On March 1, 2025, ChoiceOne completed the Merger, in an all stock transaction, of Fentura, the former parent company of The State Bank, with and into ChoiceOne, with ChoiceOne surviving the Merger. The primary reason for the Merger was to expand ChoiceOne's market presence and enhance its financial strength by integrating Fentura's substantial customer base. On March 14, 2025, ChoiceOne Bank completed the consolidation of The State Bank with and into ChoiceOne Bank, with ChoiceOne Bank surviving the consolidation. Fentura had 20 branch offices and one loan production office as of the date of the Merger. Total assets acquired in the Merger were approximately $1.8 billion, including total loans of approximately $1.4 billion. Total deposits acquired in the Merger, the majority of which were core deposits, totaled approximately $1.4 billion. The impact of the Merger has been included in ChoiceOne’s results of operations since March 1, 2025. As consideration in the Merger, ChoiceOne issued 6,070,836 shares of ChoiceOne common stock with an approximate total value of $193.0 million. The results of Merger are included in the results of ChoiceOne subsequent to the merger date. Transaction costs incurred after the merger date were primarily in salaries and employee benefits and legal and consulting in the Consolidated Statements of Operations, as well as a $12.0 million provision for credit losses. The initial accounting for the business combination has been determined provisionally for the fair value of certain assets and liabilities, including loans, core deposit intangible, and deferred taxes. Management expects to finalize calculations supporting the fair value of these assets and liabilities during the measurement period.


Purchase Price

Consideration	$	192,992

Net assets acquired:
Cash and cash equivalents		173,082
Securities available for sale		90,696
Federal Home Loan Bank and Federal Reserve Bank stock		9,179
Originated loans		1,376,721
Premises and equipment		16,664
Other real estate owned		1,735
Intangible assets		34,737
Other assets		48,815
Total assets		1,751,629

Non-interest bearing deposits		404,497
Interest bearing deposits		1,027,384
Total deposits		1,431,881
Borrowing		169,786
Subordinated debentures		12,344
Other liabilities		11,410
Total liabilities		1,625,421

Net assets acquired		126,208

Goodwill	$	66,784

The proforma information below reflects adjustments made to exclude the impact of after-tax merger - related expenses of $13.8 million and the non-recurring provision for credit losses on acquired loans of $9.5 million for the first quarter of 2025 and include such expenses in the first quarter of 2024. Adjustments also included adjusting net interest income by the estimated accretion of fair value marks on acquired loans of $1.6 million in 2025 and $2.4 million in 2024. Additionally, the net income (loss) was adjusted to reflect the after tax impact of the interest income offset by the impact of intangible amortization of $1.1 million and $1.6 million in 2025 and 2024, respectively, resulting in an after tax adjustment to net income (loss) of $433,000 and $649,000 in 2025 and 2024, respectively.