People's United Financial, Inc. (NasdaqGS:PBCT) entered into an agreement to acquire United Financial Bancorp, Inc. (NasdaqGS:UBNK) for approximately $750 million on July 15, 2019. Under the terms of the agreement, United Financial Bancorp, Inc. shareholders will receive 0.875 shares of People's United Financial, Inc. (NasdaqGS:PBCT) stock for each share held. The transaction is valued at $14.74 per United Financial Bancorp, Inc. share, based on the closing price of People's United Financial, Inc.'s common stock on July 12, 2019. At the effective time, stock option of United Financial, whether or not then vested or free of conditions to payment, shall be cancelled and converted into the right to receive a number of shares of People's United common stock equal to the quotient of (i) the product of (A) the number of shares of United Financial common stock subject to such option, multiplied by (B) the excess, if any, of the per share stock consideration over the exercise price per share of such option, divided by People's United's share closing price. Each performance-based restricted stock unit (PSU) of United Financial and each other outstanding equity-based award shall be cancelled and converted into the right to receive a number of shares of People's United common stock equal to the product of the number of shares of United Financial subject to such PSU or equity-based award, multiplied by the exchange ratio. Upon closing, People's United Financial, Inc. will hold 90% of the combined entity while United Financial Bancorp, Inc. will hold 10%. Following the merger, United Bank, a wholly owned subsidiary of United Financial, will merge with and into People's United Bank, National Association, a wholly owned subsidiary of People's United, with People's United Bank, National Association surviving.

The merger agreement provides that a termination fee of $28.28 million will be payable by United Financial to People's United upon termination of the agreement under certain circumstances. Completion of the transaction is subject to the receipt of regulatory approvals including the approval of the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency and the State of Connecticut Department of Banking, approval of shareholders of United Financial, authorization for listing on NASDAQ Global Select Market of the shares of People's United to be issued in the merger, the effectiveness of the registration statement on Form S-4 for the People's United common stock to be issued in the merger, People's United and United Financial having received the written opinion from Simpson Thacher & Bartlett LLP and Sullivan & Cromwell LLP respectively, to the effect that the merger will be treated as a reorganization within the meaning of Section 368(a) of the Code. The Board of Directors of United Financial received an opinion of Sandler O'Neill & Partners, LP to the effect that, the exchange ratio in the merger is fair from a financial point of view to the holders of common stock of United Financial. The transaction has been unanimously approved by Boards of Directors of People's United and United Financial. The Board of United Financial Bancorp, Inc. recommends shareholders to vote in favor of the transaction in a meeting expected on October 22, 2019. As of September 5, 2019, the registration statement became effective. As of October 11, 2019, all requisite regulatory approvals and waivers necessary to complete the merger were obtained.

The transaction is expected to close during the fourth quarter of 2019. As of October 11, 2019, consummation of the merger is expected to be effective on November 1, 2019. People's United Financial, Inc. expects the transaction to be $0.07 accretive to earnings per common share based on fully phased-in cost savings, with a tangible book value earn-back of approximately 2.3 years and an IRR of approximately 18%. Frank Cicero, Jordan Banov, Roger Wang, Dan Gerard and Jack Parkhurst of Keefe, Bruyette & Woods, Inc. acted as financial advisors and Lee Meyerson, Johanna Mayer, Lauren Kim, Adam Cohen, Spencer Sloan, Jeannine McSweeney, Jason Fixelle, Jonathan Goldstein and Sarah Katz of Simpson Thacher & Bartlett LLP acted as legal advisors for People's United Financial, Inc. Brian Sterling and Jon Doyle of Sandler O'Neill & Partners acted as financial advisors and fairness opinion provider and C. Andrew Gerlach, Marc Treviño, Eric Wang and Mehdi Ansari of Sullivan & Cromwell LLP acted as legal advisors for United Financial Bancorp, Inc. Frank Cicero, Jordan Banov, Roger Wang of Stifel Financial Corp. (NYSE:SF) acted as financial advisors to People's United. Morrow Sodali LLC acted as proxy solicitor for United Financial Bancorp, Inc. and will receive a fee of $15,000 for its services. RP Financial, LC acted as financial advisor for United Financial Bancorp, Inc. United Financial has agreed to pay Sandler O'Neill a transaction fee in an amount equal to 1.00% of the aggregate merger consideration, which transaction fee is contingent upon the closing of the merger. At the time of announcement of the merger, Sandler O'Neill's transaction fee was approximately $7.5 million. Sandler O'Neill also received a $0.5 million fee upon rendering its fairness opinion to United Financial's board of directors. Computershare, Inc. acted as the transfer agent and registrar to People's United.