Blue Hill Advisors and Investors Reaffirm Commitment to Territorial Transaction; Will Stand by Offer if Hope Deal Terminates

Reiterate Desire to Engage Directly with the Board, Not in a Public Fight

Commit to Completing Transaction on the Same Proposed Terms if Sale to Hope Terminates

Urge Territorial Shareholders to Vote AGAINST Hope Sale Again at the Adjourned Special Meeting of Stockholders on November 6, 2024

News Release from Blue Hill Advisors, Oct 17, 2024

HONOLULU, Oct. 17, 2024 /PRNewswire/ -- Former Hawaii banking executive Allan Landon, Blue Hill Advisors and other leading bank investors today reaffirmed their commitment to successfully completing a transaction with Territorial Bancorp Inc. ("Territorial" or the "Company") (NASDAQ: TBNK) and clarified their intent to stand by their offer if shareholders vote down the proposed sale to Hope Bancorp, Inc. ("Hope") (NASDAQ: HOPE) at the adjourned Special Meeting of Stockholders on November 6.

Mr. Landon and the investors, which also include O'Brien-Staley Partners and veteran bank investor Mark Lynch, have favored a collaborative approach with Territorial's Board of Directors (the "Board"). However, the Board has rejected multiple requests by the investors to engage in direct discussions. In the event that the sale to Hope terminates, Mr. Landon and the investors stand ready to speak with the Board in November and to diligently execute the proposed cash transaction on the current terms shortly thereafter.

"Our goal all along has been to engage in constructive dialogue with Territorial about this superior offer for shareholders, employees, customers and the Hawaii community," said Mr. Landon.  "We look forward to that opportunity, even if it has to come after the adjourned special meeting. We intend to offer the same terms then as we are offering now."

The investors urge Territorial shareholders not to be distracted by the numerous letters, presentations and press releases put out by Territorial's Board and advisors over the last few weeks. Instead, they encourage shareholders to focus on five simple points:

The Board's sale process was flawed. The Board struck a deal with Hope near the stock's all-time-low price, after a nearly 70% decline and a limited sales process involving only two other potential buyers. Shares of Territorial have consistently traded at a premium to the implied value of the Hope merger consideration since the investors made their proposal public, reflecting shareholder expectations for a better transaction.

The investors believe that their offer is reasonably likely to be considered a superior proposal. The investors' $12.50 cash proposal represents a substantial premium to the current value of the Hope merger consideration and offers up to 30% of Territorial shareholders (and potentially more depending on shareholder and Board feedback) the opportunity to participate in Territorial's recovery. Meanwhile, the Board approved a sale that values Territorial at the second lowest bank sale multiple in recorded history.

The Board continues to reject requests to discuss the investors' proposal. Mr. Landon and the investors have repeatedly offered to work collaboratively with the Board and share more information about their proposal. The investors are not interested in perpetuating a public back-and-forth or subjecting themselves to Territorial's misleading assertions.

Territorial's prospects have improved dramatically. Since the sale to Hope was announced in April 2024, the banking sector has rallied on the expectation of lower interest rates, which would disproportionately benefit Territorial via repricing of its higher cost wholesale funding. There is simply no reason for shareholders to accept a sale that values Territorial at the second lowest bank sale multiple on record.

A leading independent proxy advisory firm has recommended voting against the sale to Hope. Institutional Shareholder Services Inc. ("ISS") has recommended that shareholders vote AGAINST the Hope deal. The deal terms on which that recommendation was based have not changed. In its report, ISS noted that "the competing offer from Blue Hill appears sufficiently credible to mitigate the downside risk of rejecting the proposed merger" and that the Hope deal "does not appear to maximize value for shareholders."

More information on the investor proposal can be found at www.NewTerritorial.com and in a presentation titled, "A Better Deal for Territorial".

Territorial shareholders are encouraged to contact Blue Hill Advisors for more information or to contact Territorial's Board to express their support for this proposal. Shareholders who have already voted FOR the Hope merger but who wish to change their vote can still do so before the November 6 special meeting of Territorial stockholders by following the instructions for changing votes as described in the prospectus that Hope filed with the U.S. Securities and Exchange Commission (the "SEC") on August 22, 2024.

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Oct 7 2024: UPDATE: Territorial Bank Postpones Merger Vote