Berkshire Hills and First Choice Bank signed a definitive merger agreement under which First Choice Bank will merge into Berkshire Bank, and its subsidiary, First Choice Loan Services, will become a subsidiary of Berkshire Bank in an all-stock transaction valued at approximately $111.7 million.

Berkshire’s total assets will increase to $8.9 billion including the $1.1 billion in acquired First Choice assets. This market-expanding merger provides entry into attractive markets with strong demographics, and includes six branches near Princeton, NJ and two in the greater Philadelphia area.

First Choice reported $436 million in net loans (excluding loans held for sale) and $906 million in deposits as of March 31, 2016. First Choice Bank is the second largest community bank by deposit market share in Mercer County, NJ.

Berkshire will have a pro forma market cap of approximately $905 million and 101 branches, serving customers and communities across the Northeast.

Under the terms of the merger agreement, each outstanding share of First Choice common stock, (including First Choice preferred stock, which will be treated as if it were exchanged to First Choice common stock prior to completing the transaction), will be exchanged for 0.5773 shares of Berkshire Hills common stock. Immediately prior to closing the merger, First Choice may pay a per share dividend of up to 35% of any core earnings above and beyond a $14.22 tangible book value per share.

After the transaction is completed, First Choice Bank’s Chairman of the Board Martin Tuchman, along with board member Munish Sood, will serve as advisors to Berkshire and liaisons to the local community.

“We’re pleased to announce this combination with Berkshire and believe our customers, community and employees will benefit greatly from this transaction,” Tuchman said. “We believe Berkshire fits both the culture of our bank and our expanding mortgage operation. Their product suite and commitment to service will enable the combined company to better compete in this growing marketplace.”

Berkshire Hills was advised by Sandler O’Neill & Partners. Legal counsel was provided by Luse Gorman. PC First Choice was advised by Houlihan Lokey, the Ambassador Financial Group provided a fairness opinion and legal counsel was provided by Pepper Hamilton.