Texas Capital Bancshares, Inc. (NasdaqGS:TCBI) entered into a definitive agreement to acquire Independent Bank Group, Inc. (NasdaqGS:IBTX) from Vincent J. Viola and others in a reverse merger transaction on December 9, 2019. Under the terms of the merger agreement, Texas Capital shareholders will receive 1.0311 shares of Independent Bank Group for each Texas Capital share they own. In the merger, each share of Texas Capital series A preferred stock issued and outstanding immediately prior to the effective time will be converted into the right to receive one share of Independent Bank series B preferred stock. At the effective time, except as otherwise agreed by Independent Bank and Texas Capital, each outstanding Texas Capital restricted stock award, RSUs and PSUs will, automatically and without any required action on the part of the holder thereof, immediately and fully vest and be converted into the right to receive the merger consideration. Former Texas Capital shareholders will own 55% and Independent Bank Group shareholders will own 45% of the combined company. Texas Capital Bancshares and Independent Bank Group will combine in an all-stock merger of equals transaction, with Texas Capital Bancshares being the accounting acquirer. The combined holding company name will be Independent Bank Group and the name of the combined bank will be Texas Capital. Retail locations in Colorado will continue to operate and retain the Independent Financial branding. The corporate headquarters of the combined company will be located in McKinney, Texas. The combined company will trade under the Independent Bank Group ticker symbol “IBTX” on The Nasdaq Stock Market. In the event of termination, a termination fee of $115 million will be payable by either Independent Bank Group, Inc. or Texas Capital Bancshares, Inc., as applicable.

The Chairman, President and Chief Executive Officer of the combined company will be David Brooks. C. Keith Cargill will serve as Special Advisor to the Chairman, President and Chief Executive Officer. Julie Anderson will be the Chief Financial Officer. The leadership team led by David Brooks will include five current Texas Capital executives and four current Independent Bank Group executives. The Board of Directors will be composed of seven Directors from Texas Capital namely Larry L. Helm, James H. Browning, David S. Huntley, Charles S. Hyle, Robert W. Stallings, Dale W. Tremblay and Patricia A. Watson, and, six directors from Independent Bank Group namely David R. Brooks, William E. Fair, J. Webb Jennings III, Alicia K. Harrison, G. Stacy Smith and Michael T. Viola. Larry L. Helm, Texas Capital Non-Executive Chairman of the Texas Capital Board, will serve as Lead Independent Director of the combined company's Board of Directors. The leadership team of the combined company will also include John G. Turpen.

The transaction is subject to satisfaction of customary closing conditions, including receipt of customary regulatory approvals including the approval of the Federal Reserve Board, the Federal Deposit Insurance Corporation and the Texas Department of Banking, approval by the shareholders of both Texas Capital Bancshares and Independent Bank Group, the merger must qualify as a reorganization within the meaning of section 368(a) of the Code, authorization for listing on the NASDAQ Stock Market, Inc. Global Select Market System of the shares of Independent Bank Group, Inc. Common Stock and New Independent Bank Group, Inc. Preferred Stock to be issued in the merger, subject to official notice of issuance, effectiveness of the registration statement on Form S-4 for the IBTX Common Stock and New IBTX Preferred Stock to be issued in the Merger, among others. The transaction has been unanimously approved by the Boards of Directors of both Texas Capital Bancshares and Independent Bank Group. The transaction is expected to close in mid-2020. As of April 23, 2020, the transaction is expected to close in August 2020. The transaction is expected to deliver approximately 27% tangible book value per share (TBVPS) accretion, 26% EPS accretion to Independent Bank Group, 14% EPS accretion to Texas Capital by the first full year after close and immediately accretive to TBVPS earn-back period.

Aaron Packles of Jefferies LLC and Michael P. Esposito, Ken Coquillette and Eric Neveux of Goldman Sachs & Co. LLC acted as financial advisors and H. Rodgin Cohen, Mitchell S. Eitel, Marc Treviño, Davis Wang, Rebecca S. Coccaro, Mark Schenkel and Mehdi Ansari of Sullivan & Cromwell LLP acted as the legal advisors to Texas Capital. Philip Richter of Fried, Frank, Harris, Shriver & Jacobson LLP acted as legal advisor to Goldman Sachs & Co. LLC. Joseph Gulash of Keefe, Bruyette & Woods acted as the exclusive financial advisor to Independent Bank Group and provided fairness opinion to Board of Independent Bank Group. Sandler O'Neill + Partners, L.P acted as financial advisor and rendered a fairness opinion to the Board of Directors of Independent Bank Group. Edward D. Herlihy, Jacob A. Kling, and Richard K. Kim of Wachtell, Lipton, Rosen & Katz acted as the legal advisors to Independent Bank Group. KPMG acted as the due diligence advisor to both Texas Capital Bancshares and Independent Bank Group. Steven Seidman and Mark Holdsworth of Willkie Farr & Gallagher acted as legal advisors to Texas Capital President and Chief Executive Officer C. Keith Cargill in the transaction. Innisfree M&A acted as the information agent to Independent Bank and Texas Capital. Texas Capital agreed to pay Jefferies for its financial advisory services an amount of approximately $26.5 million, of which a portion was payable upon delivery of Jefferies' opinion to the TCBI board of directors and approximately $20 million is payable contingent upon consummation of the merger. Texas Capital will pay Goldman Sachs a fee of approximately $7.19 million, $1.25 million of which became payable upon the execution of the merger agreement, and the remainder of which is payable contingent upon completion of the proposed merger. Independent Bank has agreed to pay Keefe, Bruyette & Woods a total cash fee equal to 0.85% of the aggregate merger consideration, $2.5 million of which became payable to Keefe, Bruyette & Woods concurrently with the execution of the merger agreement and the balance of which is contingent upon the consummation of the merger. Piper Sandler received a fee for rendering its opinion in an amount equal to $2 million.