Peoples Bancorp Inc. (NasdaqGS:PEBO) executed letter of intent to acquire Limestone Bancorp, Inc. (NasdaqCM:LMST) from Banc Funds Company, L.L.C., Elizabeth Park Capital Advisors, Ltd., FJ Capital Management, LLC, Patriot Financial Partners III, L.P. managed by Patriot Financial Partners, L.P. and others on August 19, 2022. Peoples Bancorp Inc. entered into an Agreement and Plan of Merger to acquire Limestone Bancorp, Inc. from Banc Funds Company, L.L.C., Elizabeth Park Capital Advisors, Ltd., FJ Capital Management, LLC, Patriot Financial Partners III, L.P. managed by Patriot Financial Partners, L.P. and others for approximately $220 million on October 24, 2022. Under the terms of the agreement, each record holder of Limestone common stock will receive 0.90 shares of Peoples common stock. Following the closing, Limestone's wholly-owned banking subsidiary, Limestone Bank, Inc., will be merged with and into Peoples' wholly-owned banking subsidiary, Peoples Bank, Inc. Limestone will pay a termination fee of $8.3 million to Peoples in case Limestone terminates the agreement.

The transaction is subject to approval by federal and state banking regulatory authorities, approval by the shareholders of Limestone and Peoples, effectiveness of the registration statement, Peoples common shares to be issued in the merger shall have been authorized for listing on the NASDAQ ? Global Select Market, holders of not more than 5% of the outstanding Limestone Common Stock shall have perfected their dissenters? rights, and certain other conditions. The transaction has been unanimously approved by the Boards of Directors of both companies. Members of the Board of Directors of Limestone and the holder of Limestone?s non-voting common stock, all of whom collectively hold approximately 19.1% of the outstanding shares of Limestone entered into a support agreement with Peoples. Limestone Bancorp?s shareholders and Peoples Bancorp's shareholders approved the merger on February 23, 2023. Shareholders also approved, in a non-binding advisory vote, the compensation payable to the Company?s named executive officers in connection with the merger and prospectus of Peoples Bancorp Inc. for the special meeting. As of April 14, 2023, Peoples Bancorp received all necessary regulatory approvals for the merger between Peoples and Limestone Bancorp, Inc. The acquisition is expected to close during the second quarter of 2023. As of April 25, 2023, the transaction is expected to close on April 30, 2023. The transaction is expected to be immediately accretive to Peoples? estimated earnings before one-time costs, with a tangible book value earn back of approximately 2.8 years (inclusive of interest rate marks), and an internal rate of return in excess of 20%.

Equiniti Trust Company acted as exchange agent to Peoples. Sanjay Patel of Raymond James & Associates, Inc. acted as financial advisor and fairness opinion provider to Peoples. Dinsmore & Shohl LLP acted as legal advisor to Peoples. Piper Sandler & Co. acted as financial advisor and fairness opinion provider to Limestone. Cynthia W. Young of Wyatt, Tarrant & Combs, LLP acted as legal advisor to Limestone. Georgeson, Inc. acted as proxy solicitor to Peoples for a fee of $10,000. Piper Sandler is acting as Limestone?s financial advisor in an amount equal to 1.15% of the aggregate purchase price which is approximately $2.4 million, contingent upon the closing of the merger, and in addition, Piper Sandler also received $300,000 from Limestone upon rendering its opinion. Peoples will pay Raymond James a transaction fee of $2 million, of which $250,000 was due and payable when Raymond James rendered its opinion and the remainder of which is contingent upon successful completion of the merger.

Peoples Bancorp Inc. completed the acquisition of Limestone Bancorp, Inc. from Banc Funds Company, L.L.C., Elizabeth Park Capital Advisors, Ltd., FJ Capital Management, LLC, Patriot Financial Partners III, L.P. managed by Patriot Financial Partners, L.P. and others on April 30, 2023. Upon closing, Limestone merged with and into Peoples, with Peoples as the surviving corporation.