Section 1 – Registrant’s Business and Operations

     Item 1.01 Entry into Material Definitive Agreement.

     On December 31, 2007, Enterprise Financial Services Corp. (“Enterprise”) acquired all of the outstanding membership interests of Millennium Brokerage Group, LLC (“Millennium”), pursuant to a Membership Interest Purchase Agreement (Second Closing) (the “New Purchase Agreement”) dated December 31, 2007 by and among Enterprise, Millennium, Millennium Holding Company, Inc., a direct wholly-owned subsidiary of Enterprise (“MHC”), Millennium Holdings, LLC (“MBG Holdings”) and the other parties to the Original Purchase Agreement (as defined below).

     MHC originally acquired sixty percent of the membership interests of Millennium in October 2005 pursuant to a Membership Interest Purchase Agreement (the “Original Purchase Agreement”) dated October 13, 2005. Pursuant to the New Purchase Agreement, MHC has acquired the remaining forty percent membership interests from MBG Holdings and is now the sole member of Millennium.

     The Original Purchase Agreement provided for Enterprise’s staged acquisition of the remaining forty percent interest in Millennium at two closings, one to occur in March 2008 and the other in March 2010. The New Purchase Agreement amends the Original Purchase Agreement by providing for MHC’s immediate acquisition of the remaining forty percent interest in Millennium.

     The New Purchase Agreement also modifies the consideration specified in the Original Purchase Agreement for the remaining forty percent interest. The aggregate consideration for the remaining forty percent membership under the New Purchase Agreement interest will be between One Million Five Hundred Thousand Dollars ($1,500,000.00) and Nine Million Five Hundred Thousand Dollars ($9,500,000.00). At the closing of the New Purchase Agreement, MHC paid a down payment on the acquired membership interest to MBH Holdings in the amount of One Million Five Hundred Thousand Dollars ($1,500,000.00) in cash. The New Purchase Agreement also provides for an earnout pursuant to which Enterprise will pay MBG Holdings additional purchase consideration of up to Eight Million Dollars ($8,000,000.00) if Millennium produces minimum levels of Pre-Tax Income (as defined in the New Purchase Agreement) during 2008, 2009, 2010 and 2011. The earnout provision provides that Enterprise will pay MBG Holdings annual earnout payments of up to Two Million Dollars ($2,000,000.00) per year for each of 2008, 2009, 2010 and 2011 if Millennium achieves specified threshold levels of Pre-Tax Income in such respective years. The threshold and benchmark levels of Pre-Tax Income increase each year and the earnout payment for each year is determined based on Millennium’s performance for such year only. If the threshold earnout level for a year is not met, Enterprise will not be required to pay any additional consideration to MBG Holdings with respect to such year. All earn out payments by Enterprise will be in a combination of cash and Enterprise’s common stock, as described in Item 3.02 below.

     Under the New Purchase Agreement, certain employees of Millennium will be entitled to cash payments if Enterprise is subject to a Change of Control (as defined in the New Purchase Agreement) before December 31, 2011 and Millennium has at that time, on a cumulative basis, produced Pre-Tax Income equal to the cumulative thresholds for the earnout period through the date of the Change of Control. The aggregate change of control payments will not exceed One Million Dollars ($1,000,000.00) and each employee’s receipt of a change of control payment requires that such employee remain in the employ of the surviving company for up to three years after the Change of Control.