Item 1.01 Entry into a Material Definitive Agreement
Agreement and Plan of Merger
Merger. On
The Merger Agreement has been unanimously approved by the boards of directors of the Company and SWG. The transaction is expected to close in the second quarter of 2020, subject to customary conditions discussed below.
Merger Consideration. Pursuant to the Merger Agreement, each outstanding share of SWG common stock issued and outstanding immediately prior to the effective time of the Merger will be converted into the right to receive one (1.00) share of the Company's common stock (the "Merger Consideration"). Each share of SWG common stock subject to vesting restrictions granted under any equity plan of SWG ("SWG Restricted Shares"), or its subsidiaries, that is outstanding immediately prior to the effective time of the Merger will also automatically be converted into one (1.00) restricted share of the Company's common stock with the same vesting restrictions as were applicable to the SWG Restricted Share.
Each outstanding share of the Company's common stock shall remain outstanding and unaffected by the Merger.
Representations and Warranties. The Merger Agreement contains usual and customary representations and warranties that the Company and SWG made to each other as of specific dates.
Covenants; No Solicitation. Each party also has agreed to customary covenants, including, among others, covenants relating to the conduct of its business during the interim period between the execution of the Merger Agreement and the consummation of the Merger. Additionally, SWG has agreed (i) not to initiate, solicit, induce or knowingly encourage or take any action or facilitate any alternative acquisition transaction or, subject to certain exceptions, participate in discussions or negotiations regarding, or furnish any non-public information relating to, any alternative acquisition transaction or (ii) subject to certain exceptions, not to withdraw or modify in a manner adverse to the Company, the recommendation of the SWG board of directors that SWG's shareholders approve the Merger Agreement and the Merger. In the event that SWG receives a proposal with respect to an alternative acquisition transaction that the SWG board of directors determines is superior to the Merger, the Company will have an opportunity to match the terms of such proposal, subject to certain requirements.
Conditions to Closing. Consummation of the Merger is subject to various
customary conditions, including (i) approval of the Merger Agreement and the
Merger by shareholders of SWG; (ii) the receipt of certain regulatory approvals
and third party consents; (iii) no injunctions or other legal restraints
preventing the consummation of the Merger; (iv) the
Termination. The Merger Agreement may be terminated in certain circumstances,
including: (i) by mutual written agreement of the parties, (ii) by either party
if any regulatory approval required for consummation of the transactions
contemplated by the Merger Agreement has been denied by final non-appealable
action by the relevant governmental authority or an application for such
approval has been permanently withdrawn at the request of a governmental
authority, (iii) by either party if the approval of the shareholders of SWG is
not obtained, (iv) by either party in the event of a material breach by the
other party of any representation, warranty or covenant contained in the Merger
Agreement and such breach is not cured within thirty days, (v) by either party
if the Merger is not consummated on or before
Termination Fee. SWG will pay the Company a termination fee equal to
The foregoing summary of the Merger Agreement is not complete and is qualified in its entirety by reference to the full text of the Merger Agreement and certain exhibits attached thereto, a copy of which is attached hereto as Exhibit 2.1 and incorporated by reference herein. The assertions embodied in the representations and warranties set forth in the Merger Agreement by each party were made solely for purposes of, and were and are solely for the benefit of the parties to, the contract between the Company and SWG and may be subject to important qualifications and limitations agreed to by the parties in connection with negotiating certain terms. Moreover, certain of the representations and warranties are subject to a contractual standard of materiality that may be different from what may be viewed as material to shareholders, and the representations and warranties may have been used to allocate risk between the Company and SWG rather than establishing matters of fact. Accordingly, the representations and warranties may not describe the actual state of affairs at the date they were made or at any other time, and shareholders should not rely on them as statements of fact. In addition, such representations and warranties (i) will not survive consummation of the Merger, unless otherwise specified in the Merger Agreement, and (ii) were made only as of the date of the Merger Agreement or such other date as is specified in the Merger Agreement. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in the parties' public disclosures. Accordingly, the Merger Agreement is included with this filing only to provide shareholders with information regarding the terms of the Merger Agreement, and not to provide shareholders with any other factual information regarding the Company or SWG, their respective affiliates or their respective businesses. The . . .
Item 8.01 Other Events
On
Cautionary Statements Regarding Forward-Looking Information.
This Current Report contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. In general, forward-looking statements usually use words such as "may," "believe," "expect," "anticipate," "intend," "will," "should," "plan," "estimate," "predict," "continue" and "potential" or the negative of these terms or other comparable terminology, including statements related to the expected timing of the closing of the Merger, the expected returns and other benefits of the Merger, to shareholders, expected improvement in operating efficiency resulting from the Merger, estimated expense reductions resulting from the transactions and the timing of achievement of such reductions, the impact on and timing of the recovery of the impact on tangible book value, and the effect of the Merger on the Company's capital ratios. Forward-looking statements represent management's beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements.
Factors that could cause or contribute to such differences include, but are not
limited to (1) the risk that the cost savings and any revenue synergies from the
Merger may not be realized or take longer than anticipated to be realized,
(2) disruption from the Merger with customers, suppliers, employee or other
business partners relationships, (3) the occurrence of any event, change or
other circumstances that could give rise to the termination of the Merger
Agreement, (4) the risk of successful integration of SWG's business into the
Company, (5) the failure to obtain the necessary approval by the shareholders of
SWG, (6) the amount of the costs, fees, expenses and charges related to the
Merger, (7) the ability by the Company to obtain required governmental approvals
of the Merger, (8) reputational risk and the reaction of each of the companies'
customers, suppliers, employees or other business partners to the Merger,
(9) the failure of the closing conditions in the Merger Agreement to be
satisfied, or any unexpected delay in closing of the Merger, (10) the risk that
the integration of SWG's operations into the operations of the Company will be
materially delayed or will be more costly or difficult than expected, (11) the
possibility that the Merger may be more expensive to complete than anticipated,
including as a result of unexpected factors or events, (12) the dilution caused
by the Company's issuance of additional shares of its common stock in the Merger
transaction, and (13) general competitive, economic, political and market
conditions. Additional factors which could affect the forward looking statements
can be found in the cautionary language included under the headings
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Risk Factors" in the Company's Annual Report on Form 10-K for
the year ended
Additional Information about the Merger and Where to Find It
This document does not constitute an offer to sell or the solicitation of an
offer to buy any securities, or a solicitation of any vote or approval, nor
shall there be any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such jurisdiction. In connection with the
proposed Merger, the Company will file with the
Participants in the Transaction
The Company, SWG and certain of their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies from
the shareholders of SWG in connection with the proposed transaction. Certain
information regarding the interests of these participants and a description of
their direct and indirect interests, by security holdings or otherwise, will be
included in the proxy statement/prospectus regarding the proposed transaction
when it becomes available. Additional information about the Company and its
directors and officers may be found in the definitive proxy statement of the
Company relating to its 2019 Annual Meeting of Stockholders filed with the
Item 9.01 Financial Statements and Exhibits
(d) EXHIBITS 2.1 Agreement and Plan of Merger, datedDecember 18, 2019 , by and betweenThe First Bancshares, Inc. and Southwest Georgia Financial Corporation 99.1 Press Release datedDecember 18, 2019 99.2 Investor Presentation datedDecember 18, 2019
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