share value.

In the merger, each share of People’s United preferred stock issued and outstanding immediately prior to the effective time will be converted into the right to receive one (1) share of new M&T preferred stock. For a description of the terms of the new M&T preferred stock, see the section entitled “Description of New M&T Preferred Stock” beginning on page 151.

M&T shareholders are being asked to approve the M&T charter amendment proposal and the M&T share issuance proposal and People’s United stockholders are being asked to approve the People’s United merger proposal. See the section entitled “The Merger Agreement” beginning on page 113 for additional and more detailed information regarding the legal documents that govern the merger, including information about the conditions to the completion of the merger and the provisions for terminating or amending the merger agreement.

Background of the Merger

As part of the ongoing consideration and evaluation of their respective long-term prospects and strategies, each of M&T’s and People’s United’s boards of directors and managements have regularly reviewed and assessed their respective business strategies and objectives, including assessments of potentially available strategic growth opportunities, as part of their respective efforts to enhance value for their respective shareholders and stockholders and deliver the best possible services to their respective customers and communities. These reviews have focused on, among other things, prospects and developments in the financial services industry, the regulatory environment and the economy generally, and the implications of such developments for financial institutions generally and M&T and People’s United in particular. These reviews have also included assessments of ongoing consolidation in the financial services industry and the benefits and risks to M&T and People’s United, respectively, and their respective shareholders and stockholders of strategic combinations. Both M&T and People’s United have regularly pursued acquisitions and other business combinations as a means to achieve their respective strategic goals.

 

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Mr. René F. Jones, M&T’s chairman and chief executive officer, and Mr. John P. Barnes, People’s United’s chairman and chief executive officer, have periodically discussed trends in the financial services industry and matters of mutual interest to their respective institutions. These discussions have occurred during the course of investor and banking industry conferences and social and community settings. In addition and prior to the communications described below, Messrs. Jones and Barnes had on several occasions discussed the potential strategic benefits of a business combination between the two companies, but these discussions were preliminary and no specific price or other terms were discussed or agreed.

On December 23, 2020, Mr. Jones called Mr. Barnes to inquire about People’s United’s interest in discussing the possibility of a merger between the two companies. Mr. Barnes briefed Mr. George Carter, People’s United’s lead director, regarding his conversation with Mr. Jones. Mr. Carter expressed his support for Mr. Barnes to engage in preliminary discussions with M&T regarding the feasibility and potential benefits of a possible merger with M&T. On December 28, 2020, Mr. Jones called Mr. Barnes to discuss dates for an in person meeting to discuss a potential merger in greater detail. Messrs. Jones and Barnes spoke again on January 4, 2021 about the potential benefits of a stock-for-stock merger and the possible terms of such a transaction. Based on these conversations, both chief executive officers agreed that it would be useful to meet in person to further explore a possible business combination.

On January 7, 2021, Messrs. Jones and Barnes met to discuss the merits of exploring a potential transaction in which M&T would acquire People’s United in a stock-for-stock transaction, and exchanged their respective preliminary views regarding valuation, which included a discussion of potential exchange ratios of 0.118 to 0.12 (representing an approximately 28% pro forma ownership by People’s United common stockholders in the combined company and a market premium at that time of approximately 15%). Messrs. Jones and Barnes also discussed transaction structure, community commitments, employee retention matters, governance and potential post-merger arrangements with Mr. Barnes and Mr. Kirk W. Walters, People’s United’s senior executive vice president, corporate development & strategic planning, and other terms. Messrs. Jones and Barnes agreed to review these matters with their respective boards of directors and continue to discuss the potential financial and other terms of a transaction (including potential frameworks for establishing the exchange ratio) to see if such a transaction on mutually agreeable terms was feasible.

Following this meeting, Mr. Barnes briefed Mr. Carter on the discussions at the meeting, and over the course of the following week, Mr. Barnes also discussed the opportunity of exploring a potential transaction with each of the other People’s United directors.

On January 14, 2021, the executive committee of the M&T board of directors held a meeting. At the meeting, Mr. Jones informed the executive committee members of a potential transaction with People’s United, including discussing the strategic rationale of the potential transaction. The members of the executive committee discussed the terms of the potential transaction, including potential frameworks for determining the exchange ratio, and potential synergies. Mr. Jones also informed the executive committee members that he would report the potential transaction to the other directors at the upcoming meeting of the M&T board of directors to be held on January 20, 2021.

During the weeks following the January 7, 2021 meeting between the two companies’ chief executive officers, the two companies and their advisors discussed potential frameworks for establishing the exchange ratio (which frameworks would take into account, among other factors, the pro forma ownership of M&T shareholders and People’s United common stockholders in the combined company, the potential premium that People’s United common stockholders would receive in a potential transaction, relative market prices of M&T’s and People’s United’s common stock and other valuation-related factors), as well as governance, employee retention and community issues.

On January 20, 2021, at a meeting of the M&T board of directors, Mr. Jones informed members of the board that management was considering the strategic and financial implications for M&T of a possible acquisition of

 

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People’s United. M&T management discussed management’s approach to the proposed transaction and the risks and opportunities of the proposed transaction, including, among other matters, the potential financial terms (including potential frameworks proposed by each side for determining the exchange ratio), governance and community considerations and cultural alignment, timing and regulatory implications of the potential transaction. Members of M&T management responded to various questions from the directors regarding the proposed transaction. Following the discussion, the M&T board of directors expressed support for the proposed transaction based on the range of potential terms and authorized M&T management to proceed with their negotiations of a potential acquisition of People’s United consistent with those terms.

On January 21, 2021, the People’s United board of directors held a meeting to discuss the potential transaction with M&T, with representatives of KBW and Simpson Thacher & Bartlett LLP (“Simpson Thacher”), legal counsel to People’s United, in attendance. Messrs. Barnes and Walters reported to the People’s United board of directors on the various discussions they and other representatives of People’s United management and People’s United’s financial and legal advisors had with representatives of M&T regarding the potential transaction, including potential frameworks for establishing the exchange ratio and governance, employee retention and community issues. A representative of KBW provided the People’s United board of directors with, among other information, an overview of the transactional landscape in the banking industry, publicly available information regarding M&T’s and People’s United’s financial and operating performance, potential strategic considerations for a merger with M&T, including the potential for certain strategic and operational benefits that could result from a business combination with M&T, and other potential strategic alternatives for People’s United, including a group of other potential merger partners. A representative of Simpson Thacher reviewed with the People’s United board of directors the directors’ fiduciary duties under Delaware law and then discussed with the People’s United board of directors the terms for the potential transaction that were being discussed between People’s United and M&T. Following discussion, the People’s United directors expressed their support for continuing to explore the feasibility and potential benefits of a potential transaction and directed Messrs. Barnes and Walters and other members of People’s United management, with the assistance of KBW and Simpson Thacher, to continue their discussions and negotiations with M&T and its advisors regarding such a transaction.

Over the following weeks, Messrs. Jones and Barnes and other members of M&T’s and People’s United’s management, with the assistance of their respective companies’ financial and legal advisors, continued to discuss and negotiate the terms of the potential transaction.

On January 25, 2021, M&T and People’s United executed a mutual nondisclosure agreement in order to facilitate more detailed discussions of a potential business combination and reciprocal due diligence efforts. People’s United made available to M&T, and M&T made available to People’s United, documents for mutual due diligence review in virtual data rooms. Through February 21, 2020, the parties engaged in mutual due diligence, including through a series of virtual due diligence meetings and telephone calls between the parties and their respective representatives to discuss relevant topics.

Between January 15, 2021 and January 28, 2021, the parties and their advisors held numerous meetings regarding the exchange ratio and the other terms of the potential transaction. On January 28, 2021, Messrs. Jones and Barnes agreed, subject to completion of the mutual due diligence reviews and negotiation of other mutually agreeable transaction terms, to propose to their respective boards of directors that the exchange ratio in the proposed transaction be fixed at 0.118, which would result in People’s United stockholders owning approximately 28% of the combined company following the completion of the proposed merger.

On February 3, 2021, M&T and People’s United executed a mutual exclusivity agreement pursuant to which each party agreed, until the earlier of the execution of a definitive agreement and 11:59 p.m. New York City time on February 28, 2021, to negotiate exclusively with the other party regarding a possible business combination.

On February 4, 2021, the People’s United board of directors held a meeting to discuss the potential transaction, with representatives of KBW, J.P. Morgan and Simpson Thacher in attendance. Mr. Barnes updated the People’s

 

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United board of directors regarding the discussions between People’s United and M&T and their respective advisors since the last People’s United board of directors meeting, including that he and Mr. Jones had preliminarily agreed to move forward on the basis of an exchange ratio of 0.118, subject to board of directors approval, and the status of M&T’s ongoing due diligence review of People’s United. Representatives of KBW then reviewed with the People’s United board of directors certain financial aspects of the potential transaction based on the proposed exchange ratio. A representative of Simpson Thacher then discussed various terms of the potential transaction that were being discussed between People’s United and M&T. After Messrs. Barnes and Walters had left the meeting, the People’s United directors discussed the proposed agreements to be entered into with Messrs. Barnes and Walters in connection with and to be effective upon the closing of the potential transaction, which based on discussions with M&T, included three-year comprehensive non-competition / non-solicitation agreements.

On February 10, 2021, Sullivan & Cromwell LLP (“Sullivan & Cromwell”), legal counsel to M&T, shared with Simpson Thacher a first draft of the proposed merger agreement. From February 10, 2021 until February 21, 2021, M&T’s and People’s United’s legal advisors negotiated the proposed merger agreement and other transaction documents.

On February 11, 2021, the People’s United board of directors held a meeting to discuss recent developments and updates regarding the ongoing discussions with respect to a potential transaction with M&T, including regarding the terms that were still being negotiated between the parties, the mutual due diligence review and the timing for a potential transaction announcement.

On February 12, 2021, Mr. Jones updated the executive committee of the M&T board of directors regarding M&T’s possible acquisition of People’s United, including a discussion of the regulatory implications of the potential transaction.

On February 17, 2021, the boards of directors of M&T and M&T Bank held a joint meeting to discuss the potential transaction with People’s United, with representatives of Lazard and Sullivan & Cromwell in attendance. Mr. Jones provided the directors with an update on the strategic and financial implications for M&T of the potential transaction. M&T’s general counsel and a representative of Sullivan & Cromwell then provided the M&T and M&T Bank boards of directors with an overview of certain legal considerations, including the directors’ fiduciary duties in connection with their consideration of the potential transaction with People’s United. Subsequently, various members of M&T management provided the directors with updates regarding the status and key findings of M&T’s due diligence review of People’s United and provided various other updates on the status of the potential transaction. Representatives of Lazard then provided an overview of various aspects of the potential transaction from a financial perspective, including a market perspective on People’s United, the pro forma impact of the proposed transaction on M&T, and perspectives from precedent transactions. Representatives of Sullivan & Cromwell then provided an overview of the current drafts of the transaction agreements and legal process. The meeting recessed until February 19, 2021.

On February 18, 2021, the People’s United board of directors held a meeting to discuss, among other matters, the potential transaction with M&T, with representatives of KBW, J.P. Morgan and Simpson Thacher in attendance. Mr. Barnes provided an update regarding the status of discussions and negotiations of a potential transaction with M&T since the February 4, 2021 People’s United board of directors meeting. KBW and J.P. Morgan each reviewed and discussed with the People’s United board of directors, among other matters, the financial aspects of the proposed transaction and their preliminary financial analyses based on the proposed 0.118 exchange ratio. Mr. Walters then reviewed with the People’s United board of directors the status and process of the mutual due diligence of M&T and People’s United, including the key findings of People’s United’s due diligence review of M&T. A Simpson Thacher representative reviewed with the People’s United board of directors certain legal considerations, including the directors’ fiduciary duties in connection with their consideration of a potential transaction with M&T, and the principal terms of the draft merger agreement. After Messrs. Barnes and Walters had left the meeting, the remaining People’s United directors reviewed the terms of the proposed

 

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non-competition agreements to be entered into with Messrs. Barnes and Walters in connection with a potential transaction, to become effective upon completion of the transaction. Following discussion, and after taking into consideration the favorable recommendation of People’s United’s compensation committee, the People’s United directors approved the proposed agreements. For a description of such agreements, see “—Interests of Certain People’s United Directors and Executive Officers in the Merger” beginning on page 100.

During the rest of that day and through February 21, 2021, M&T’s and People’s United’s management teams, with the assistance of the parties’ respective legal advisors, continued to finalize the merger agreement and other transaction documents.

On February 19, 2021, the M&T and M&T Bank boards of directors resumed its joint meeting which had commenced on February 17, 2021. Representatives of Lazard and Sullivan & Cromwell were in attendance. Mr. Jones noted that the management was proceeding with steps to move forward with the potential transaction, summarizing the progress made since the M&T and M&T Bank boards of directors recessed on February 17, 2021. A representative of M&T management updated the directors on the final terms of the proposed merger agreement and reported that the negotiations were nearly complete. Representatives of Lazard then presented its fairness analysis and rendered to the M&T board of directors its oral opinion, which was confirmed by a written opinion dated February 19, 2021, to the effect that, as of that date and subject to the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken as set forth in such opinion, the exchange ratio in the proposed transaction was fair, from a financial point of view, to M&T. See “The Merger—Opinion of M&T’s Financial Advisor” beginning on page 62. Representatives of Lazard also responded to questions from the directors. The directors then engaged in a discussion regarding various aspects of the potential transaction, including the factors described under the section of this joint proxy statement/prospectus entitled “—M&T’s Reasons for the Merger; Recommendation of the M&T Board of Directors.” Following these discussions, Mr. Jones presented management’s recommendation for the approval of resolutions authorizing M&T to enter into the merger agreement. The directors were then informed that their written approval would be sought in the form of a unanimous written consent, which proposal would be e-mailed to them immediately following the conclusion of the meeting.

On February 20, 2021, the M&T board of directors, via a unanimous written consent, effective as of that date, determined that the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance) were advisable and fair to and in the best interests of M&T and its shareholders, approved and adopted the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance), and recommended the approval and adoption by M&T shareholders of the M&T charter amendment proposal, the M&T share issuance proposal and the other matters to be voted upon at the M&T special meeting in accordance with the merger agreement. See “—M&T’s Reasons for the Merger; Recommendation of the M&T Board of Directors.”

On February 20, 2021, the People’s United board and the People’s United Bank board of directors held a joint meeting to discuss the potential transaction with M&T, with representatives of KBW, J.P. Morgan and Simpson Thacher in attendance. Mr. Barnes updated the People’s United board of directors on the final negotiations with M&T relating to the potential transaction. A representative of Simpson Thacher updated the directors on the final terms of the proposed merger agreement. KBW and J.P. Morgan then each discussed the updates to the financial aspects of the potential transaction and the financial analyses they each had reviewed with the People’s United board of directors at the February 18, 2021 meeting. The KBW and J.P. Morgan representatives also observed, among other things, that, based on the respective trading prices of the two companies’ shares through the close of trading on February 19, 2021, the proposed exchange ratio of 0.118 represented a 13% premium to People’s United common stock closing price on February 19, 2021 and a pro forma ownership by People’s United common shareholders in the combined company of approximately 28%. Following the discussion, KBW and J.P. Morgan each rendered to the People’s United board of directors their respective firms’ opinion, which in each case was initially rendered orally and confirmed by a written opinion dated February 20, 2021, to the effect

 

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that, as of that date and subject to the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken as set forth in each such opinion, the exchange ratio in the proposed merger was fair, from a financial point of view, to the holders of People’s United common stock. See “—Opinions of People’s United Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” and “—Opinions of People’s United Financial Advisors—Opinion of J.P. Morgan Securities LLC” beginning on pages 74 and 87, respectively. Following further discussion, during which the directors considered the matters reviewed and discussed at that meeting and all prior meetings, including the factors described under the section of this joint proxy statement/prospectus entitled “—People’s United’s Reasons for the Merger; Recommendation of the People’s United Board of Directors,” the People’s United board of directors unanimously determined that the merger agreement and the transactions contemplated by the merger agreement were advisable and fair to and in the best interests of Peoples’ United and its stockholders, and approved the merger agreement, the merger and the other transactions contemplated by the merger agreement and recommended that People’s United common stockholders adopt the merger agreement.

In the evening of February 21, 2021, M&T and People’s United executed the merger agreement. The transaction was announced in the morning of February 22, 2021, before the opening of the financial markets in New York, in a press release jointly issued by M&T and People’s United.

M&T’s Reasons for the Merger; Recommendation of M&T’s Board of Directors

After careful consideration, the M&T board of directors, via a unanimous written consent effective as of February 20, 2021, (i) determined that the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance) were advisable and fair to and in the best interests of M&T and its shareholders, (ii) approved and adopted the merger agreement and the transactions contemplated by the merger agreement (including the mergers, the M&T charter amendment and the M&T share issuance), and (iii) recommended the approval and adoption by M&T shareholders of the M&T charter amendment proposal, the M&T share issuance proposal and the other matters to be voted upon at the M&T special meeting in accordance with the merger agreement. In reaching this decision, the M&T board of directors evaluated the merger agreement, the mergers and the other matters contemplated by the merger agreement in consultation with M&T’s senior management, as well as with M&T’s legal and financial advisors, and considered a number of factors, including the following:

 

   

each of M&T’s and People’s United’s business, operations, financial condition, asset quality, earnings and prospects;

 

   

the strategic rationale for the merger, which will expand M&T’s banking markets to span the Northeast and Mid-Atlantic regions, which are among the most populated and attractive banking markets in the United States;

 

   

the complementary footprints of M&T and People’s United;

 

   

the expanded possibilities for growth that would be available to M&T, given its larger size, asset base, capital and footprint, including an increased presence in New England with an expanded suite of product offerings;

 

   

the compatibility of M&T’s and People’s United’s cultures and credit philosophies, including their shared commitment to local communities and the expectation that following the completion of the merger there will be an increase in M&T’s lending to low- to middle-income borrowers, small businesses and community developments, along with an increase in M&T’s direct philanthropy;

 

   

the complementary nature of the products, customers and markets of the two companies, which M&T believes should provide the opportunity to mitigate risks and increase potential returns;

 

   

the benefits and opportunities People’s United will bring to M&T, including significant small ticket and commercial equipment finance capabilities, access to over 71,000 retail customers People’s United serves and its extensive base of commercial customers;

 

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the anticipated pro forma financial impact of the merger on M&T, including potential tangible book value accretion, as well as positive impact on earnings, return on equity, asset quality, liquidity and regulatory capital levels;

 

   

the expectation of cost synergies resulting from the merger;

 

   

the expectation that the merger will offer potentially significant revenue synergies across multiple business lines and the fact that such revenue synergies were identified but not included in the financial analysis;

 

   

its review and discussions with M&T’s senior management concerning M&T’s due diligence examination of, among other areas, the operations, financial condition and regulatory compliance programs and prospects of People’s United;

 

   

its review with Lazard, M&T’s financial advisor, of the financial terms of the merger agreement and its review with M&T’s legal advisor of the other terms of the merger agreement, including the representations, covenants, deal protection and termination provisions;

 

   

the oral opinion of Lazard, subsequently confirmed in Lazard’s written opinion, to the effect that, as of the date of Lazard’s written opinion and subject to the various assumptions made, procedures followed, matters considered, and the qualifications and limitations on the scope of review undertaken by Lazard as set forth in its written opinion, the exchange ratio pursuant to the merger agreement was fair from a financial point of view to M&T, as more fully described below in the section “—Opinion of M&T’s Financial Advisor” beginning on page 62;

 

   

the fact that the exchange ratio would be fixed, which the M&T board of directors believed was consistent with market practice for transactions of this type and with the strategic purpose of the transaction;

 

   

its expectation that the required regulatory approvals could be obtained in a timely fashion;

 

   

the current and prospective environment in the financial services industry, including economic conditions and the interest rate and regulatory environments, the accelerating pace of technological change in the financial services industry, operating costs resulting from regulatory and compliance mandates, scale and marketing expenses, increasing competition from both banks and non-bank financial and financial technology firms, current financial market conditions, and the likely effects of these factors on M&T’s potential growth, development, productivity and strategic options both with and without the merger;

 

   

the fact that Mr. Jones would continue to serve as the Chairman and Chief Executive Officer of M&T and the governance structure for M&T following the completion of the merger, including the fact that five (5) People’s United directors will join the M&T’s board of directors upon the closing; and

 

   

M&T’s past records of integrating acquisitions and of realizing expected financial and other benefits of such acquisitions and the strength of M&T’s management and infrastructure to successfully complete the integration process.

The M&T board of directors also considered the potential risks related to the transaction. The board concluded that the anticipated benefits of combining with People’s United were likely to outweigh these risks substantially. These potential risks included:

 

   

the possibility that the anticipated benefits of the transaction will not be realized when expected or at all, including as a result of the impact of, or difficulties arising from, the integration of the two companies or as a result of the strength of the economy, general market conditions and competitive factors in the areas where M&T and People’s United operate businesses;

 

   

the costs to be incurred in connection with the merger and the integration of People’s United’s business into M&T and the possibility that the transaction and the integration may be more expensive to complete than anticipated, including as a result of unexpected factors or events;

 

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the possibility of encountering difficulties in achieving anticipated cost savings and synergies in the amounts currently estimated or within the time frame currently contemplated;

 

   

the possibility of encountering difficulties in successfully integrating the businesses, operations and workforces of M&T and People’s United;

 

   

the risk of losing key M&T or People’s United employees during the pendency of the merger and following the closing;

 

   

the possible diversion of management focus and resources from the operation of M&T’s business while working to implement the transaction and integrate the two companies;

 

   

the risk that, because the exchange ratio under the merger agreement would not be adjusted for changes in the market price of M&T common stock or People’s United common stock, the value of the shares of M&T common stock to be issued to People’s United stockholders upon the completion of the merger could be significantly more than the value of such shares immediately prior to the announcement of the parties’ entry into the merger agreement;

 

   

the risk that the regulatory and other approvals required in connection with the mergers may not be received in a timely manner or at all or may impose conditions that may adversely affect the anticipated operations, synergies and financial results of M&T following the completion of the merger;

 

   

the potential for legal claims challenging the merger; and

 

   

the other risks described under the sections entitled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements.”

The foregoing discussion of the information and factors considered by the M&T board of directors is not intended to be exhaustive, but includes the material factors considered by the board. In reaching its decision to approve the merger agreement and the transactions contemplated by the merger agreement, the M&T board of directors did not quantify or assign any relative weights to the factors considered, and individual directors may have given different weights to different factors. The board considered all these factors as a whole, including discussions with, and questioning of, M&T’s management and M&T’s independent financial and legal advisors, and overall considered the factors to support its determination.

For the reasons set forth above, the M&T board of directors determined that the merger agreement and the transactions contemplated thereby (including the mergers, the M&T charter amendment and the M&T share issuance) are advisable and fair to and in the best interests of M&T and its shareholders.

In considering the recommendation of the M&T board of directors, you should be aware that certain directors and executive officers of M&T may have interests in the merger that are different from, or in addition to, interests of M&T shareholders generally and may create potential conflicts of interest.

It should be noted that this explanation of the reasoning of the M&T board of directors and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” on page 29.

Opinion of M&T’s Financial Advisor

M&T retained Lazard as its financial advisor in connection with the transaction. In connection with this engagement, the M&T board of directors requested that Lazard evaluate the fairness, from a financial point of view, of the exchange ratio to M&T.

On February 19, 2021, Lazard rendered to the M&T board of directors its oral opinion, subsequently confirmed in a written opinion dated February 19, 2021, that, as of such date, and based upon and subject to the assumptions, procedures, matters, qualifications and limitations set forth therein, the exchange ratio was fair, from a financial point of view, to M&T.

 

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The full text of Lazard’s written opinion, dated February 19, 2021, which describes the assumptions made, procedures followed, matters considered and qualifications and limitations upon the review undertaken by Lazard in preparing its opinion, is attached as Annex D to this joint proxy statement/prospectus and is incorporated by reference into this joint proxy statement/prospectus. The summary of the written opinion of Lazard, dated February 19, 2021, set forth below is qualified in its entirety by the full text of Lazard’s written opinion attached as Annex D to this joint proxy statement/prospectus. Lazard’s financial advisory services and opinion were provided for the use and benefit of the M&T board of directors (in their capacity as directors and not in any other capacity) in connection with its evaluation of the transaction, and addressed only the fairness, from a financial point of view, as of the date thereof, of the exchange ratio to M&T. Lazard’s opinion is not intended to and does not constitute a recommendation to any M&T shareholder or any other person as to how such M&T shareholder or person should vote or act with respect to the merger or any matter relating thereto.

The full text of Lazard’s written opinion should be read carefully in its entirety for a description of the assumptions made, procedures followed, matters considered and qualifications and limitations upon the review undertaken by Lazard in preparing its opinion.

In connection with its opinion, Lazard:

 

   

reviewed the financial terms and conditions of a draft, dated February 15, 2021, of the merger agreement;

 

   

reviewed certain publicly available historical business and financial information relating to People’s United and M&T;

 

   

reviewed various financial forecasts and other data provided to Lazard by People’s United relating to the business of People’s United and extrapolations thereof prepared using assumptions as directed by M&T, financial forecasts and other data provided to Lazard by M&T relating to the business of People’s United, financial forecasts and other data provided to Lazard by M&T relating to the business of M&T and the projected synergies and other benefits, including the amount and timing thereof, anticipated by the management of M&T to be realized from the transaction;

 

   

held discussions with members of the senior managements of People’s United and M&T with respect to the businesses and prospects of People’s United and M&T, respectively, and with respect to the projected synergies and other benefits anticipated by the management of M&T to be realized from the transaction;

 

   

reviewed public information with respect to certain other companies in lines of business Lazard believed to be generally relevant in evaluating the businesses of People’s United and M&T, respectively;

 

   

reviewed the financial terms of certain business combinations involving companies in lines of business Lazard believes to be generally relevant in evaluating the business of People’s United;

 

   

reviewed historical stock prices and trading volumes of People’s United’s common stock and M&T’s common stock;

 

   

reviewed the potential pro forma financial impact of the transaction on M&T based on the financial forecasts referred to above relating to People’s United and M&T, and the synergies and other benefits anticipated by the management of M&T to be realized from the transaction; and

 

   

conducted such other financial studies, analyses and investigations as Lazard deemed appropriate.

Lazard assumed and relied upon the accuracy and completeness of the foregoing information, without independent verification of such information. Lazard did not conduct any independent valuation or appraisal of any of the assets or liabilities (contingent or otherwise) of People’s United, M&T, People’s United Bank or M&T

 

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Bank or concerning the solvency or fair value of People’s United, M&T, People’s United Bank or M&T Bank, and Lazard was not furnished with any such valuation or appraisal. With respect to the financial forecasts utilized in Lazard’s analyses, including those related to projected synergies and other benefits anticipated by the management of M&T to be realized from the transaction, Lazard assumed, with the consent of M&T, that they were reasonably prepared on bases reflecting the best currently available estimates and judgments as to the future financial performance of People’s United and M&T, respectively, and such synergies and other benefits. In addition, Lazard assumed, with the consent of M&T, that such financial forecasts and projected synergies and other benefits will be realized in the amounts and at the times contemplated thereby. Lazard assumed no responsibility for and expressed no view as to any such forecasts or the assumptions on which they were based, including with respect to the potential effects of the COVID-19 pandemic on such forecasts or assumptions.

Further, Lazard’s opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Lazard as of, the date of its opinion. Lazard assumed no responsibility for updating or revising its opinion based on circumstances or events occurring after the date of its opinion. Lazard further noted that the volatility and disruption in the credit and financial markets relating to, among other things, the COVID-19 pandemic, may or may not have an effect on M&T, People’s United, M&T Bank or People’s United Bank and that Lazard was not expressing an opinion as to the effects of such volatility or such disruption on any of them. Lazard did not express any opinion as to the prices at which shares of M&T’s common stock or People’s United’s common stock may trade at any time subsequent to the announcement of the transaction. Lazard’s opinion did not address the relative merits of the transaction as compared to any other transaction or business strategy in which M&T might engage or the merits of the underlying decision by M&T to engage in the transaction.

In rendering its opinion, Lazard assumed, with the consent of M&T, that the transaction would be consummated on the terms described in the merger agreement, without any waiver or modification of any material terms or conditions. Representatives of M&T advised Lazard, and Lazard assumed, that the merger agreement, when executed, would conform to the draft reviewed by Lazard in all material respects. Lazard also assumed, with the consent of M&T, that obtaining the necessary governmental, regulatory or third party approvals and consents for the transaction would not have an adverse effect on M&T, People’s United, M&T Bank, People’s United Bank or the transaction. Lazard further assumed, with the consent of M&T, that the merger and the holdco merger, taken together, would qualify for U.S. federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended. Lazard did not express any opinion as to any tax or other consequences that might result from the transaction, nor does its opinion address any legal, tax, regulatory or accounting matters, as to which Lazard understood that M&T obtained such advice as it deemed necessary from qualified professionals. Lazard noted that it is not an expert in the evaluation of allowance for loan losses, and Lazard neither made an independent evaluation of the adequacy of the allowance for loan losses at M&T Bank or People’s United Bank nor examined any individual loan credit files of M&T Bank or People’s United Bank, and, as a result, Lazard assumed, with the consent of M&T, that the aggregate allowances for loan losses of M&T Bank and People’s United Bank were adequate. Lazard expressed no view or opinion as to any terms or other aspects (other than the exchange ratio to the extent expressly specified in its opinion) of the transaction, including, without limitation, the form or structure of the transaction or any agreements or arrangements entered into in connection with, or contemplated by, the transaction, including with respect to the mergers. In addition, Lazard expressed no view or opinion as to the fairness of the amount or nature of, or any other aspects relating to, the compensation to any officers, directors or employees of any parties to the transaction, or class of such persons, relative to the exchange ratio or otherwise.

Summary of Lazard’s Financial Analyses

The following is a summary of the material financial analyses reviewed with the M&T board of directors in connection with Lazard’s opinion, dated as of February 19, 2021. The summary of Lazard’s analyses provided below is not a complete description of the analyses underlying Lazard’s opinion. The preparation of a fairness opinion is a complex process involving various determinations as to the most appropriate and relevant methods

 

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of analysis and the application of those methods to particular circumstances, and, therefore, is not readily susceptible to summary description.

In arriving at its opinion, Lazard considered the results of all of the analyses undertaken by it and assessed as a whole and did not draw, in isolation, conclusions from or with regard to any particular factor or analysis considered by it. Rather, Lazard made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of the analyses. Considering selected portions of the analyses in the summary set forth below, without considering the analyses as a whole, could create an incomplete or misleading view of the analyses underlying Lazard’s opinion.

For purposes of its analyses, Lazard considered industry performance, general business, economic, market and financial conditions, and other matters, many of which are beyond the control of M&T and People’s United. No company, business or transaction used in Lazard’s analyses as a comparison is identical to M&T, People’s United, the combined company or the transaction, and an evaluation of the results of those analyses is not entirely mathematical. Rather, Lazard’s analyses involve complex considerations and judgments concerning financial and operating characteristics and other factors that could affect the public trading or other values of the companies, businesses or transactions used in Lazard’s analyses. The estimates contained in Lazard’s analyses and the ranges of valuations resulting from any particular analysis are not necessarily indicative of actual values or predictive of future results or values, which may be significantly more or less favorable than those suggested by Lazard’s analyses. In addition, analyses relating to the value of companies, businesses or securities do not purport to be appraisals or to reflect the prices at which companies, businesses or securities actually may be sold. Accordingly, the estimates used in, and the results derived from, Lazard’s analyses are inherently subject to substantial uncertainty.

The summary of the analyses provided below includes information presented in tabular format. In order to fully understand Lazard’s analyses, the tables must be read together with the full text of the accompanying summary. The tables alone do not constitute a complete description of Lazard’s analyses. Considering the data in the tables below without considering the full description of the analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Lazard’s analyses.

Except as otherwise noted, the quantitative information used in the analyses, to the extent that it was based on market data, was based on market data as it existed at the close of the market on February 17, 2021, and is not necessarily indicative of current market conditions.

Public Trading Comparables Analysis

Lazard performed a public trading comparables analysis, which is designed to provide an implied trading value of a company by comparing it to selected companies with similar characteristics to the company. Lazard compared certain financial information of People’s United and M&T with publicly available information for the selected companies listed below, which are referred to, respectively, as the “People’s United selected companies” and the “M&T selected companies.” The People’s United selected companies and the M&T selected companies were chosen based on Lazard’s knowledge of the industry and because these companies have businesses that may be considered similar to People’s United and M&T, respectively. The People’s United selected companies consisted of all publicly traded banks headquartered in the Mid-Atlantic and Northeast regions with total assets between $20 billion and $100 billion, excluding announced merger targets. The M&T selected companies consisted of publicly traded United States banks with total assets between $75 billion and $600 billion and business models comparable, in Lazard’s professional judgment, to M&T.

With respect to the selected companies, the information Lazard presented included:

 

   

multiple of price to estimated earnings per share for 2021 and 2022, or Price / 2021E EPS and Price / 2022E EPS, respectively; and

 

   

multiple of price to tangible book value per share as of December 31, 2020, or Price / TBVPS

 

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In all instances, multiples were based on closing stock prices on February 17, 2021. For each of the following analyses performed by Lazard, financial and market data for the selected companies were based on the most recent publicly available information, including Wall Street research consensus estimates and information provided by S&P Global Market Intelligence.

The multiples calculated by Lazard for the People’s United selected companies are as follows:

 

     Price / 2021E EPS      Price / 2022E EPS      Price / TBVPS  

Signature Bank Corporation

     17.7x        15.8x        2.26x  

New York Community Bancorp, Inc.

     9.8x        8.9x        1.31x  

Valley National Bancorp

     11.2x        10.7x        1.67x  

F.N.B. Corporation

     11.7x        11.6x        1.44x  

Webster Financial Corporation

     13.8x        12.4x        1.81x  

Sterling Bancorp

     11.2x        9.6x        1.48x  

United Bankshares, Inc.

     14.9x        15.5x        1.86x  

Investors Bancorp, Inc.

     10.8x        9.7x        1.24x  

Fulton Financial Corporation

     12.9x        13.4x        1.30x  

Mean

     12.7x        11.9x        1.60x  

Median

     11.7x        11.6x        1.48x  

The multiples calculated by Lazard for the M&T selected companies are as follows:

 

     Price / 2021E EPS      Price / 2022E EPS      Price / TBVPS  

U.S. Bancorp

     13.0x        11.8x        2.03x  

Truist Financial Corporation

     14.4x        12.7x        2.12x  

PNC Financial Services Group, Inc.

     18.4x        14.3x        1.73x  

Fifth Third Bancorp

     11.8x        10.9x        1.44x  

Citizens Financial Group, Inc.

     11.5x        10.6x        1.31x  

KeyCorp

     10.7x        10.8x        1.45x  

Regions Financial Corporation

     10.8x        10.5x        1.72x  

Huntington Bancshares Incorporated

     12.0x        11.2x        1.77x  

Comerica Incorporated

     12.4x        13.2x        1.29x  

First Horizon Corporation

     11.6x        10.6x        1.56x  

Zions Bancorporation, National Association

     11.9x        12.6x        1.32x  

Mean

     12.6x        11.7x        1.61x  

Median

     11.9x        11.2x        1.56x  

Based on the analysis of the relevant metrics for each of the selected banks and its experience and professional judgment, Lazard selected a range of multiples and applied this range of multiples to the relevant financial statistics for People’s United and M&T, as applicable.

 

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For purposes of this analysis, with respect to People’s United, Lazard utilized estimated earnings per share for 2021 and 2022, as set forth in “—Certain Unaudited Prospective Financial Information—Certain Stand-Alone People’s United Prospective Financial Information Used by Lazard,” and tangible book value per share of People’s United as of December 31, 2020, as calculated by S&P Global Market Intelligence. Lazard estimated the implied trading value per share of People’s United common stock as of February 17, 2021, as follows:

 

     People’s United Metric      Multiple Statistic Range      Implied Value Per
Share of People’s United
Common Stock
 

Price / 2021E EPS

   $ 1.11        10.5x – 14.0x      $ 11.66 - $15.54  

Price / 2022E EPS

   $ 1.17        9.5x – 13.0x      $ 11.12 - $15.26  

Price / TBVPS

   $ 10.63        1.25x – 1.60x      $ 13.29 - $17.01  

Selected Range

     —          —        $ 12.00 - $17.00  

For purposes of this analysis, with respect to M&T, Lazard utilized estimated earnings per share for 2021 and 2022, as set forth in “—Certain Unaudited Prospective Financial Information—Certain Stand-Alone M&T Prospective Financial Information Used by Lazard,” and tangible book value per share of M&T as of December 31, 2020, as calculated by S&P Global Market Intelligence. Lazard estimated the implied trading value per share of M&T common stock as of February 17, 2021, as follows:

 

     M&T Metric      Multiple Statistic Range      Implied Value Per
Share of M&T
Common Stock
 

Price / 2021E EPS

   $ 11.54        11.0x – 12.5x      $ 126.94 - $144.25  

Price / 2022E EPS

   $ 12.25        10.0x – 12.0x      $ 122.50 - $147.00  

Price / TBVPS

   $ 80.49        1.60x – 2.00x      $ 128.78 - $160.98  

Selected Range

     —          —        $ 125.00 - $150.00  

Applying the foregoing analyses, Lazard then calculated the implied exchange ratio by dividing (i) the low end of the selected range of implied values per share of People’s United common stock of $12.00 by the high end of the selected range of implied values per share of M&T common stock of $150.00 and (ii) dividing the high end of the selected range of implied values per share of People’s United common stock of $17.00 by the low end of the selected range of implied values per share of M&T common stock of $125.00. This analysis indicated a range of implied exchange ratios from 0.0800x to 0.1360x, as compared to the transaction exchange ratio of 0.1180x.

No company in the public trading comparables analysis is identical to People’s United or M&T. In evaluating the People’s United selected companies and the M&T selected companies, Lazard made judgments and assumptions with regard to industry performance, general business, economic, market and financial conditions and other matters, many of which are beyond the control of People’s United or M&T, such as the impact of competition on the respective businesses of People’s United and M&T or the industry generally, industry growth and the absence of any material adverse change in the respective financial condition and prospects of People’s United or M&T or the industry or in the financial markets in general. Mathematical analysis, such as determining the average or median, is not in itself a meaningful method of using peer group data.

Selected Precedent Transactions Analysis

Lazard analyzed certain publicly available information relating to certain acquisition transactions (excluding mergers-of-equals) announced since January 1, 2015 involving target companies in the banking industry in the United States in which the implied transaction value was between $2 billion and $10 billion.

While none of the target companies in the selected transactions is directly comparable to People’s United and none of the selected transactions is directly comparable to the transaction, the target companies in the selected transactions are companies with certain operations that, for the purposes of analysis, may be considered similar to certain operations of People’s United and, as such, for purposes of the analysis, the selected transactions may be considered similar to the transaction.

 

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Using publicly available information, for each of the selected transactions, Lazard calculated:

 

   

multiple of price to tangible book value per share as of the last full fiscal quarter prior to the announcement of the applicable transaction, or Price / TBVPS; and

 

   

multiple of price to estimated earnings per share for the twelve (12) months following the last day for which the target company had reported financials prior to the announcement of the applicable transaction, or Price / NTM EPS

In each case, Lazard used publicly available information, including Wall Street research consensus estimates as of the last trading day prior to the announcement of the applicable transaction and information provided by S&P Global Market Intelligence. The selected transactions and the implied multiples calculated for the transactions are set forth below.

 

Announcement
Date

  

Acquiror

  

Target

   Price /
TBVPS
     Price / NTM
EPS
 

December 2020

   Huntington Bancshares Incorporated    TCF Financial Corporation      1.48x        14.4x  

June 2019

   Prosperity Bancshares, Inc.    LegacyTexas Financial Group, Inc.      2.16x        12.6x  

July 2018

   Synovus Financial Corp.    FCB Financial Holdings, Inc.      2.29x        15.0x  

May 2018

   Fifth Third Bancorp    MB Financial, Inc.      2.71x        18.4x  

May 2017

   First Horizon National Corporation    Capital Bank Financial Corp.      2.03x        20.7x  

March 2017

   Sterling Bancorp    Astoria Financial Corporation      1.59x        39.9x  

August 2016

   Teachers Insurance and Annuity Association    EverBank Financial Corp      1.47x        13.7x  

June 2016

   Canadian Imperial Bank of Commerce    PrivateBancorp, Inc.      2.06x        18.3x  

January 2016

   Huntington Bancshares Incorporated    FirstMerit Corporation      1.64x        14.6x  

October 2015

   KeyCorp    First Niagara Financial Group, Inc.      1.68x        19.0x  

January 2015

   Royal Bank of Canada    City National Corporation      2.55x        21.3x  

Mean

           1.97x        18.9x  

Median

           2.03x        18.3x  

Based on the analysis of the relevant metrics for each of the selected transactions and its experience and professional judgment, Lazard selected a range of multiples and applied this range of multiples to the relevant financial statistics for People’s United. For purposes of this analysis, Lazard utilized estimated earnings per share for the twelve months following the last day for which it had reported financials (December 31, 2020), as set forth in “—Certain Unaudited Prospective Financial Information—Certain Stand-Alone People’s United Prospective Financial Information Used by Lazard,” and tangible book value per share of People’s United as of December 31, 2020, as calculated by S&P Global Market Intelligence.

Lazard estimated the implied trading value per share of People’s United common stock as of February 17, 2021, as follows:

 

     People’s United Metric      Multiple Statistic Range      Implied Value Per
Share of People’s United
Common Stock
 

Price / NTM EPS

   $ 1.11        14.0x – 19.0x      $ 15.54 - $21.09  

Price / TBVPS

   $ 10.63        1.50x – 2.00x      $ 15.95 - $21.26  

Selected Range

     —          —        $ 16.00 - $21.00  

Applying the foregoing analysis, Lazard then calculated the implied exchange ratio by dividing (i) the low end of the selected range of implied values per share of People’s United common stock of $16.00 by the high end of the selected range of values per share of M&T common stock implied by the above public trading comparables

 

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analysis of $150.00 and (ii) the high end of the selected range of implied values per share of People’s United common stock of $21.00 by the low end of the selected range of values per share of M&T common stock implied by the above public trading comparables analysis of $125.00. This analysis indicated a range of implied exchange ratios from 0.1067x to 0.1680x, as compared to the transaction exchange ratio of 0.1180x.

Dividend Discount Analyses

Lazard performed a dividend discount analysis of shares of People’s United common stock and M&T common stock. A dividend discount analysis is a valuation methodology used to derive a valuation of an entity by adding the estimated dividends expected to be paid to shareholders through a specified forecast period, in this case, December 31, 2025, to the residual value of the entity at the end of the forecast period. This sum is then discounted to its “present value” using a range of selected discount rates. “Present value” refers to the current value of future cash flows or amounts and is obtained by discounting those future cash flows or amounts to a specified date, in this case, February 18, 2021, by a discount rate that takes into account macroeconomic assumptions and estimates of risk, the opportunity cost of capital, expected returns and other appropriate factors. In connection with this analysis, at M&T’s direction, Lazard assumed 100% of People’s United’s or M&T’s, as applicable, capital generation above a threshold tangible common equity to tangible assets ratio of 7.50% would be dividended on an annual basis and a 1.00% pre-tax opportunity cost of cash.

People’s United Standalone and Pro Forma Valuation

Using the People’s United stand-alone projections, Lazard performed dividend discount analyses for People’s United, both on a standalone basis as well as on a synergized basis taking into account the expected effects of the transaction based on M&T management’s adjustments described in further detail in “—Certain Unaudited Prospective Financial Information—Certain Estimated Synergies Attributable to the Merger”. At M&T’s direction, Lazard extrapolated the People’s United stand-alone projections through year-end 2026, assuming a 5% and 3% annual growth rate for net income and tangible assets, respectively. Lazard calculated a range of implied values per share of People’s United common stock based on the net present value of projected dividendable cash flows from March 31, 2021 through December 31, 2025.

Lazard based its analysis on a range of terminal forward multiples of 11.0x to 13.0x to the terminal year 2026 estimated earnings and 10.5% to 11.5% cost of equity. Lazard selected its terminal multiples and cost of equity ranges based on, among other things, an analysis of the same for the People’s United selected companies. Utilizing the range of costs of equity and terminal value multiples, Lazard derived an implied valuation range of present value indications per share of People’s United common stock from $12.64 to $14.76 on a standalone basis (the “People’s United Standalone DDM Range”) and $17.70 to $20.77 on a synergized basis taking into account the expected effects of the transaction (the “People’s United Pro Forma DDM Range”).

M&T Standalone Valuation

Using the M&T stand-alone projections, Lazard performed a dividend discount analysis for M&T on a standalone basis. Lazard calculated a range of implied values per share of M&T common stock based on the net present value of projected dividendable cash flows from March 31, 2021 through December 31, 2025.

Lazard based its analysis on a range of terminal forward multiples of 11.0x to 13.0x to the terminal year 2026 estimated earnings and 10.0% to 12.0% cost of equity. Lazard selected its terminal multiples and cost of equity ranges based on, among other things, an analysis of the same for the M&T selected companies. Utilizing the range of costs of equity and terminal value multiples, Lazard derived an implied valuation range of present value indications per share of M&T common stock from $125.92 to $151.44 on a standalone basis (the “M&T Standalone DDM Range”).

 

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Implied Exchange Ratio

Applying the foregoing analyses, Lazard calculated the implied exchange ratio with respect to People’s United on a standalone basis by dividing (i) the low end of the People’s United Standalone DDM Range of $12.64 by the high end of the M&T Standalone DDM Range of $151.44 and (ii) the high end of the People’s United Standalone DDM Range of $14.76 by the low end of the M&T Standalone DDM Range of $125.92. This analysis indicated a range of implied exchange ratios from 0.0835x to 0.1172x, as compared to the transaction exchange ratio of 0.1180x.

Lazard also calculated the implied exchange ratio with respect to People’s United on a synergized basis taking into account the expected effects of the transaction as described above by (i) dividing the low end of the People’s United Pro Forma DDM Range of $17.70 by the high end of the M&T Standalone DDM Range of $151.44 and (ii) dividing the high end of the People’s United Pro Forma DDM Range of $20.77 by the low end of the M&T Standalone DDM Range of $125.92. This analysis indicated a range of implied exchange ratios from 0.1168x to 0.1650x, as compared to the transaction exchange ratio of 0.1180x.

Other Analyses

The analyses and data described below were presented to the M&T board of directors for informational purposes only and did not provide the basis for the rendering of Lazard’s opinion.

People’s United Dividend Discount Analysis

Lazard performed an additional dividend discount analysis for People’s United on an alternative synergized basis taking into account the expected effects of the transaction. Lazard calculated a range of implied values per share of People’s United common stock based on the net present value of projected dividendable cash flows from March 31, 2021 through December 31, 2025.

Historical Trading Price Analysis

Lazard calculated the implied exchange ratio on each trading day during the one-year period ended February 17, 2021, by dividing the closing share price of People’s United common stock by the closing share price of M&T common stock.

Analyst Price Targets

Lazard reviewed publicly available equity research analyst stock price targets, which indicated target prices that ranged from $14.00 to $17.00 per share for People’s United common stock and $131.00 to $166.00 per share for M&T common stock.

General

In connection with Lazard’s services as financial advisor to M&T, M&T has agreed to pay Lazard an aggregate fee for such services of $20 million, $4 million of which became payable upon the rendering of Lazard’s opinion and the remainder of which is contingent upon the consummation of the transaction. M&T may also, in its sole discretion, pay Lazard up to an additional $3 million upon the consummation of the transaction. M&T also agreed to reimburse Lazard for certain expenses incurred in connection with Lazard’s engagement and to indemnify Lazard and certain related persons under certain circumstances against certain liabilities that may arise from or relate to Lazard’s engagement.

In the ordinary course, Lazard and its affiliates and employees may trade securities of People’s United, M&T and certain of their respective affiliates for their own accounts and for the accounts of their customers and,

 

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accordingly, may at any time hold a long or short position in such securities, and may also trade and hold securities on behalf of People’s United, M&T and certain of their respective affiliates. The issuance of Lazard’s opinion was approved by the Opinion Committee of Lazard.

Lazard did not recommend any specific exchange ratio or other consideration to M&T or that any given exchange ratio or other consideration constituted the only appropriate exchange ratio or other consideration for the transaction. Lazard’s opinion and analyses were only one of many factors taken into consideration by the M&T board of directors in its evaluation of the transaction. Consequently, the analyses described above should not be viewed as determinative of the views of the M&T board of directors or M&T management with respect to the exchange ratio provided for in the transaction or as to whether the M&T board of directors would have been willing to determine that a different exchange ratio or other consideration was fair.

Lazard is an internationally recognized investment banking firm providing a full range of financial advisory and securities services. Lazard was selected to act as M&T’s financial advisor because of its qualifications, experience and reputation in investment banking and mergers and its familiarity with M&T and its business.

People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors

After careful consideration, the People’s United board of directors, at a special meeting held on February 20, 2021, unanimously (i) determined that the merger agreement and the transactions contemplated thereby, including the merger, are in the best interests of People’s United and its stockholders, (ii) declared the merger agreement advisable and (iii) approved the execution, delivery and performance of the merger agreement and the consummation of the transactions contemplated thereby, including the merger. Accordingly, the People’s United board of directors unanimously recommends that the People’s United common stockholders vote “FOR” the People’s United merger proposal, “FOR” the People’s United compensation proposal and “FOR” the People’s United adjournment proposal.

In reaching its decision to approve the merger agreement and the transactions contemplated thereby, including the merger, and to recommend that People’s United’s common stockholders adopt the merger agreement, the People’s United board of directors evaluated the merger agreement, the merger and the other transactions contemplated by the merger agreement in consultation with People’s United management, as well as with People’s United’s financial and legal advisors, and considered a number of factors, including the following:

 

   

each of People’s United’s and M&T’s business, operations, financial condition, stock performance, asset quality, earnings and prospects. In reviewing these factors, including the information obtained through due diligence, the People’s United board of directors considered that M&T’s and People’s United’s respective business, operations and risk profile complement each other and that the companies’ separate earnings and prospects, and the synergies and scale potentially available in the proposed transaction, create the opportunity for the combined company to leverage complementary and diversified revenue streams and to have superior future earnings and prospects compared to People’s United’s earnings and prospects on a stand-alone basis;

 

   

the combined company’s position as the leading community-focused commercial bank in the Northeast and Mid-Atlantic regions, with the scale and share to compete effectively;

 

   

the fact that, upon the closing, the combined company’s board of directors would include five legacy People’s United directors, including Messrs. Barnes and Walters, which the People’s United board of directors believes enhances the likelihood that the strategic benefits People’s United expects to achieve as a result of the merger will be realized;

 

   

the fact that People’s United’s current headquarters in Bridgeport, Connecticut will become the New England regional headquarters for the combined company, which further strengthened the combined company’s commitment to Connecticut and the region;

 

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the fact that M&T intends to retain as many employees of People’s United as feasible in Connecticut and Vermont and remain one of the leading employers in Bridgeport, Connecticut;

 

   

the fact that, at or prior to the closing date, M&T will contribute $25,000,000 to a charitable foundation to support community development and reinvestment, and civic and charitable activities primarily in the greater Bridgeport, Connecticut area and such other areas as People’s United and M&T may mutually agree;

 

   

its knowledge of the current environment in the financial services industry, including economic conditions and the interest rate and regulatory environments, increased operating costs resulting from regulatory and compliance mandates, increasing competition from both banks and non-bank financial and financial technology firms, current financial market conditions and the likely effects of these factors on People’s United’s and the combined company’s potential growth, development, productivity and strategic options;

 

   

its views with respect to other strategic alternatives potentially available to People’s United, including continuing as a stand-alone company and a transformative transaction with another potential acquiror or merger partner, and its belief that a transaction with such other potential transaction partners would not deliver the financial and operational benefits that could be achieved in the proposed merger with M&T;

 

   

the exchange ratio in relation to the respective earnings contributions of People’s United and M&T;

 

   

the anticipated pro forma financial impact of the merger on the combined company, including earnings, earnings per share accretion, dividends, return on equity, tangible book value, asset quality, operational efficiency, liquidity and regulatory capital levels;

 

   

the complementary nature of People’s United’s and M&T’s businesses and prospects given the markets they serve and products they offer, and the expectation that the transaction would provide economies of scale, cost savings opportunities and enhanced opportunities for growth;

 

   

its belief that the two companies’ corporate cultures are similar and compatible, which would facilitate integration and implementation of the transaction;

 

   

People’s United’s and M&T’s shared views regarding the best approach to combining and integrating the two companies, structured to maximize the potential for synergies and positive impact to local communities and minimize the loss of customers and employees and to further diversify the combined company’s operating risk profile compared to the risk profile of either company on a stand-alone basis;

 

   

its review and discussions with People’s United’s management concerning People’s United’s due diligence examination of the operations, financial condition and regulatory compliance programs and prospects of M&T;

 

   

the expectation that the required regulatory approvals could be obtained in a timely fashion;

 

   

the expectation that the transaction will be generally tax-free for United States federal income tax purposes to People’s United’s stockholders;

 

   

the fact that the exchange ratio would be fixed, which the People’s United board of directors believed was consistent with market practice for transactions of this type and with the strategic purpose of the transaction;

 

   

its expectation that, upon consummation of the merger, People’s United common stockholders would own approximately 28% of the combined company on a fully diluted basis;

 

   

the fact that People’s United’s common stockholders will have an opportunity to vote on the approval of the merger agreement and the merger;

 

   

the impact of the merger on People’s United’s employees, including the compensation and employee benefits agreed to be provided by M&T pursuant to the merger agreement;

 

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the separate opinions of KBW and J.P. Morgan to the People’s United board, which were in each case dated February 20, 2021, as to the fairness, from a financial point of view, and as of the date of the opinions, to the holders of People’s United common stock of the exchange ratio in the proposed merger. See “—Opinions of People’s United Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” and “—Opinions of People’s United Financial Advisors—Opinion of J.P. Morgan Securities LLC” beginning on pages 74 and 87, respectively; and

 

   

the terms of the merger agreement, which People’s United reviewed with its legal advisor, including the representations, covenants, deal protection and termination provisions.

The People’s United board of directors also considered the potential risks related to the transaction, but concluded that the anticipated benefits of combining with M&T were likely to outweigh these risks. These potential risks include:

 

   

the possible diversion of management attention and resources from other strategic opportunities and operational matters while working to implement the transaction and integrate the two companies;

 

   

the risk of losing key People’s United employees during the pendency of the merger and thereafter;

 

   

the restrictions on the conduct of People’s United’s business during the period between execution of the merger agreement and the consummation of the merger, which could potentially delay or prevent People’s United from undertaking business opportunities that might arise or certain other actions it might otherwise take with respect to its operations absent the pendency of the merger;

 

   

the potential effect of the merger on People’s United’s overall business, including its relationships with customers, employees, suppliers and regulators;

 

   

the fact that People’s United’s stockholders would not be entitled to appraisal or dissenters’ rights in connection with the merger;

 

   

the possibility of encountering difficulties in achieving cost savings and synergies in the amounts currently estimated or within the time frame currently contemplated;

 

   

certain anticipated merger-related costs, which could also be higher than expected;

 

   

the regulatory and other approvals required in connection with the merger and the bank merger and the risk that such regulatory approvals will not be received or will not be received in a timely manner or may impose burdensome or unacceptable conditions;

 

   

the potential for legal claims challenging the merger;

 

   

the risk that the merger may not be completed despite the combined efforts of People’s United and M&T or that completion may be unduly delayed, including as a result of delays in obtaining the required regulatory approvals; and

 

   

the other risks described under the sections entitled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” beginning on pages 31 and 29, respectively.

The foregoing discussion of the information and factors considered by the People’s United board of directors is not intended to be exhaustive, but includes the material factors considered by the board. In reaching its decision to approve the merger agreement and the transactions contemplated thereby, including the merger, the People’s United board of directors did not quantify or assign any relative weights to the factors considered, and individual directors may have given different weights to different factors. The People’s United board of directors considered all these factors as a whole in evaluating the merger agreement and the transactions contemplated thereby, including the merger.

For the reasons set forth above, the People’s United board of directors determined that the merger agreement and the transactions contemplated by the merger agreement are advisable and fair to and in the best interests of People’s United and its stockholders, and approved the merger agreement and the transactions contemplated thereby, including the merger.

 

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In considering the recommendation of the People’s United board, you should be aware that certain directors and executive officers of People’s United may have interests in the merger that are different from, or in addition to, interests of stockholders of People’s United generally and may create potential conflicts of interest. The People’s United board of directors was aware of these interests and considered them when evaluating and negotiating the merger agreement and the transactions contemplated thereby, including the merger, and in recommending to People’s United’s common stockholders that they vote in favor of the People’s United merger proposal. See “—Interests of Certain People’s United Directors and Executive Officers in the Merger” beginning on page 100.

It should be noted that this explanation of the reasoning of the People’s United board of directors and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 29.

For the reasons set forth above, the People’s United board of directors unanimously recommends that the holders of People’s United common stock vote “FOR” the People’s United merger proposal and “FOR” the other proposals to be considered at the People’s United special meeting.

Opinions of People’s United’s Financial Advisors

Opinion of Keefe, Bruyette & Woods, Inc.

People’s United engaged KBW to render financial advisory and investment banking services to People’s United, including an opinion to the People’s United board of directors as to the fairness, from a financial point of view, to the common shareholders of People’s United of the exchange ratio in the proposed merger. People’s United selected KBW because KBW is a nationally recognized investment banking firm with substantial experience in transactions similar to the merger. As part of its investment banking business, KBW is continually engaged in the valuation of financial services businesses and their securities in connection with mergers and acquisitions.

As part of its engagement, representatives of KBW attended the meeting of the People’s United board of directors held on February 20, 2021, at which the People’s United board of directors evaluated the proposed transaction. At this meeting, KBW reviewed the financial aspects of the proposed merger and rendered to the People’s United board of directors an opinion to the effect that, as of such date and subject to the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by KBW as set forth in its opinion, the exchange ratio in the proposed merger was fair, from a financial point of view, to the holders of People’s United common stock. The People’s United board of directors approved the merger agreement at this meeting.

The description of the opinion set forth herein is qualified in its entirety by reference to the full text of the opinion, which is attached as Annex E to this document and is incorporated herein by reference, and describes the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by KBW in preparing the opinion.

KBW’s opinion speaks only as of the date of the opinion. The opinion was for the information of, and was directed to, the People’s United board of directors (in its capacity as such) in connection with its consideration of the financial terms of the transaction. The opinion addressed only the fairness, from a financial point of view, of the exchange ratio in the merger to the holders of People’s United common stock. It did not address the underlying business decision of People’s United to engage in the transaction or enter into the merger agreement or constitute a recommendation to the People’s United board of directors in connection with the transaction, and it does not constitute a recommendation to any holder of People’s United common stock or any shareholder of any other entity as to how to vote in connection with the transaction or any other matter, nor does it constitute a recommendation regarding whether or not any such shareholder should enter into a voting, shareholders’ or affiliates’ agreement with respect to the transaction or exercise any dissenters’ or appraisal rights that may be available to such shareholder.

 

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KBW’s opinion was reviewed and approved by KBW’s Fairness Opinion Committee in conformity with its policies and procedures established under the requirements of Rule 5150 of the Financial Industry Regulatory Authority.

In connection with the opinion, KBW reviewed, analyzed and relied upon material bearing upon the financial and operating condition of People’s United and M&T and bearing upon the transaction, including, among other things:

 

   

a draft of the merger agreement dated February 19, 2021 (the most recent draft then made available to KBW);

 

   

the audited financial statements and the Annual Reports on Form 10-K for the three fiscal years ended December 31, 2019 of People’s United;

 

   

the unaudited quarterly financial statements and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020 of People’s United;

 

   

certain unaudited financial results for the fiscal year and the quarter ended December 31, 2020 of People’s United (contained in the Current Report on Form 8-K filed by People’s United with the Securities and Exchange Commission on January 22, 2021);

 

   

the audited financial statements and Annual Reports on Form 10-K for the three fiscal years ended December 31, 2019 of M&T;

 

   

the unaudited quarterly financial statements and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020 of M&T;

 

   

certain unaudited financial results for the fiscal year and the quarter ended December 31, 2020 of M&T (contained in the Current Report on Form 8-K filed by M&T with the Securities and Exchange Commission on January 21, 2021);

 

   

certain regulatory filings of People’s United and M&T and their respective subsidiaries, including the quarterly reports on Form FR Y-9C and call reports filed with respect to each quarter during the three-year period ended December 31, 2020;

 

   

certain other interim reports and other communications of People’s United and M&T to their respective shareholders; and

 

   

other financial information concerning the businesses and operations of People’s United and M&T that was furnished to KBW by People’s United and M&T or that KBW was otherwise directed to use for purposes of KBW’s analyses.

KBW’s consideration of financial information and other factors that it deemed appropriate under the circumstances or relevant to its analyses included, among others, the following:

 

   

the historical and current financial position and results of operations of People’s United and M&T;

 

   

the assets and liabilities of People’s United and M&T;

 

   

the nature and terms of certain other merger transactions and business combinations in the banking industry;

 

   

a comparison of certain financial and stock market information for People’s United and M&T with similar information for certain other companies the securities of which were publicly traded;

 

   

publicly available consensus “street estimates” of People’s United, as well as assumed long-term People’s United growth rates provided to KBW by People’s United management, all of which information was discussed with KBW by People’s United management and used and relied upon by KBW at the direction of such management and with the consent of the People’s United board of directors;

 

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publicly available consensus “street estimates” of M&T, as well as certain assumed long-term M&T growth rates, all of which information was discussed with KBW by M&T management and used and relied upon by KBW based on such discussions, at the direction of People’s United management and with the consent of the People’s United board of directors; and

 

   

estimates regarding certain pro forma financial effects of the transaction on M&T (including, without limitation, the cost savings and related expenses expected to result or be derived from the transaction) that were prepared by, and provided to and discussed with KBW by, M&T management and that were used and relied upon by KBW based on such discussions, at the direction of People’s United management and with the consent of the People’s United board of directors.

KBW also performed such other studies and analyses as it considered appropriate and took into account its assessment of general economic, market and financial conditions and its experience in other transactions, as well as its experience in securities valuation and knowledge of the banking industry generally. KBW also participated in discussions held by the managements of People’s United and M&T regarding the past and current business operations, regulatory relations, financial condition and future prospects of their respective companies and such other matters as KBW deemed relevant to its inquiry. KBW was not requested to, and did not, assist People’s United with soliciting indications of interest from third parties regarding a potential transaction with People’s United.

In conducting its review and arriving at its opinion, KBW relied upon and assumed the accuracy and completeness of all of the financial and other information that was provided to it or that was publicly available and KBW did not independently verify the accuracy or completeness of any such information or assume any responsibility or liability for such verification, accuracy or completeness. KBW relied upon the management of People’s United as to the reasonableness and achievability of the publicly available consensus “street estimates” of People’s United and the assumed People’s United long-term growth rates referred to above (and the assumptions and bases therefor), and KBW assumed that all such information was reasonably prepared and represented, or in the case of the People’s United “street estimates” referred to above that such estimates were consistent with, the best currently available estimates and judgments of People’s United management and that the forecasts, projections and estimates reflected in such information would be realized in the amounts and in the time periods estimated. KBW further relied, with the consent of People’s United, upon M&T management as to the reasonableness and achievability of the publicly available consensus “street estimates” of M&T, the assumed M&T long-term growth rates, and the estimates regarding certain pro forma financial effects of the transaction on M&T (including, without limitation, the cost savings and related expenses expected to result or be derived from the transaction), all as referred to above (and the assumptions and bases for all such information), and KBW assumed that all such information was reasonably prepared and represented, or in the case of the M&T “street estimates” referred to above that such estimates were consistent with, the best currently available estimates and judgments of M&T management and that the forecasts, projections and estimates reflected in such information would be realized in the amounts and in the time periods estimated.

It is understood that the portion of the foregoing financial information of People’s United and M&T that was provided to KBW was not prepared with the expectation of public disclosure and that all of the foregoing financial information, including the publicly available consensus “street estimates” of People’s United and M&T, was based on numerous variables and assumptions that are inherently uncertain (including, without limitation, factors related to general economic and competitive conditions and, in particular, assumptions regarding the ongoing COVID-19 pandemic) and, accordingly, actual results could vary significantly from those set forth in such information. KBW assumed, based on discussions with the respective managements of People’s United and M&T and with the consent of the People’s United board of directors, that all such information provided a reasonable basis upon which KBW could form its opinion and KBW expressed no view as to any such information or the assumptions or bases therefor. Among other things, such information assumed that the ongoing COVID-19 pandemic could have an adverse impact, which has been assumed to be limited, on People’s United and M&T. KBW relied on all such information without independent verification or analysis and did not in any respect assume any responsibility or liability for the accuracy or completeness thereof.

 

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KBW also assumed that there were no material changes in the assets, liabilities, financial condition, results of operations, business or prospects of either People’s United or M&T since the date of the last financial statements of each such entity that were made available to KBW. KBW is not an expert in the independent verification of the adequacy of allowances for loan and lease losses and KBW assumed, without independent verification and with People’s United’s consent, that the aggregate allowances for loan and lease losses for People’s United and M&T are adequate to cover such losses. In rendering its opinion, KBW did not make or obtain any evaluations or appraisals or physical inspection of the property, assets or liabilities (contingent or otherwise) of People’s United or M&T, the collateral securing any of such assets or liabilities, or the collectability of any such assets, nor did KBW examine any individual loan or credit files, nor did it evaluate the solvency, financial capability or fair value of People’s United or M&T under any state or federal laws, including those relating to bankruptcy, insolvency or other matters. Estimates of values of companies and assets do not purport to be appraisals or necessarily reflect the prices at which companies or assets may actually be sold. Such estimates are inherently subject to uncertainty and should not be taken as KBW’s view of the actual value of any companies or assets.

KBW assumed, in all respects material to its analyses:

 

   

that the transaction and any related transactions (including, without limitation, the bank merger) would be completed substantially in accordance with the terms set forth in the merger agreement (the final terms of which KBW assumed would not differ in any respect material to KBW’s analyses from the draft reviewed by KBW and referred to above) with no adjustments to the exchange ratio and with no other consideration or payments in respect of People’s United common stock;

 

   

that the representations and warranties of each party in the merger agreement and in all related documents and instruments referred to in the merger agreement were true and correct;

 

   

that each party to the merger agreement and all related documents would perform all of the covenants and agreements required to be performed by such party under such documents;

 

   

that there were no factors that would delay or subject to any adverse conditions, any necessary regulatory or governmental approval for the transaction or any related transactions and that all conditions to the completion of the transaction and any related transactions would be satisfied without any waivers or modifications to the merger agreement or any of the related documents; and

 

   

that in the course of obtaining the necessary regulatory, contractual, or other consents or approvals for the transaction and any related transactions, no restrictions, including any divestiture requirements, termination or other payments or amendments or modifications, would be imposed that would have a material adverse effect on the future results of operations or financial condition of People’s United, M&T or the pro forma entity, or the contemplated benefits of the transaction, including without limitation the cost savings and related expenses expected to result or be derived from the transaction.

KBW assumed that the transaction would be consummated in a manner that complies with the applicable provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and all other applicable federal and state statutes, rules and regulations. KBW was further advised by representatives of People’s United that People’s United relied upon advice from its advisors (other than KBW) or other appropriate sources as to all legal, financial reporting, tax, accounting and regulatory matters with respect to People’s United, M&T, the transaction and any related transaction, and the merger agreement. KBW did not provide advice with respect to any such matters.

KBW’s opinion addressed only the fairness, from a financial point of view, as of the date of the opinion, of the exchange ratio in the merger to the holders of People’s United common stock. KBW expressed no view or opinion as to any other terms or aspects of the transaction or any term or aspect of any related transaction (including the bank merger and the termination of People’s United’s Employee Stock Ownership Plan prior to the consummation of the merger), including without limitation, the form or structure of the transaction or any such related transaction, the treatment of outstanding preferred stock and other securities of People’s United in

 

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the transaction, any consequences of the transaction or any such related transaction to People’s United, its shareholders, creditors or otherwise, or any terms, aspects, merits or implications of any employment, consulting, voting, support, shareholder, charitable giving or other agreements, arrangements or understandings contemplated or entered into in connection with the transaction, any such related transaction, or otherwise. KBW’s opinion was necessarily based upon conditions as they existed and could be evaluated on the date of such opinion and the information made available to KBW through such date. There has been widespread disruption, extraordinary uncertainty and unusual volatility arising from the effects of the COVID-19 pandemic, including the effect of evolving governmental interventions and non-interventions. Developments subsequent to the date of KBW’s opinion may have affected, and may affect, the conclusion reached in KBW’s opinion and KBW did not and does not have an obligation to update, revise or reaffirm its opinion. KBW’s opinion did not address, and KBW expressed no view or opinion with respect to:

 

   

the underlying business decision of People’s United to engage in the transaction or enter into the merger agreement;

 

   

the relative merits of the transaction as compared to any strategic alternatives that are, have been or may be available to or contemplated by People’s United or the People’s United board of directors;

 

   

the fairness of the amount or nature of any compensation to any of People’s United’s officers, directors or employees, or any class of such persons, relative to the compensation to the holders of People’s United common stock;

 

   

the effect of the transaction or any related transaction on, or the fairness of the consideration to be received by, holders of any class of securities of People’s United (other than the holders of People’s United common stock, solely with respect to the exchange ratio as described in KBW’s opinion and not relative to the consideration to be received by holders of any other class of securities) or holders of any class of securities of M&T or any other party to any transaction contemplated by the merger agreement;

 

   

the actual value of M&T common stock to be issued in the merger;

 

   

the prices, trading range or volume at which People’s United common stock or M&T common stock would trade following the public announcement of the transaction or the prices, trading range or volume at which M&T common stock would trade following the consummation of the transaction;

 

   

any advice or opinions provided by any other advisor to any of the parties to the transaction or any other transaction contemplated by the merger agreement; or

 

   

any legal, regulatory, accounting, tax or similar matters relating to People’s United, M&T, their respective shareholders, or relating to or arising out of or as a consequence of the transaction or any related transaction (including the bank merger), including whether or not the transaction would qualify as a tax-free reorganization for United States federal income tax purposes.

In performing its analyses, KBW made numerous assumptions with respect to industry performance, general business, economic, market and financial conditions and other matters, which are beyond the control of KBW, People’s United and M&T. Any estimates contained in the analyses performed by KBW are not necessarily indicative of actual values or future results, which may be significantly more or less favorable than suggested by these analyses. Additionally, estimates of the value of businesses or securities do not purport to be appraisals or to reflect the prices at which such businesses or securities might actually be sold. Accordingly, these analyses and estimates are inherently subject to substantial uncertainty. In addition, KBW’s opinion was among several factors taken into consideration by the People’s United board of directors in making its determination to approve the merger agreement and the transaction. Consequently, the analyses described below should not be viewed as determinative of the decision of the People’s United board of directors with respect to the fairness of the exchange ratio. The type and amount of consideration payable in the merger were determined through negotiation between People’s United and M&T and the decision of People’s United to enter into the merger agreement was solely that of the People’s United board of directors.

 

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The following is a summary of the material financial analyses presented by KBW to the People’s United board of directors in connection with its opinion. The summary is not a complete description of the financial analyses underlying the opinion or the presentation made by KBW to the People’s United board of directors, but summarizes the material analyses performed and presented in connection with such opinion. The financial analyses summarized below include information presented in tabular format. The tables alone do not constitute a complete description of the financial analyses. The preparation of a fairness opinion is a complex analytic process involving various determinations as to appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances. Therefore, a fairness opinion is not readily susceptible to partial analysis or summary description. In arriving at its opinion, KBW did not attribute any particular weight to any analysis or factor that it considered, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Accordingly, KBW believes that its analyses and the summary of its analyses must be considered as a whole and that selecting portions of its analyses and factors or focusing on the information presented below in tabular format, without considering all analyses and factors or the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the process underlying its analyses and opinion.

For purposes of the financial analyses described below, KBW utilized an implied transaction value for the merger of $17.70 per outstanding share of People’s United common stock, or approximately $7,518.6 million in the aggregate (inclusive of the implied value of in-the-money People’s United stock options), based on the 0.1180x exchange ratio in the proposed merger and the closing price of M&T common stock on February 19, 2021. In addition to the financial analyses described below, KBW reviewed with the People’s United board of directors for informational purposes, among other things, an implied transaction multiple for the proposed merger (based on the implied transaction value for the merger of $17.70 per outstanding share of People’s United common stock) of 13.8x People’s United’s estimated calendar year 2021 earnings per share (“EPS”) taken from publicly available consensus “street estimates” for People’s United.

People’s United Selected Companies Analysis

Using publicly available information, KBW compared the financial performance, financial condition and market performance of People’s United to M&T and 11 major exchange-traded U.S. banks with total assets between $40 billion and $100 billion. Merger targets, Puerto Rico-headquartered banks and First Citizens BancShares, Inc. were excluded from the selected companies.

The selected companies were as follows:

BOK Financial Corporation

Comerica Incorporated

Cullen/Frost Bankers, Inc.

East West Bancorp, Inc.

First Horizon Corporation

New York Community Bancorp, Inc.

Signature Bank

Synovus Financial Corp.

Valley National Bancorp

Wintrust Financial Corporation

Zions Bancorporation, National Association

To perform this analysis, KBW used profitability and other financial information for the latest 12 months (“LTM”) (or, in the case of dividend yield, most recent completed fiscal quarter annualized) available or as of the end of such period and market price information as of February 19, 2021. KBW also used 2021 and 2022 EPS estimates taken from publicly available consensus “street estimates” for People’s United, M&T and the selected companies. Certain financial data prepared by KBW, and as referenced in the tables presented below, may not

 

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correspond to the data presented in People’s United’s historical financial statements, or the data prepared by Lazard Frères & Co. LLC and J.P. Morgan Securities LLC presented under the sections “Opinion of M&T’s Financial Advisor” and “Opinions of People’s United’s Financial Advisors—Opinion of J.P. Morgan Securities LLC”, respectively, as a result of the different periods, assumptions and methods used by KBW to compute the financial data presented.

KBW’s analysis showed the following concerning the financial performance of People’s United, M&T and the selected companies:

 

           Selected Companies  
     People’s
United
    M&T     25th
Percentile
    Median     Average     75th
Percentile
 

LTM Core Return on Average Assets(1)

     0.95     1.01     0.74     0.88     0.84     0.92

LTM Core Return on Average Equity(1)

     7.42     8.54     7.43     7.89     8.33     9.07

LTM Core Return on Average Tangible Common Equity(1)

     13.42     12.75     8.99     10.90     10.60     12.73

LTM Core Pre-Tax Pre-Provision Return on Average Assets(2)

     1.47     1.93     1.51     1.63     1.58     1.69

LTM Net Interest Margin

     2.99     3.16     2.64     2.86     2.82     3.04

LTM Fee Income / Revenue Ratio

     20.8     35.2     14.0     21.8     23.4     35.5

LTM Efficiency Ratio

     55.6     56.3     59.3     57.9     53.4     46.2

 

(1)

Core income excluded extraordinary items, non-recurring items, gains/losses on sale of securities and amortization of intangibles as calculated by S&P Global Market Intelligence.

(2)

Income before taxes excluding provision for loan losses and extraordinary items, excluding gain on the sale of available for sale securities, amortization of intangibles, goodwill and nonrecurring items.

KBW’s analysis showed the following concerning the financial condition of People’s United and the selected companies:

 

           Selected Companies  
     People’s
United
    M&T     25th
Percentile
    Median     Average     75th
Percentile
 

Tangible Common Equity / Tangible Assets

     7.49     7.49     7.08     7.66     7.77     8.19

Common Equity Tier 1 (CET1) Ratio

     10.50     10.00     9.70     9.94     10.57     11.35

Total Capital Ratio

     12.40     13.37     12.81     13.43     13.50     13.94

Loans / Deposits

     84.1     82.3     74.3     81.9     82.7     86.0

Allowance for Credit Losses / Loans

     0.97     1.76     1.14     1.56     1.43     1.75

Nonperforming Assets / Loans + OREO(1)

     1.04     2.19     0.98     0.77     0.80     0.64

LTM Net Charge-offs / Average Loans

     0.11     0.26     0.28     0.20     0.23     0.12

 

(1)

NPAs included nonaccrual loans, accruing troubled debt restructured loans, loans 90+ days past due, and other real estate owned as defined by S&P Global Market Intelligence.

 

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In addition, KBW’s analysis showed the following concerning the market performance of People’s United and the selected companies:

 

           Selected Companies  
     People’s
United
    M&T     25th
Percentile
    Median     Average     75th
Percentile
 

One-Year Stock Price Change

     (2.6 %)      (10.9 %)      5.9     11.5     16.0     14.9

Year-To-Date Stock Price Change

     21.3     17.8     19.0     23.9     26.0     29.5

Price / Tangible Book Value per Share

     1.46x       1.86x       1.36x       1.51x       1.62x       1.77x  

Price / 2021 EPS Estimate

     12.2x       12.4x       11.8x       12.1x       13.5x       13.8x  

Price / 2022 EPS Estimate

     12.1x       12.5x       10.9x       12.8x       13.2x       13.6x  

Dividend Yield

     4.6     2.9     2.2     2.8     3.0     3.6

2021 Dividend Payout Ratio

     56.1     36.4     28.2     36.5     38.3     48.3

No company used as a comparison in the above selected companies analysis is identical to People’s United. Accordingly, an analysis of these results is not mathematical. Rather, it involves complex considerations and judgments concerning differences in financial and operating characteristics of the companies involved.

M&T Selected Companies Analysis

Using publicly available information, KBW compared the financial performance, financial condition and market performance of M&T to 11 selected major exchange-traded U.S. banks with total assets between $75 billion and $600 billion. Merger targets, trust and custody banks (specifically, Bank of New York Mellon Corporation, State Street Corporation, and Northern Trust Corporation) and banks with unique business models (specifically, Capital One Financial Corporation, First Republic Bank and SVB Financial Group) were excluded from the selected companies.

The selected companies were as follows:

 

Citizens Financial Group, Inc.

   Regions Financial Corporation

Comerica Incorporated

   Truist Financial Corporation

Fifth Third Bancorp

   U.S. Bancorp

First Horizon Corporation

   Zions Bancorporation, National Association

Huntington Bancshares Incorporated

  

KeyCorp

  

PNC Financial Services Group, Inc.

  

To perform this analysis, KBW used profitability and other financial information for the latest 12 months (or, in the case of dividend yield, most recent completed fiscal quarter annualized) available or as of the end of such period and market price information as of February 19, 2021. KBW also used 2021 and 2022 EPS estimates taken from publicly available consensus “street estimates” for M&T and the selected companies. Certain financial data prepared by KBW, and as referenced in the tables presented below, may not correspond to the data presented in M&T’s historical financial statements, or the data prepared by Lazard Frères & Co. LLC and J.P. Morgan Securities LLC presented under the sections “Opinion of M&T’s Financial Advisor” and “Opinions of People’s United’s Financial Advisors—Opinion of J.P. Morgan Securities LLC”, respectively, as a result of the different periods, assumptions and methods used by KBW to compute the financial data presented.

 

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KBW’s analysis showed the following concerning the financial performance of M&T and the selected companies:

 

           Selected Companies  
     M&T     25th
Percentile
    Median     Average     75th
Percentile
 

LTM Core Return on Average Assets(1)

     1.01     0.70     0.79     0.80     0.87

LTM Core Return on Average Equity(1)

     8.54     6.29     6.98     7.26     8.14

LTM Core Return on Average Tangible Common Equity(1)

     12.75     8.73     9.98     10.52     11.88

LTM Core Pre-Tax Pre-Provision Return on Average Assets(2)

     1.93     1.53     1.72     1.69     1.85

LTM Net Interest Margin

     3.16     2.72     2.86     2.87     3.07

LTM Fee Income / Revenue Ratio

     35.2     33.9     36.6     35.8     38.8

LTM Efficiency Ratio

     56.3     59.8     57.9     58.3     56.5

 

(1)

Core income excluded extraordinary items, non-recurring items, gains/losses on sale of securities and amortization of intangibles as calculated by S&P Global Market Intelligence.

(2)

Income before taxes excluding provision for loan losses and extraordinary items, excluding gain on the sale of available for sale securities, amortization of intangibles, goodwill and nonrecurring items.

KBW’s analysis also showed the following concerning the financial condition of M&T and the selected companies:

 

           Selected Companies  
     M&T     25th
Percentile
    Median     Average     75th
Percentile
 

Tangible Common Equity / Tangible Assets

     7.49     7.22     7.84     7.70     7.96

Common Equity Tier 1 (CET1) Ratio

     10.00     9.80     10.00     10.23     10.34

Total Capital Ratio

     13.37     13.40     13.60     13.93     14.48

Loans / Deposits

     82.3     69.4     74.8     75.0     80.6

Allowance for Credit Losses / Loans

     1.76     1.85     2.17     2.17     2.43

Nonperforming Assets / Loans + OREO(1)

     2.19     1.40     1.13     1.18     1.04

LTM Net Charge-offs / Average Loans

     0.26     0.55     0.41     0.42     0.34

 

(1)

NPAs included nonaccrual loans, accruing troubled debt restructured loans, loans 90+ days past due, and other real estate owned as defined by S&P Global Market Intelligence.

In addition, KBW’s analysis showed the following concerning the market performance of M&T and the selected companies:

 

           Selected Companies  
     M&T     25th
Percentile
    Median     Average     75th
Percentile
 

One-Year Stock Price Change

     (10.9 %)      4.3     9.1     8.4     12.0

Year-To-Date Stock Price Change

     17.8     18.9     20.1     20.3     24.0

Price / Tangible Book Value per Share

     1.86x       1.41x       1.60x       1.65x       1.78x  

Price / 2021 EPS Estimate

     12.4x       11.6x       12.4x       13.0x       13.1x  

Price / 2022 EPS Estimate

     12.5x       10.9x       11.5x       12.0x       12.8x  

Dividend Yield

     2.9     3.1     3.4     3.4     3.7

2021 Dividend Payout Ratio

     36.4     39.8     43.6     43.3     48.5

No company used as a comparison in the above selected companies analysis is identical to M&T. Accordingly, an analysis of these results is not mathematical. Rather, it involves complex considerations and judgments concerning differences in financial and operating characteristics of the companies involved.

 

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Selected Transactions Analysis

KBW reviewed publicly available information related to 10 selected U.S. bank transactions announced since January 1, 2018 with announced deal values greater than $2 billion.

The selected transactions were as follows:

 

Acquiror

  

Acquired Company

Huntington Bancshares Incorporated

   TCF Financial Corporation

PNC Financial Services Group, Inc.

   BBVA USA Bancshares, Inc.

First Citizens BancShares, Inc.

   CIT Group Inc.

South State Corporation

First Horizon National Corporation

Prosperity Bancshares, Inc.

BB&T Corporation

Chemical Financial Corporation

Synovus Financial Corp.

Fifth Third Bancorp

  

CenterState Bank Corporation

IBERIABANK Corporation

LegacyTexas Financial Group, Inc.

SunTrust Banks, Inc.

TCF Financial Corporation

FCB Financial Holdings, Inc.

MB Financial, Inc.

For each selected transaction, KBW derived the following implied transaction statistics, in each case based on the transaction consideration value paid for the acquired company and using financial data based on the acquired company’s then latest publicly available financial statements prior to the announcement of the respective transaction and, to the extent publicly available, one year forward estimated EPS prior to the announcement of the respective transaction:

 

   

Price per common share to tangible book value per share of the acquired company (in the case of one selected transaction involving a private acquired company, this transaction statistic was calculated as total transaction consideration divided by total tangible common equity);

 

   

Price per common share to estimated EPS of the acquired company for the first full year after the announcement of the respective transaction, referred to as Forward EPS, in the nine selected transactions in which consensus “street estimates” for the acquired company were available at announcement; and

 

   

Tangible equity premium to core deposits (total deposits less time deposits greater than $100,000) of the acquired company, referred to as core deposit premium

KBW also reviewed the ratio of the implied tangible book value multiple for each selected transaction to the acquiror’s standalone tangible book value multiple based on the acquiror’s then latest closing stock price and then latest publicly available financial statements prior to the announcement of the respective transaction and, in the case of eight selected transactions in which consensus “street estimates” for the acquired company and the acquiror were available at announcement, the ratio of the implied Forward EPS multiple for each selected transaction to the acquiror’s standalone Forward EPS multiple based on the acquiror’s then latest closing stock price prior to the announcement of the respective transaction (referred to as the pay to trade ratios). KBW also reviewed the price per common share paid for the acquired company for the nine selected transactions involving publicly traded acquired companies as a premium/(discount) to the closing stock price of the acquired company one day prior to the announcement of the acquisition (expressed as a percentage and referred to as the one day market premium). The resulting transaction statistics for the selected transactions were compared with the corresponding transaction statistics for the proposed merger based on the implied transaction value for the merger of $17.70 per outstanding share of People’s United common stock and using historical financial information for People’s United and M&T as of December 31, 2020, People’s United’s and M&T’s estimated calendar year 2022 EPS taken from publicly available consensus “street estimates” for People’s United and M&T and the closing prices of People’s United common stock and M&T common stock on February 19, 2021.

 

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The results of the analysis are set forth in the following table:

 

           Selected Transactions  
     M&T / People’s
United
    25th
Percentile
    Median     Average     75th
Percentile
 

Price / Tangible Book Value per Share

     1.64x       1.43x       1.69x       1.72x       2.12x  

Price / Forward EPS

     13.7x       10.8x       12.2x       12.2x       13.5x  

Pay to Trade Ratio based on Tangible Book Value per Share)

     0.88x       0.86x       0.93x       0.93x       0.99x  

Pay to Trade Ratio (based on Forward EPS)

     1.10x       0.95x       0.98x       1.02x       1.10x  

Core Deposit Premium

     6.1     5.3     8.1     10.0     18.9

One-Day Market Premium

     12.9     0.0     9.3     7.9     11.0

No company or transaction used as a comparison in the above selected transaction analysis is identical to People’s United, M&T or the proposed merger. Accordingly, an analysis of these results is not mathematical. Rather, it involves complex considerations and judgments concerning differences in financial and operating characteristics of the companies involved.

Relative Contribution Analysis

KBW analyzed the relative standalone contribution of M&T and People’s United to various pro forma balance sheet and income statement items and the combined market capitalization of the combined entity. This analysis did not include purchase accounting adjustments or cost savings. To perform this analysis, KBW used (i) balance sheet data for M&T and People’s United as of December 31, 2020, (ii) income statement data for M&T and People’s United for the fiscal year ended December 31, 2020, (iii) publicly available consensus “street estimates” for M&T and People’s United, and (iv) market price information as of February 19, 2021. The results of KBW’s analysis are set forth in the following table, which also compares the results of KBW’s analysis with the implied pro forma ownership percentages of M&T and People’s United shareholders in the combined company based on the 0.1180x exchange ratio provided for in the merger agreement:

 

     M&T
% of Total
    People’s United
% of Total
 

Ownership at 0.1180x merger exchange ratio:

     72     28

Market Information:

    

Pre-Transaction Market Capitalization

     75     25

Balance Sheet:

    

Assets

     69     31

Total Gross Loans

     69     31

Deposits

     70     30

Tangible Common Equity

     70     30

Income Statement:

    

2020 Pre-tax, Pre-Provision Earnings

     76     24

2021 Earnings

     74     26

2022 Earnings

     73     27

Financial Impact Analysis

KBW performed a pro forma financial impact analysis that combined projected income statement and balance sheet information of M&T and People’s United. Using (i) closing balance sheet estimates as of September 30, 2021 for M&T and People’s United taken from publicly available consensus “street estimates”, (ii) publicly available calendar year 2021 and 2022 EPS consensus “street estimates” for M&T and an assumed long-term growth rate as discussed with M&T management, (iii) publicly available calendar year 2021 and 2022 EPS consensus “street estimates” for People’s United and an assumed long-term growth rate provided by People’s

 

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United management and (iv) pro forma assumptions (including, without limitation, the cost savings and related expenses expected to result from the merger and certain purchase accounting and other merger-related adjustments and restructuring charges assumed with respect thereto) provided by M&T management, KBW analyzed the potential financial impact of the merger on certain projected financial results of M&T. This analysis indicated the merger could be accretive to M&T’s estimated 2022 and 2023 EPS and M&T’s estimated tangible book value per share at closing as of September 30, 2021. Furthermore, the analysis indicated that, pro forma for the merger, each of M&T’s tangible common equity to tangible assets ratio, Leverage Ratio, Common Equity Tier 1 (CET1) Ratio, Tier 1 Capital Ratio and Total Risk-based Capital Ratio at closing as of September 30, 2021 could be lower. For all of the above analysis, the actual results achieved by M&T following the merger may vary from the projected results, and the variations may be material.

People’s United Dividend Discount Model Analysis

KBW performed a dividend discount model analysis of People’s United to estimate a range for the implied equity value of People’s United. In this analysis, KBW used publicly available consensus “street estimates” for People’s United and assumed long-term growth rates for People’s United provided by People’s United management, and assumed discount rates ranging from 10.0% to 12.0%. The range of values was derived by adding (i) the present value of implied future excess capital available for dividends that People’s United could generate over the period from September 30, 2021 through December 31, 2026 as a standalone company, and (ii) the present value of People’s United’s implied terminal value at the end of such period. KBW assumed that People’s United would maintain a tangible common equity to tangible assets ratio of 7.50% and would retain sufficient earnings to maintain that level. In calculating implied terminal values for People’s United, KBW applied a range of 11.0x to 13.0x to People’s United’s estimated 2026 earnings. This dividend discount model analysis resulted in a range of implied values per share of People’s United common stock of $15.01 to $17.95.

The dividend discount model analysis is a widely used valuation methodology, but the results of such methodology are highly dependent on the assumptions that must be made, including asset and earnings growth rates, terminal values and discount rates. The foregoing dividend discount model analysis did not purport to be indicative of the actual values or expected values of People’s United.

M&T Dividend Discount Model Analysis

KBW performed a dividend discount model analysis of M&T to estimate a range for the implied equity value of M&T. In this analysis, KBW used publicly available consensus “street estimates” for M&T and assumed long-term growth rates for M&T as discussed with M&T management, and assumed discount rates ranging from 10.0% to 12.0%. The range of values was derived by adding (i) the present value of implied future excess capital available for dividends that M&T could generate over the period from September 30, 2021 through December 31, 2026 as a standalone company, and (ii) the present value of M&T’s implied terminal value at the end of such period. KBW assumed that M&T would maintain a tangible common equity to tangible assets ratio of 7.50% and would retain sufficient earnings to maintain that level. In calculating implied terminal values for M&T, KBW applied a range of 11.0x to 13.0x to M&T’s estimated 2026 earnings. This dividend discount model analysis resulted in a range of implied values per share of M&T common stock of $127.70 to $153.31.

The dividend discount model analysis is a widely used valuation methodology, but the results of such methodology are highly dependent on the assumptions that must be made, including asset and earnings growth rates, terminal values and discount rates. The foregoing dividend discount model analysis did not purport to be indicative of the actual values or expected values of M&T or the pro forma combined entity.

Pro Forma Dividend Discount Model Analysis

KBW performed a dividend discount model analysis to estimate a range for the implied equity value of the pro forma combined entity, taking into account the cost savings and related expenses expected to result from the

 

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merger as well as certain purchase accounting and other merger-related adjustments and restructuring charges assumed with respect thereto. In this analysis, KBW used publicly available consensus “street estimates” for M&T and People’s United, assumed long-term growth rates for M&T as discussed with M&T management and assumed long-term growth rates for People’s United as discussed with M&T management and provided by People’s United management and estimated cost savings and related expenses, purchase accounting and other merger-related adjustments and restructuring charges provided by M&T management, and KBW assumed discount rates ranging from 10.0% to 12.0%. The range of values was derived by adding (i) the present value of implied future excess capital available for dividends that the pro forma combined entity could generate over the period from September 30, 2021 through December 31, 2026, and (ii) the present value of the pro forma combined entity’s implied terminal value at the end of such period, in each case applying estimated cost savings and related expenses, purchase accounting and other merger-related adjustments and restructuring charges. KBW assumed that the pro forma combined entity would maintain a tangible common equity to tangible assets ratio of 7.50% and would retain sufficient earnings to maintain that level. In calculating implied terminal values for the pro forma combined entity, KBW applied a range of 11.0x to 13.0x to the pro forma combined entity’s estimated 2026 earnings. This dividend discount model analysis resulted in a range of implied values for the 0.1180 of a share of M&T common stock to be received in the proposed merger for each share of People’s United common stock of $16.59 to $19.95.

The dividend discount model analysis is a widely used valuation methodology, but the results of such methodology are highly dependent on the assumptions that must be made, including asset and earnings growth rates, terminal values and discount rates. The foregoing dividend discount model analysis did not purport to be indicative of the actual values or expected values of the pro forma combined entity.

Miscellaneous

KBW acted as financial advisor to People’s United in connection with the proposed transaction and did not act as an advisor to or agent of any other person. As part of its investment banking business, KBW is continually engaged in the valuation of bank and bank holding company securities in connection with acquisitions, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements and valuations for various other purposes. As specialists in the securities of banking companies, KBW has experience in, and knowledge of, the valuation of banking enterprises. KBW and its affiliates, in the ordinary course of its and their broker-dealer businesses (and further to existing sales and trading relationships between People’s United and each of KBW and a KBW broker-dealer affiliate), may from time to time purchase securities from, and sell securities to, People’s United and M&T. In addition, as a market maker in securities, KBW and its affiliates may from time to time have a long or short position in, and buy or sell, debt or equity securities of People’s United or M&T for its and their own respective accounts and for the accounts of its and their respective customers and clients.

Pursuant to the KBW engagement agreement, People’s United agreed to pay KBW a total cash fee equal to $34,000,000, $4,000,000 of which became payable to KBW at the announcement of the transaction and the balance of which is contingent upon the closing of the merger. People’s United also agreed to reimburse KBW for reasonable out-of-pocket expenses and disbursements incurred in connection with its retention and to indemnify KBW against certain liabilities relating to or arising out of KBW’s engagement or KBW’s role in connection therewith. In addition to the present engagement, in the two years preceding the date of its opinion, KBW provided investment banking or financial advisory services to People’s United and received compensation for such services. KBW acted as financial advisor to People’s United in connection with its (i) March 2019 acquisition of BSB Bancorp, Inc. and (ii) November 2019 acquisition of United Financial Bancorp, Inc. In connection with the foregoing acquisitions, KBW received fees of approximately $5,800,000 in the aggregate from People’s United. In the two years preceding the date of its opinion, KBW did not provide investment banking or financial advisory services to M&T. KBW may in the future provide investment banking and financial advisory services to People’s United or M&T and receive compensation for such services.

 

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Opinion of J.P. Morgan Securities LLC

Pursuant to an engagement letter, People’s United retained J.P. Morgan as its financial advisor in connection with the proposed transaction.

At the meeting of the People’s United board of directors on February 20, 2021, J.P. Morgan rendered its oral opinion, subsequently confirmed in J.P. Morgan’s written opinion dated as of February 20, 2021, to the People’s United board of directors that, as of such date and based upon and subject to the factors and assumptions set forth in its opinion, the exchange ratio in the proposed Transaction was fair, from a financial point of view, to the holders of People’s United Common Stock.

The full text of the written opinion of J.P. Morgan, dated as of February 20, 2021, which sets forth, among other things, the assumptions made, matters considered and limits on the review undertaken, is attached as Annex F to this joint proxy statement/prospectus and is incorporated herein by reference. The summary of the opinion of J.P. Morgan set forth in this joint proxy statement/prospectus is qualified in its entirety by reference to the full text of such opinion. Holders of People’s United common stock are urged to read the opinion in its entirety. J.P. Morgan’s written opinion was addressed to the People’s United board of directors (in its capacity as such) in connection with and for the purposes of its evaluation of the proposed Transaction, was directed only to the exchange ratio in the transaction and did not address any other aspect of the transaction. J.P. Morgan expressed no opinion as to the fairness of the consideration to be paid in connection with the transaction to the holders of People’s United preferred stock or any other holders of any class of securities, creditors or other constituencies of People’s United or as to the underlying decision by People’s United to engage in the proposed transaction. The issuance of J.P. Morgan’s opinion was approved by a fairness committee of J.P. Morgan. The opinion does not constitute a recommendation to any stockholder of People’s United as to how such stockholder should vote with respect to the proposed transaction or any other matter.

In arriving at its opinion, J.P. Morgan, among other things:

 

   

reviewed a draft of the merger agreement dated February 18, 2021;

 

   

reviewed certain publicly available business and financial information concerning People’s United and M&T and the industries in which they operate;

 

   

compared the financial performance of People’s United and M&T with publicly available information concerning certain other companies J.P. Morgan deemed relevant and reviewed the current and historical market prices of People’s United common stock and M&T common stock and certain publicly traded securities of such other companies;

 

   

reviewed certain internal financial analyses and forecasts prepared by the management of People’s United relating to the businesses of People’s United and M&T, as well as the estimated amount and timing of the cost savings and related expenses and synergies expected to result from the transaction (the “Synergies”); and

 

   

performed such other financial studies and analyses and considered such other information as J.P. Morgan deemed appropriate for the purposes of its opinion.

In addition, J.P. Morgan held discussions with certain members of the management of People’s United with respect to certain aspects of the transaction, and the past and current business operations of People’s United and M&T, the financial condition and future prospects and operations of People’s United and M&T, the effects of the transaction on the financial condition and future prospects of People’s United and M&T, and certain other matters J.P. Morgan believed necessary or appropriate to its inquiry.

In giving its opinion, J.P. Morgan relied upon and assumed the accuracy and completeness of all information that was publicly available or was furnished to or discussed with J.P. Morgan by People’s United or otherwise

 

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reviewed by or for J.P. Morgan, and J.P. Morgan did not independently verify (and did not assume responsibility or liability for independently verifying) any such information or its accuracy or completeness. J.P. Morgan did not conduct or was not provided with any valuation or appraisal of any assets or liabilities, nor did J.P. Morgan evaluate the solvency of People’s United or M&T under any applicable laws relating to bankruptcy, insolvency or similar matters. In relying on financial analyses and forecasts provided to J.P. Morgan or derived therefrom, including the Synergies, J.P. Morgan assumed that they were reasonably prepared based on assumptions reflecting the best currently available estimates and judgments by management as to the expected future results of operations and financial condition of People’s United and M&T to which such analyses or forecasts relate. J.P. Morgan expressed no view as to such analyses or forecasts (including the Synergies) or the assumptions on which they were based. J.P. Morgan also assumed that the transaction and the other transactions contemplated by the merger agreement will qualify as a tax-free reorganization for United States federal income tax purposes, and will be consummated as described in the merger agreement, and that the definitive merger agreement would not differ in any material respect from the draft thereof provided to J.P. Morgan. J.P. Morgan also assumed that the representations and warranties made by People’s United and M&T in the merger agreement and the related agreements were and will be true and correct in all respects material to its analysis. J.P Morgan is not a legal, regulatory or tax expert and relied on the assessments made by advisors to People’s United with respect to such issues. J.P. Morgan further assumed that all material governmental, regulatory or other consents and approvals necessary for the consummation of the transaction will be obtained without any adverse effect on People’s United or M&T or on the contemplated benefits of the transaction.

The projections furnished to J.P. Morgan were prepared by People’s United’s management. People’s United does not publicly disclose internal management projections of the type provided to J.P. Morgan in connection with J.P. Morgan’s analysis of the proposed transaction, and such projections were not prepared with a view toward public disclosure. These projections were based on numerous variables and assumptions that are inherently uncertain and may be beyond the control of People’s United’s management, including, without limitation, factors related to general economic and competitive conditions and prevailing interest rates. Accordingly, actual results could vary significantly from those set forth in such projections. For more information regarding the use of projections and other forward-looking statements, please refer to the section entitled “—Certain Unaudited Prospective Financial Information” beginning on page 95 of this joint proxy statement/prospectus.

J.P. Morgan’s opinion was necessarily based on economic, market and other conditions as in effect on, and the information made available to J.P. Morgan as of, the date of such opinion. J.P. Morgan’s opinion noted that subsequent developments may affect J.P. Morgan’s opinion, and that J.P. Morgan does not have any obligation to update, revise, or reaffirm such opinion. J.P. Morgan’s opinion is limited to the fairness, from a financial point of view, to the holders of People’s United common stock of the exchange ratio in the proposed transaction, and J.P. Morgan has expressed no opinion as to the fairness of any consideration to be paid in connection with the transaction to the holders of People’s United preferred stock or to the holders of any other class of securities, creditors or other constituencies of People’s United or the underlying decision by People’s United to engage in the transaction. Furthermore, J.P. Morgan expressed no opinion with respect to the amount or nature of any compensation to any officers, directors, or employees of any party to the proposed transaction, or any class of such persons relative to the exchange ratio in the proposed transaction or with respect to the fairness of any such compensation. J.P. Morgan expressed no opinion as to the price at which People’s United’s common stock or M&T’s common stock would trade at any future time.

The terms of the merger agreement, including the exchange ratio, were determined through arm’s length negotiations between People’s United and M&T, and the decision to enter into the merger agreement was solely that of People’s United’s board of directors and M&T’s board of directors. J.P. Morgan’s opinion and financial analyses were only one of the many factors considered by People’s United’s board of directors in its evaluation of the proposed transaction and should not be viewed as determinative of the views of People’s United’s board of directors or management with respect to the proposed transaction or the exchange ratio.

In accordance with customary investment banking practice, J.P. Morgan employed generally accepted valuation methodology in rendering its opinion to People’s United’s board of directors on February 20, 2021 and contained

 

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in the presentation delivered to People’s United’s board of directors on such date in connection with the rendering of such opinion. The summary below does not purport to be a complete description of the analyses or data presented by J.P. Morgan. Some of the summaries of the financial analyses include information presented in tabular format. The tables are not intended to stand alone, and in order to more fully understand the financial analyses used by J.P. Morgan, the tables must be read together with the full text of each summary. Considering the data set forth below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of J.P. Morgan’s analyses.

People’s United Public Trading Multiples Analysis

Using publicly available information, J.P. Morgan compared selected financial data of People’s United with similar data for selected publicly traded companies engaged in businesses which J.P. Morgan judged to be analogous to People’s United. The companies selected by J.P. Morgan were:

 

   

Wintrust Financial Corporation;

 

   

Webster Financial Corporation;

 

   

M&T;

 

   

F.N.B Corporation;

 

   

Valley National Bancorp; and

 

   

Citizens Financial Group.

These companies were selected by J.P. Morgan, based on its experience and familiarity with People’s United’s industry, because of similarities to People’s United in one or more of their business or regional characteristics and, in certain cases, similarities to People’s United based on certain operational characteristics and/or certain financial metrics. However, none of the companies selected is identical or directly comparable to People’s United, and certain of the companies may have characteristics that are materially different from those of People’s United. Accordingly, a complete analysis of the results of the following calculations cannot be limited to a quantitative review of such results and involves complex considerations and judgments concerning the differences in the financial and operating characteristics of the selected companies compared to People’s United and other factors that could affect the public trading value of the selected companies and People’s United.

In all instances, multiples were based on the closing stock price on February 19, 2021. For each of the following analyses performed by J.P. Morgan, financial and market data and earnings per share estimates for the selected companies were based on the selected companies’ public filings and information J.P. Morgan obtained from SNL Financial and FactSet Research Systems. The multiples and ratios for each of the selected companies were based on the most recent publicly available information.

With respect to the selected companies, the information J.P. Morgan presented included:

 

   

multiple of price to estimated earnings per share for the fiscal year 2022 (Price/2022E EPS);

 

   

multiple of price to tangible book value per share (P/TBVPS); and

 

   

the 2022 estimated return on average tangible common equity (2022E ROATCE).

Results of the analysis were presented for the selected companies, as indicated in the following table:

 

     Selected Companies’ Median  

Price/2022E EPS

     12.1x  

P/TBVPS

     1.48x  

2022E ROATCE

     11.7

 

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J.P. Morgan also performed a regression analysis to review, for the selected companies identified above, the relationship between (i) P/TBVPS and (ii) the 2022E ROATCE based on available estimates obtained from public filings, SNL Financial and FactSet Research Systems and People’s United’s management projections. Based on this analysis, J.P. Morgan derived a reference range for the implied P/TBVPS multiple of People’s United’s common stock of 1.40x to 1.61x.

Based on the above analysis, and such other factors as J.P. Morgan considered appropriate based on its experience and judgment, J.P Morgan then applied a multiple reference range of 10.8x to 12.7x for Price/2022E EPS and 1.40x to 1.61x for P/TBVPS to mean FactSet Research Systems consensus estimates of People’s United’s earnings for the fiscal year 2022 (as instructed by People’s United’s management) and People’s United’s tangible book, respectively. The analysis indicated the following equity values per share of People’s United’s common stock, as compared to the implied value of the merger consideration of $17.70 per share of People’s United’s common stock based on the closing price of M&T common stock on February 19, 2021.

 

     Equity Value Per Share  

Price/2022E EPS

   $ 14.00 - $16.25  

P/TBVPS

   $ 15.00 - $17.25  

People’s United Dividend Discount Analysis

J.P. Morgan calculated a range of implied values for People’s United’s common stock by discounting to present value estimates of People’s United’s future dividend stream and terminal value. In performing its analysis, J.P. Morgan utilized, among others, the following assumptions, which were reviewed and approved by People’s United’s management:

 

   

December 31, 2020 valuation date;

 

   

a five-year dividend discount model;

 

   

a terminal value based on 2026 estimated net income and a multiple range of 11.0x to 13.0x;

 

   

a fully diluted share count of People’s United’s common stock of 424.9 million shares;

 

   

cost of equity range of 10.5%—11.5%;

 

   

target tangible common equity to tangible assets ratio of 7.5%;

 

   

cost of excess capital of 1.00% (pre-tax);

 

   

24.0% marginal tax rate; and

 

   

Mid-year discounting convention.

These calculations resulted in a range of implied values of $14.75 to $17.00 per share of People’s United’s common stock, as compared to the implied value of the merger consideration of $17.70 per share of People’s United’s common stock based on the closing price of M&T common stock on February 19, 2021, as illustrated by the following table:

 

Discount Rate

  Terminal Multiple  
    11.0x     11.5x     12.0x     12.5x      13.0x  
10.5%   $ 15.25     $ 15.75     $ 16.25     $ 16.75      $ 17.00  
11.0%   $ 15.00     $ 15.50     $ 15.75     $ 16.25      $ 16.75  
11.5%   $ 14.75     $ 15.25     $ 15.50     $ 16.00      $ 16.50  

 

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M&T Public Trading Multiples Analysis

Using publicly available information, J.P. Morgan compared selected financial data of M&T with similar data for selected publicly traded companies engaged in businesses which J.P. Morgan judged to be analogous to M&T. The companies selected by J.P. Morgan were:

 

   

The PNC Financial Services Group, Inc.;

 

   

Wintrust Financial Corporation;

 

   

Truist Financial Corporation;

 

   

People’s United;

 

   

Valley National Bancorp; and

 

   

Citizens Financial Group.

These companies were selected by J.P. Morgan, based on its experience and familiarity with M&T’s industry, because of similarities to M&T in one or more of their business or regional characteristics and, in certain cases, similarities to M&T based on certain operational characteristics and/or certain financial metrics. However, none of the companies selected is identical or directly comparable to M&T, and certain of the companies may have characteristics that are materially different from those of M&T. Accordingly, a complete analysis of the results of the following calculations cannot be limited to a quantitative review of such results and involves complex considerations and judgments concerning the differences in the financial and operating characteristics of the selected companies compared to M&T and other factors that could affect the public trading value of the selected companies and M&T.

In all instances, multiples were based on closing stock price on February 19, 2021. For each of the following analyses performed by J.P. Morgan, financial and market data and earnings per share estimates for the selected companies were based on the selected companies’ public filings and information J.P. Morgan obtained from SNL Financial and FactSet Research Systems. The multiples and ratios for each of the selected companies were based on the most recent publicly available information.

With respect to the selected companies, the information J.P. Morgan presented included:

 

   

multiple of price to estimated earnings per share for the fiscal year 2022 (Price/2022E EPS);

 

   

multiple of price to tangible book value per share (P/TBVPS); and

 

   

the 2022 estimated return on average tangible common equity (2022E ROATCE).

Results of the analysis were presented for the selected companies, as indicated in the following table:

 

     Selected Companies’ Median  

Price/2022E EPS

     12.5x  

P/TBVPS

     1.67x  

2022E ROATCE

     13.3

J.P. Morgan also performed a regression analysis to review, for the selected companies identified above, the relationship between (i) P/TBVPS and (ii) the 2022E ROATCE based on available estimates obtained from public filings, SNL Financial and FactSet Research Systems and People’s United’s management’s projections. Based on this analysis, J.P. Morgan derived a reference range for the implied P/TBVPS multiple of M&T’s common stock of 1.67x to 1.90x.

Based on the above analysis, and such other factors as J.P. Morgan considered appropriate based on its experience and judgment, J.P. Morgan then applied a multiple reference range of 10.8x to 13.1x for Price/2022E

 

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EPS and 1.67x to 1.90x for P/TBVPS to mean FactSet Research Systems consensus estimates of M&T’s earnings for the fiscal year 2022 (as instructed by People’s United’s management) and M&T’s tangible book, respectively. The analysis indicated the following equity values per share of M&T’s common stock, as compared to the closing price of M&T common stock of $149.97 per share on February 19, 2021.

 

     Equity Value Per Share  

Price/2022E EPS

   $ 129.50 - $157.50  

P/TBVPS

   $ 134.25 - $152.75  

M&T Dividend Discount Analysis

J.P. Morgan calculated a range of implied values for M&T’s common stock by discounting to present value estimates of M&T’s future dividend stream and terminal value. In performing its analysis, J.P. Morgan utilized, among others, the following assumptions, which were reviewed and approved by People’s United’s management:

 

   

December 31, 2020 valuation date;

 

   

a five-year dividend discount model;

 

   

a terminal value based on 2026 estimated net income and a multiple range of 11.0x to 13.0x;

 

   

a fully diluted share count of M&T’s common stock of 129.1 million shares;

 

   

cost of equity range of 10.5%—11.5%;

 

   

target tangible common equity to tangible assets ratio of 7.5%;

 

   

cost of excess capital of 1.00% (pre-tax); and

 

   

26.0% marginal tax rate; and

 

   

Mid-year discounting convention.

These calculations resulted in a range of implied values of $126.75 to $147.25 per share of M&T’s common stock, as compared to the closing price of M&T common stock of $149.97 on February 19, 2021 as illustrated by the following table:

 

Discount Rate

  Terminal Multiple  
    11.0x     11.5x     12.0x     12.5x      13.0x  
10.5%   $ 131.50     $ 135.50     $ 139.25     $ 143.25      $ 147.25  
11.0%   $ 129.25     $ 133.00     $ 136.75     $ 140.75      $ 144.50  
11.5%   $ 126.75     $ 130.50     $ 134.25     $ 138.00      $ 141.75  

Relative Valuation Analysis

Based upon the implied valuations for each of People’s United and M&T as derived above under “People’s United Public Trading Multiples Analysis,” “—People’s United Dividend Discount Analysis,” “—M&T Public Trading Multiples Analysis” and “—M&T Dividend Discount Analysis,” J.P. Morgan calculated a range of implied exchange ratios of a share of People’s United common stock to a share of M&T common stock, and then compared that range of implied exchange ratios to the exchange ratio.

 

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For each of the analyses referred to above, J.P. Morgan calculated the ratio implied by dividing the low end of each range of implied equity values of People’s United by the high end of each range of implied equity values of M&T. J.P. Morgan also calculated the ratio implied by dividing the high end of each range of implied equity values of People’s United by the low end of each range of implied equity values of M&T

In each case, the implied exchange ratios were compared to the exchange ratio of 0.1180x and did not include any Synergies. This analysis indicated the following implied exchange ratios:

 

Comparison

   Range of Implied Exchange Ratios  

Public Trading Multiples Analysis

  

Price/2022E EPS

     0.0883x – 0.1264x  

P/TBVPS

     0.0987x – 0.1292x  

Dividend Discount Analysis

     0.0998x – 0.1347x  

Value Creation Analysis

At People’s United management’s direction and based on People’s United management’s projections, People’s United and M&T public filings, SNL Financial and FactSet, J.P. Morgan prepared a value creation analysis that compared the equity value of People’s United (based on the dividend discount analysis) to the People’s United stockholders’ portion of the pro forma combined company equity value. J.P. Morgan determined the pro forma combined company equity value by calculating the sum of (i) the equity value of M&T using the midpoint value determined in J.P. Morgan’s dividend discount analysis described above in “M&T Dividend Discount Analysis,” (ii) the equity value of People’s United derived using the midpoint value determined in J.P. Morgan’s dividend discount analysis described above in “People’s United Dividend Discount Analysis” (the “Standalone Value”) and (iii) the estimated present value of expected synergies, net of restructuring charges (using synergy net of restructuring charges amounts reviewed and approved by People’s United management, the midpoint of a discount rate range of 10.5-11.5% and the midpoint of an exit multiple range of 11.0x-13.0x). There can be no assurance that the synergies and transaction-related expenses will not be substantially greater or less than the estimate described above. The value creation analysis, at the exchange ratio of 0.1180x, yielded accretion to the holders of People’s United common stock of $1.76 per share, or $748 million in aggregate, as compared to the Standalone Value.

Historical Exchange Ratio Analysis

J.P. Morgan compared the historical median exchange ratio between People’s United common Stock and M&T common stock during different periods between February 19, 2016 and February 19, 2021. The historical median exchange ratios were calculated by dividing the daily closing price per share of People’s United common stock by the daily closing price per M&T common stock for each trading day in the indicated periods and then calculating the median for such period. These calculations were compared to the exchange ratio of 0.1180x. The table below sets forth the average exchange ratios for the time periods indicated:

 

Historical Period

   Median Exchange Ratio  

February 19, 2016 – February 19, 2021

     0.1065x  

February 19, 2019 – February 19, 2021

     0.1026x  

February 19, 2020 – February 19, 2021

     0.1063x  

January 1, 2021 – February 19, 2021

     0.1022x  

February 19, 2021

     0.1046x  

Certain Other Information

J.P. Morgan also reviewed and presented other information, solely for informational purposes, including:

 

   

historical trading prices of People’s United Common Stock for the 52-week period ending February 19, 2021;

 

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analyst share price targets for People’s United common stock in recently published, publicly available research analysts’ reports, with share price targets ranging from $14.00 to $17.00 and noting a median share price target of $15.00;

 

   

the application of the two-year forward price to earnings multiple in the precedent merger transaction between Huntington Bancshares Inc. and TCF Financial Corporation announced on December 13, 2020 to mean FactSet Research Systems consensus estimates of People’s United’s earnings for the fiscal year 2022 (as instructed by People’s United’s management), which implied a value of $15.50;

 

   

historical trading prices of M&T Common Stock for the 52-week period ending February 19, 2021; and

 

   

analyst share price targets for M&T common stock in recently published, publicly available research analysts’ reports, with share price targets ranging from $131.00 to $166.00 and noting a median share price target of $150.00.

Miscellaneous

The foregoing summary of certain material financial analyses does not purport to be a complete description of the analyses or data presented by J.P. Morgan. The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. J.P. Morgan believes that the foregoing summary and its analyses must be considered as a whole and that selecting portions of the foregoing summary and these analyses, without considering all of its analyses as a whole, could create an incomplete view of the processes underlying the analyses and its opinion. As a result, the ranges of valuations resulting from any particular analysis or combination of analyses described above were merely utilized to create points of reference for analytical purposes and should not be taken to be the view of J.P. Morgan with respect to the actual value of People’s United or M&T. The order of analyses described does not represent the relative importance or weight given to those analyses by J.P. Morgan. In arriving at its opinion, J.P. Morgan did not attribute any particular weight to any analyses or factors considered by it and did not form an opinion as to whether any individual analysis or factor (positive or negative), considered in isolation, supported or failed to support its opinion. Rather, J.P. Morgan considered the totality of the factors and analyses performed in determining its opinion.

Analyses based upon forecasts of future results are inherently uncertain, as they are subject to numerous factors or events beyond the control of the parties and their advisors. Accordingly, forecasts and analyses used or made by J.P. Morgan are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by those analyses. Moreover, J.P. Morgan’s analyses are not and do not purport to be appraisals or otherwise reflective of the prices at which businesses actually could be acquired or sold. None of the selected companies reviewed as described in the above summary is identical to People’s United or M&T. The transaction selected was similarly chosen because its participants, size and other factors, for purposes of J.P. Morgan’s analysis, may be considered similar to the transaction. However, the companies selected were chosen because they are publicly traded companies with operations and businesses that, for purposes of J.P. Morgan’s analysis, may be considered similar to those of People’s United and M&T. The analyses necessarily involve complex considerations and judgments concerning differences in financial and operational characteristics of the companies involved and other factors that could affect the companies compared to People’s United and M&T and the transactions compared to the transaction.

As a part of its investment banking business, J.P. Morgan and its affiliates are continually engaged in the valuation of businesses and their securities in connection with mergers and acquisitions, investments for passive and control purposes, negotiated underwritings, secondary distributions of listed and unlisted securities, private placements, and valuations for corporate and other purposes. J.P. Morgan was selected to advise People’s United with respect to the transaction on the basis of, among other things, such experience and its qualifications and reputation in connection with such matters and its familiarity with People’s United, M&T and the industries in which they operate.

For services rendered in connection with the transaction, People’s United has agreed to pay J.P. Morgan a fee of $20 million, $3 million of which became payable upon the delivery of J.P. Morgan’s opinion and the remainder

 

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of which will become payable only upon consummation of the transaction. In addition, People’s United has agreed to reimburse J.P. Morgan for its expenses incurred in connection with its services, including the fees and disbursements of counsel, and will indemnify J.P. Morgan against certain liabilities arising out of J.P. Morgan’s engagement.

During the two years preceding the date of J.P. Morgan’s opinion, neither J.P. Morgan nor any of its affiliates have had any other material financial advisory or other material commercial or investment banking relationships with People’s United or M&T. J.P. Morgan and its affiliates hold, on a proprietary basis, less than 1% of the outstanding common stock of People’s United. During the two-year period preceding delivery of its opinion, the aggregate fees recognized by J.P. Morgan from People’s United were approximately $35,000 and from M&T were approximately $4 million. In the ordinary course of their businesses, J.P. Morgan and its affiliates may actively trade the debt and equity securities or financial instruments (including derivatives, bank loans or other obligations) of People’s United or M&T for their own accounts or for the accounts of customers and, accordingly, they may at any time hold long or short positions in such securities or other financial instruments.

Certain Unaudited Prospective Financial Information

M&T and People’s United do not, as a matter of course, publicly disclose forecasts or internal projections as to their respective future performance, revenues, earnings, financial condition or other results given, among other reasons, the inherent uncertainty of the underlying assumptions and estimates, other than, in the case of M&T, from time to time, estimated ranges of certain financial measures for the current year in its earnings conference calls and investor conference presentations and, in the case of People’s United, from time to time, estimated ranges of certain expected financial results for the current year and certain future years in its earnings investor presentations and other investor materials.

However, M&T and People’s United are including in this joint proxy statement/prospectus certain unaudited prospective financial information for M&T and People’s United that was made available as described below. We refer to this information collectively as the “prospective financial information.” A summary of certain significant elements of this information is set forth below and is included in this joint proxy statement/prospectus solely for the purpose of providing M&T shareholders and People’s United stockholders access to certain nonpublic information made available to M&T and People’s United and their respective boards of directors and financial advisors.

Neither M&T nor People’s United endorses the prospective financial information as necessarily predictive of actual future results. Furthermore, although presented with numerical specificity, the prospective financial information reflects numerous estimates and assumptions made by M&T senior management or People’s United senior management, as applicable, at the time such prospective financial information was prepared or approved for use by the financial advisors. The prospective financial information represents M&T senior management’s or People’s United senior management’s respective evaluation of M&T’s and People’s United’s expected future financial performance on a stand-alone basis, without reference to the merger (except as expressly set forth below under “—Certain Estimated Synergies Attributable to the Merger”). In addition, since the prospective financial information covers multiple years, such information by its nature becomes subject to greater uncertainty with each successive year. These and the other estimates and assumptions underlying the prospective financial information involve judgments with respect to, among other things, economic, competitive, regulatory and financial market conditions and future business decisions that may not be realized and that are inherently subject to significant business, economic, competitive and regulatory uncertainties and contingencies, including, among other things, the inherent uncertainty of the business and economic conditions affecting the industries in which M&T and People’s United operate and the risks and uncertainties described under “Risk Factors” beginning on page 31 of this joint proxy statement/prospectus and “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 29 of this joint proxy statement/prospectus and in the reports that M&T and People’s United file with the SEC from time to time, all of which are difficult to predict and many of which are outside the control of M&T and People’s United and will be beyond the control of M&T following the

 

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completion of the merger. There can be no assurance that the underlying assumptions or projected results will be realized, and actual results could differ materially from those reflected in the prospective financial information, whether or not the merger is completed. Further, these assumptions do not include all potential actions that the senior management of M&T or People’s United could or might have taken during these time periods. The inclusion in this joint proxy statement/prospectus of the prospective financial information below should not be regarded as an indication that M&T, People’s United or their respective boards of directors or advisors considered, or now consider, this prospective financial information to be material information to any M&T shareholders or People’s United stockholders, as the case may be, particularly in light of the inherent risks and uncertainties associated with such prospective financial information, or that it should be construed as financial guidance, and it should not be relied on as such. This information was prepared solely for internal use and is subjective in many respects and thus is susceptible to multiple interpretations and periodic revisions based on actual experience and business developments. The prospective financial information is not fact and should not be relied upon as necessarily indicative of actual future results. The prospective financial information also reflects numerous variables, expectations and assumptions available at the time it was prepared as to certain business decisions that are subject to change and does not take into account any circumstances or events occurring after the date it was prepared, including the transactions contemplated by the merger agreement or the possible financial and other effects on M&T or People’s United of the merger, and does not attempt to predict or suggest actual future results of M&T following the completion of the merger or give effect to the merger, including the effect of negotiating or executing the merger agreement, the costs that may be incurred in connection with consummating the merger, the potential synergies that may be achieved by M&T as a result of the merger (except as expressly set forth below under “—Certain Estimated Synergies Attributable to the Merger”), the effect on M&T or People’s United of any business or strategic decision or action that has been or will be taken as a result of the merger agreement having been executed, or the effect of any business or strategic decisions or actions which would likely have been taken if the merger agreement had not been executed, but which were instead altered, accelerated, postponed or not taken in anticipation of the merger (in each case, except as expressly set forth below under “—Certain Estimated Synergies Attributable to the Merger”). Further, the prospective financial information does not take into account the effect of any possible failure of the merger to occur. No assurances can be given that if the prospective financial information and the underlying assumptions had been prepared as of the date of this joint proxy statement/prospectus, similar assumptions would be used. In addition, the prospective financial information may not reflect the manner in which M&T would operate after the merger.

The accompanying prospective financial information was not prepared for the purpose of, or with a view toward, public disclosure or with a view toward complying with the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information, published guidelines of the SEC regarding forward-looking statements or generally accepted accounting principles.

Subject to the above, the prospective financial information included in this section has been provided by M&T’s management and People’s United’s management as described in this section. Neither PricewaterhouseCoopers LLP (M&T’s independent registered public accounting firm), KPMG LLP (People’s United’s independent registered public accounting firm), nor any other independent registered public accounting firm, has audited, reviewed, examined, compiled or applied agreed-upon procedures with respect to the accompanying prospective financial information and, accordingly, each of PricewaterhouseCoopers LLP and KPMG LLP does not express an opinion or any other form of assurance with respect thereto or its achievability and assumes no responsibility for the prospective financial information and disclaims any association with the prospective financial information. The reports by PricewaterhouseCoopers LLP and KPMG LLP incorporated by reference in this joint proxy statement/prospectus relate to M&T’s and People’s United’s previously issued financial statements. They do not extend to the prospective financial information and should not be read to do so.

Certain Stand-Alone People’s United Prospective Financial Information Used by Lazard

The following table presents certain prospective financial information with respect to People’s United used by Lazard at M&T management’s direction in performing its financial analysis with respect to People’s United on a

 

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standalone basis as described in “—Opinion of M&T’s Financial Advisor” beginning on page 62, which we refer to as “People’s United stand-alone projections” in that section. Such prospective financial information reflects prospective financial information with respect to People’s United provided by M&T management for calendar years 2021 through 2023, which was based in part on preliminary information provided by People’s United management, as extrapolated for calendar years 2024 through 2026 using assumptions approved for use by Lazard by M&T management. For purposes of extrapolating People’s United prospective financial information for calendar years 2024 through 2026, M&T management provided Lazard with, among other assumptions, an annual net income growth rate of 5% and an annual growth rate of tangible assets of 3%.

 

(Dollars in millions, except per share data)

   2021E      2022E      2023E  

Net Income to Common Stockholders

   $ 465      $ 467      $ 498  

Diluted Earnings Per Share

   $ 1.11      $ 1.17      $ 1.24  

Tangible Assets

   $ 56,600      $ 58,664      $ 59,841  

Certain Stand-Alone M&T Prospective Financial Information Used by Lazard

The following table presents certain prospective financial information with respect to M&T used by Lazard at M&T management’s direction in performing its financial analysis with respect to M&T on a stand-alone basis as described in “—Opinion of M&T’s Financial Advisor” beginning on page 62, which we refer to as the “M&T stand-alone projections” in that section. Such prospective financial information reflects prospective financial information with respect to M&T provided by M&T management for calendar years 2021 through 2026 and was approved for use by Lazard by M&T management.

 

(Dollars in millions, except per share data)

   2021E      2022E      2023E      2024E      2025E      2026E  

Net Income to Common Shareholders

   $ 1,463      $ 1,493      $ 1,511      $ 1,604      $ 1,654      $ 1,705  

Diluted Earnings Per Share

   $ 11.54      $ 12.25      $ 12.94      $ 14.41      $ 15.71      $ 17.18  

Tangible Assets

   $ 133,582      $ 135,438      $ 132,537      $ 132,191      $ 133,441      $ 134,696  

Certain Stand-Alone People’s United Prospective Financial Information Used by KBW

The following table presents the consensus Wall Street research estimates for People’s United’s 2021 and 2022 net income available to People’s United common stockholders, diluted EPS and total assets, which we refer to collectively as the People’s United street estimates, that were used by KBW at the direction of People’s United management in the financial analyses performed in connection with KBW’s opinion as described in “—Opinions of People’s United’s Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” beginning on page 74.

 

(Dollars in millions, except per share data)

   2021E      2022E  

Net Income to Common Stockholders

   $ 545      $ 542  

Diluted Earnings Per Share

   $ 1.28      $ 1.29  

Total Assets

   $ 62,171      $ 63,179  

For purposes of extrapolating People’s United financial results, People’s United senior management provided KBW with, among other things, estimated long-term annual growth rates of 5% for People’s United’s net income and 3% for People’s United’s assets, an estimated pre-tax cost of cash of 1.00% and an estimated marginal tax rate of 24.0%.

Certain Stand-Alone M&T Prospective Financial Information Used by KBW

The following table presents the consensus Wall Street research estimates for M&T’s 2021 and 2022 net income available to M&T common shareholders, diluted EPS and total assets, which we refer to collectively as the M&T street estimates, that were used by KBW at the direction of People’s United management in the financial analyses

 

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performed in connection with KBW’s opinion as described in “The Merger—Opinions of People’s United’s Financial Advisors—Opinion of Keefe, Bruyette & Woods, Inc.” beginning on page 74.

 

(Dollars in millions, except per share data)

   2021E      2022E  

Net Income to Common Stockholders

   $ 1,518      $ 1,449  

Diluted Earnings Per Share

   $ 12.08      $ 12.03  

Total Assets

   $ 142,207      $ 140,399  

For purposes of extrapolating M&T financial results, People’s United senior management directed KBW to use, among other things, estimated long-term annual growth rates of 3.5% for M&T’s net income and 1% for M&T’s assets, an estimated pre-tax cost of cash of 1.00% and an estimated marginal tax rate of 26.0%.

Certain Stand-Alone People’s United Prospective Financial Information Used by J.P. Morgan

The following table presents the consensus Wall Street research estimates for People’s United’s 2021 and 2022 net income available to People’s United common stockholders, diluted EPS and total assets, which we refer to collectively as the People’s United street estimates, that were used by J.P. Morgan at the direction of People’s United management in the financial analyses performed in connection with J.P. Morgan’s opinion as described in “The Merger—Opinions of People’s United’s Financial Advisors—Opinion of J.P. Morgan Securities LLC” beginning on page 87. The table also presents extrapolations for 2023 through 2026 based on assumptions provided by People’s United senior management. For purposes of extrapolating People’s United financial results, People’s United senior management provided J.P. Morgan with, among other things, estimated long-term annual growth rates of 5.0% for People’s United’s net income and 3.0% for People’s United’s assets, an estimated pre-tax cost of cash of 1.00% and an estimated marginal tax rate of 24.0%.

 

(Dollars in millions, except per share data)

   2021E      2022E      2023E      2024E      2025E      2026E  

Net Income to Common Stockholders

   $ 545      $ 542      $ 570      $ 598      $ 628      $ 659  

Diluted Earnings Per Share

   $ 1.28      $ 1.29      $ 1.34      $ 1.41      $ 1.48      $ 1.56  

Total Assets

   $ 62,171      $ 63,179      $ 65,074      $ 67,027      $ 69,037      $ 71,108  

Certain Stand-Alone M&T Prospective Financial Information Used by J.P. Morgan

The following table presents the consensus Wall Street research estimates for M&T’s 2021 and 2022 net income available to M&T common shareholders, diluted EPS and total assets, which we refer to collectively as the M&T street estimates, that were used by J.P. Morgan at the direction of People’s United management in the financial analyses performed in connection with J.P Morgan’s opinion as described in “The Merger—Opinions of People’s United’s Financial Advisors—Opinion of J.P. Morgan Securities LLC” beginning on page 87. The table also presents extrapolations for 2023 through 2026 based on assumptions provided by People’s United senior management. For purposes of extrapolating M&T financial results, People’s United senior management provided J.P. Morgan with, among other things, estimated long-term annual growth rates of 3.5% for M&T’s net income and 1.0% for M&T’s assets, an estimated pre-tax cost of cash of 1.00% and an estimated marginal tax rate of 26.0%.

 

(Dollars in millions, except per share data)

   2021E      2022E      2023E      2024E      2025E      2026E  

Net Income to Common Stockholders

   $ 1,518      $ 1,449      $ 1,500      $ 1,552      $ 1,606      $ 1,663  

Diluted Earnings Per Share

   $ 12.08      $ 12.03      $ 12.92      $ 14.10      $ 15.54      $ 17.19  

Total Assets

   $ 142,207      $ 140,399      $ 141,803      $ 143,221      $ 144,653      $ 146,099  

Certain Estimated Synergies Attributable to the Merger

M&T management developed and provided to its board of directors certain prospective financial information relating to the anticipated cost synergies to be realized by M&T following the completion of the merger

 

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beginning in 2021. Such prospective financial information also was (i) provided to People’s United, (ii) provided to Lazard and approved by M&T for Lazard’s use and reliance, and (iii) provided to KBW and J.P. Morgan and approved by People’s United for KBW’s and J.P. Morgan’s use and reliance, in each case in connection with such financial advisors’ respective financial analyses and opinions as described in this joint proxy statement/prospectus under “—Opinion of M&T’s Financial Advisor” and “—Opinions of People’s United’s Financial Advisors.”

The cost synergies consisted of fully phased-in estimated annual cost savings of approximately 30% of People’s United’s 2020 operating non-interest expense, phased in approximately 85% in 2022 and 100% thereafter. The cost synergies assumed a hypothetical October 1, 2021 closing date for the merger.

See above in this section for further information regarding the uncertainties underlying the synergy estimates as well as the sections entitled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” beginning on pages 29 and 31, respectively, for further information regarding the uncertainties and factors associated with realizing synergies in connection with the merger.

General

The stand-alone prospective financial information for M&T and People’s United was prepared separately using, in some cases, different assumptions, and is not intended to be added together. Adding the financial forecasts together for the two companies is not intended to represent the results M&T will achieve if the merger is completed and is not intended to represent forecasted financial information for M&T if the merger is completed.

By including in this joint proxy statement/prospectus a summary of the prospective financial information, neither M&T or People’s United nor any of their respective representatives has made or makes any representation to any person regarding the ultimate performance of M&T or People’s United compared to the information contained in the prospective financial information. Neither M&T nor People’s United undertakes any obligation to update or otherwise revise the prospective financial information to reflect circumstances existing since their preparation or to reflect the occurrence of subsequent or unanticipated events, even in the event that any or all of the underlying assumptions are shown to be inappropriate, or to reflect changes in general economic or industry conditions. None of M&T, People’s United or their respective advisors or other representatives has made, makes or is authorized in the future to make any representation to any M&T shareholders, People’s United stockholders or other person regarding M&T’s and People’s United’s ultimate performance compared to the information contained in the prospective financial information or that the results reflected in the prospective financial information will be achieved. The prospective financial information included above is provided because it was made available to and considered by M&T and People’s United and their respective boards of directors and financial advisors in connection with the merger.

In light of the foregoing, and considering that the M&T and People’s United special meetings will be held several months after the prospective financial information was prepared, as well as the uncertainties inherent in any forecasted information, M&T shareholders and People’s United stockholders are cautioned not to place unwarranted reliance on such information, and are urged to review M&T’s and People’s United’s most recent SEC filings for a description of their reported financial results and the financial statements of M&T and People’s United incorporated by reference in this joint proxy statement/prospectus. See the section entitled “Where You Can Find More Information” beginning on page 179. The prospective financial information summarized in this section is not included in this joint proxy statement/prospectus in order to induce any holder of M&T common stock to vote in favor of the M&T charter amendment proposal, the M&T share issuance proposal or any of the other proposals to be voted on at the M&T special meeting or to induce any holder of People’s United common stock to vote in favor of the People’s United merger proposal or any of the other proposals to be voted on at the People’s United special meeting.

 

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Interests of Certain People’s United Directors and Executive Officers in the Merger

In considering the recommendation of People’s United’s board of directors that you vote “FOR” the merger proposal, you should be aware that aside from their interests as People’s United stockholders, People’s United’s directors and executive officers have interests in the merger that are different from, or in addition to, those of People’s United stockholders generally. References to the named executive officers of People’s United include Messrs. John P. Barnes, Lee C. Powlus, R. David Rosato, Jeffrey J. Tengel and Kirk W. Walters. Members of People’s United’s board of directors were aware of and considered these interests, among other matters, in evaluating and negotiating the merger agreement and the mergers, and in recommending that People’s United stockholders vote in favor of the merger proposal. For more information, see “—Background of the Merger” beginning on page 55 and “—People’s United’s Reasons for the Merger; Recommendation of People’s United’s Board of Directors” beginning on page 71. These interests are described in more detail below, and certain of them are quantified in the narrative and in the section entitled “—Quantification of Potential Payments and Benefits to People’s United’s Named Executive Officers in Connection with the Merger” beginning on page 105.

Treatment of People’s United Equity Awards

The People’s United long-term incentive plan governing the treatment of People’s United equity awards provides for “double-trigger” vesting if the executive officer is terminated by People’s United without cause, or as a result of the executive officer’s death or disability if the executive officer dies or becomes disabled, in each case, following a change in control. The closing will constitute a change in control for purposes of the People’s United equity awards. Accordingly, if the executive officer experiences a qualifying termination following the closing, all unvested M&T converted equity awards will fully vest. Additionally, pursuant to the merger agreement, any M&T converted equity awards will also fully vest upon a subsequent change in control of M&T following the closing.

For an estimate of the amounts that would be realized by each of People’s United’s named executive officers upon a qualifying termination event in settlement of his unvested M&T converted equity awards, see “—Quantification of Potential Payments and Benefits to People’s United’s Named Executive Officers in Connection with the Merger” below. The estimated aggregate amount that would be realized by the nine executive officers who are not named executive officers in settlement of his or her unvested People’s United equity awards that were outstanding on March 24, 2021 (including associated dividend and dividend equivalent rights accrued thereon), if the effective time occurred on October 1, 2021, and each executive officer experienced a qualifying termination on that date is $8,627,094. This amount is calculated using a price per share of M&T’s common stock of $156.88 (the average closing price of M&T’s common stock on the first five business days following the announcement of the merger) and, in the case of People’s United performance shares, assumed target performance. In addition, the estimated aggregate amount that would be realized by the ten People’s United non-employee directors in settlement of their director restricted shares (including associated dividend rights accrued thereon) that are outstanding as of March 24, 2021, if the effective time occurred on October 1, 2021, is $0, as all director restricted shares are scheduled to vest on the earlier of (i) May 21, 2021 or (ii) the date of the People’s United 2021 annual meeting. It is expected that People’s United’s non-employee directors will be granted additional restricted shares in the ordinary course of business consistent with past practice prior to the closing of the merger. This amount is calculated using a price per share of M&T’s common stock of $156.88 (the average closing price of M&T’s common stock on the first five business days following the announcement of the merger). These amounts do not attempt to forecast any additional equity grants, issuances or forfeitures that may occur prior to the closing and do not include any additional dividend rights or dividend equivalent rights that will accrue prior to the closing. As a result of the foregoing assumptions, which may or may not be accurate on the relevant date, the actual amounts, if any, to be realized by People’s United’s executive officers who are not named executive officers and directors may materially differ from the amounts set forth above.

 

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People’s United Restricted Share Awards

At the effective time, each outstanding People’s United restricted share under the People’s United stock plans other than any People’s United director restricted shares, will, automatically and without any action on the part of the holder thereof, cease to represent a restricted share of People’s United common stock and will be converted into a number of M&T restricted shares equal to the exchange ratio (rounded up or down to the nearest whole number, with 0.5 rounding up). Except as specifically provided in the merger agreement, at and following the effective time, each such M&T restricted share will continue to be governed by the same terms and conditions (including vesting terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United restricted share immediately prior to the effective time.

People’s United Performance Share Awards

At the effective time, each outstanding People’s United performance share under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the part of the holder thereof, cease to represent a performance share unit denominated in shares of People’s United common stock and will be converted into an M&T stock-based RSU. The number of shares of M&T common stock subject to each such M&T stock-based RSU will be equal to the product (rounded up or down to the nearest whole number, with 0.5 rounding up) of (i) the number of shares of People’s United common stock subject to such People’s United performance share immediately prior to the effective time (including any applicable dividend equivalents) based on the higher of target performance and actual performance through the effective time as reasonably determined by the compensation committee of the People’s United board of directors in its reasonable judgment and in consultation with M&T, multiplied by (ii) the exchange ratio. Except as specifically provided in the merger agreement, at and following the effective time, each such M&T stock-based RSU will continue to be governed by the same terms and conditions (including employment vesting terms but excluding performance conditions, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to the applicable People’s United performance share immediately prior to the effective time.

People’s United Option Awards

At the effective time, each outstanding People’s United option under the People’s United stock plans, whether vested or unvested, will, automatically and without any action on the part of the holder thereof, cease to represent an option to purchase shares of People’s United common stock and will be converted into an M&T option equal to the product (rounded down to the nearest whole number) of (i) the number of shares of People’s United common stock subject to such People’s United option immediately prior to the effective time and (ii) the exchange ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (a) the exercise price per share of People’s United common stock of such People’s United option immediately prior to the effective time divided by (b) the exchange ratio; provided, however, that the exercise price and the number of shares of M&T common stock purchasable pursuant to the People’s United options will be determined in a manner consistent with the requirements of Section 409A of the Code; provided, further, that in the case of any People’s United option to which Section 422 of the Code applies, the exercise price and the number of shares of People’s United common stock purchasable pursuant to such option will be determined in accordance with the foregoing, subject to such adjustments as are necessary in order to satisfy the requirements of Section 424(a) of the Code. Except as specifically provided in the merger agreement or in the confidential disclosure schedules, following the effective time, each People’s United option will continue to be governed by the same terms and conditions (including vesting and exercisability terms, after giving effect to any “change in control” post-termination protections under the applicable People’s United stock plan or award agreement) as were applicable to such People’s United option immediately prior to the effective time.

 

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The merger agreement also provides that, in the event of a “Change in Control” (as defined in the M&T equity plan) following the closing, any then-outstanding M&T converted equity award, to the extent not then vested, will be treated in accordance with Section 10.1 of the M&T equity plan.

Change in Control Employee Severance Plan

Pursuant to the terms of the merger agreement and the confidential disclosure schedules, during the period commencing at the effective time and ending on the third anniversary of the effective time, any continuing employee of People’s United, including each executive officer, who is involuntarily terminated or, if applicable, resigned for good reason, will be entitled to receive severance benefits pursuant to the 2007 CIC Plan if such employee is a participant in the 2007 CIC Plan.

Change in Control Agreements

People’s United entered into agreements with each of eighty-five (85) employees (including each of its five named executive officers and its other executive officers, except for one executive officer who retired in 2020) which provide certain payments and benefits in the event the employee’s employment is terminated under specified circumstances and within a specified period of time following a change in control. Each such agreement (a “change in control agreement”) remains in effect until the employee’s employment is terminated prior to the occurrence of a change in control, or termination of the employee’s employment following the three-year protection period following a change in control.

If such employee’s employment is terminated without cause, or the employee terminated his or her employment for good reason (each as defined in the change in control agreement), within three years following the occurrence of a change in control at a time when the change in control agreement is in effect, People’s United will make payments and provide benefits to the employee as follows: