| Item 1.01 | Entry into a Material Definitive Agreement. |
On March 13, 2022, MVB Bank, Inc., a West Virginia state chartered bank (the “Bank”) and wholly-owned subsidiary of MVB Financial Corp. (“MVB”), and Warp Speed Holdings LLC, a Wyoming limited liability company (“Warp Speed”), entered into an Equity Purchase Agreement (the “Agreement”), pursuant to which the Bank agreed to purchase Class B Common Units of Warp Speed in an amount equal to thirty-eight percent (38%) of the outstanding equity interests of Warp Speed on a fully-diluted basis (the “MVB Investment”).
Immediately prior to the closing of the MVB Investment, the pre-closing members of Warp Speed will contribute to Warp Speed all of their equity interests in certain operating companies in exchange for equity interests in Warp Speed (the “Put-Together Transaction”). Upon completion of the Put-Together Transaction, Warp Speed will serve as a holding company whose subsidiaries are focused on residential and commercial loan origination and servicing, business and personal insurance brokerage and data analytics. In connection with the closing of the MVB Investment, Warp Speed will also cause the redemption of all or a portion of certain Warp Speed members’ equity interests, with the cash consideration to be paid by the Bank for the MVB Investment as further described below (the “Redeemed Interests”).
The aggregate consideration to be paid by the Bank for the MVB Investment at closing pursuant to the Agreement is (i) $38,400,000 in cash (the “Aggregate Cash Consideration”), plus (ii) shares of newly issued common stock of MVB with an aggregate value as of the closing date of $9,579,429.47, based on the volume-weighted average closing price for shares of MVB common stock for the 20 trading days ending the day prior to the closing date. At closing, the Bank will pay the MVB Cash Consideration (less brokers’ fees, if any) to certain members of Warp Speed who elect to receive cash consideration for their Redeemed Interests, and will remit the MVB Stock Consideration to each pre-closing member of Warp Speed, minus a portion of the MVB Stock Consideration that will be held in escrow and disbursed in accordance with the terms of escrow.
The Agreement may be terminated at any time prior to the closing date by mutual consent of the parties, by either party in certain specified circumstances, including material breach of the Agreement by the other party, failure by either party to receive any material approval of a governmental entity or if the transactions contemplated by the Agreement have not been consummated on or before December 31, 2022. The completion of the MVB Investment is subject to certain regulatory approvals, conditions precedent and other customary closing conditions. The Agreement also includes other customary representations, warranties, covenants, indemnification and other contractual provisions, including covenants to enter into ancillary agreements associated with the MVB Investment.
The foregoing description of the Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the Agreement, which is attached as Exhibit 10.1 hereto, and is incorporated into this Current Report on Form 8-K by reference.
On March 14, 2022, MVB issued a Press Release announcing entry into the Agreement. A copy of the Press Release is attached as Exhibit 99.1 hereto and is incorporated into this Current Report on Form 8-K by reference.
