RENASANT CORPORATION (NASDAQ:RNST) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.
| Entry into a Material Definitive Agreement. |
Agreement and Plan of Merger
On January17, 2017, Renasant Corporation, a Mississippi
corporation (Renasant), Renasant Bank, a Mississippi banking
corporation (Renasant Bank), Metropolitan BancGroup, Inc., a
Delaware corporation, and Metropolitan Bank, a Mississippi
banking corporation (Metropolitan), entered into an Agreement and
Plan of Merger (the Merger Agreement). On the terms and subject
to the conditions set forth in the Merger Agreement, Metropolitan
will merge with and into Renasant, with Renasant continuing as
the surviving corporation (the Merger). Immediately following the
Merger, Metropolitan Bank will merge with and into Renasant Bank,
with Renasant Bank continuing as the surviving banking
corporation. The Merger Agreement has been unanimously approved
by the Boards of Directors of each of Renasant and Metropolitan.
At the effective time of the Merger, each outstanding share of
Metropolitans common stock, par value $0.01 per share (other than
(a)any shares of Metropolitan common stock owned by Metropolitan,
Renasant or any of their respective subsidiaries, except for
shares held in trust accounts, managed accounts, mutual funds and
the like or otherwise in a fiduciary or agency capacity or as a
result of debts previously contracted, and (b)any shares as to
which appraisal rights have been exercised and maintained under
the Delaware General Corporation Law), will be converted into the
right to receive 0.6066 shares (the Exchange Ratio) of Renasant
common stock, par value $5.00 per share. Cash will be paid in
lieu of any fractional shares of Metropolitan common stock based
on the weighted average of the closing sale prices of Renasant
common stock for the 15 consecutive trading days ending on the
trading day prior to the date that the Merger is consummated.
At the effective time of the Merger, each in-the-money stock
option granted under Metropolitans equity incentive plan or
otherwise will vest in full and be converted into the right to
receive a cash payment equal to (a)the total number of shares
subject to such stock option multiplied by (b)the difference
between $25.50 and the exercise price of the option, less
applicable tax withholdings. Out-of-the-money Metropolitan stock
options outstanding at the effective time of the Merger will be
cancelled for no consideration. At the effective time of the
Merger, each outstanding restricted share of Metropolitan common
stock will fully vest and be converted into unrestricted shares
of Renasant common stock, adjusted to reflect the Exchange Ratio.
The Merger is intended to qualify as a tax-free reorganization
within the meaning of the Internal Revenue Code of 1986, as
amended.
Prior to the effective time of the Merger, Renasant and Renasant
Bank will take all appropriate actions to (a)increase the number
of directors constituting Renasants and Renasant Banks respective
board of directors by one and (b)appoint a current director of
Metropolitan and Metropolitan Bank, respectively, selected by
Renasant after consultation with Metropolitan, to Renasants and
Renasant Banks respective board of directors.
Renasant, Renasant Bank and Metropolitan and Metropolitan Bank
each have made customary representations and warranties in the
Merger Agreement, and the parties have agreed to customary
covenants, including, among other things, Metropolitans agreement
to conduct its business in the ordinary course and consistent
with past practice and prudent banking practice or as required
under the Merger Agreement and to comply with certain other
operating covenants through the consummation of the Merger. The
parties have agreed to cooperate in order to enable Renasant to
file with the Securities and Exchange Commission (the SEC) a
registration statement on Form S-4, which will include a proxy
statement/prospectus.
Subject to applicable fiduciary duties, Metropolitan has agreed
to convene a special meeting of its stockholders to consider the
approval of the Merger and the adoption of the Merger Agreement,
and its board of directors has agreed to recommend that
Metropolitan stockholders adopt the Merger Agreement and approve
the Merger.
The Merger Agreement restricts the ability of Metropolitan to
solicit proposals relating to alternative business combination
transactions, and, subject to certain exceptions, to enter into
discussions or negotiations or provide confidential information
in connection with any proposals for alternative business
combination transactions. However, prior to the special meeting
of Metropolitan stockholders, Metropolitan may engage in
negotiations or discussions with a party that has made an
unsolicited bona fide written acquisition proposal, and
may provide confidential or nonpublic information to such party,
if and only to the extent that (a)Metropolitans board of
directors concludes in good faith, after consultation with its
outside legal counsel and financial advisor (as to financial
matters), that (1)based on the information then available, such
acquisition proposal is more favorable to Metropolitans
stockholders from a financial point of view than the transactions
contemplated by the Merger Agreement and is reasonably likely to
be consummated and (2)failure to take such action would be
inconsistent with the directors fiduciary duties under applicable
law and (b)prior to providing any confidential or nonpublic
information, Metropolitan receives a confidentiality agreement
from such person on customary terms and conditions.
Prior to obtaining the approval of the stockholders of
Metropolitan regarding the Merger Agreement and the Merger,
Metropolitans board of directors may make a change of
recommendation or terminate the Merger Agreement to accept a
superior proposal if the Board determines in good faith, after
consultation with its legal counsel and financial advisors (as to
financial matters), that failure to take such action would be
inconsistent with the directors fiduciary duties under applicable
law. Prior to taking such actions, Metropolitan must give
Renasant an opportunity to match such offer.
Consummation of the Merger is subject to the adoption of the
Merger Agreement and the approval of the Merger by Metropolitan
stockholders as well as other customary conditions, such as
(a)receipt of all regulatory approvals from, among others,
various banking regulators, (b)effectiveness of the registration
statement on Form S-4 for the Renasant common stock to be issued
in the Merger, and (c)the absence of any law or order prohibiting
the consummation of the Merger or making it illegal. It is also a
condition to the parties respective obligation to consummate the
Merger that Curtis J. Gabardi, Metropolitans President and Chief
Executive Officer, enter into an employment agreement with
Renasant. Renasant is not required to consummate the Merger if
Metropolitan stockholders holding more than 5.0% of its
outstanding common stock exercise appraisal rights (and do not
withdraw or otherwise forfeit such rights). Finally, each partys
obligation to consummate the Merger is subject to certain other
conditions, including (a)the accuracy of the representations and
warranties of the other party, except (subject to limited
exceptions) where the inaccuracy would not have a material
adverse effect, (b)compliance by the other party with its
covenants in all material respects, (c)the delivery of opinions
from counsel to each of Renasant and Metropolitan relating to the
U.S. federal income tax treatment of the Merger and (d)the
approval for listing on the NASDAQ Global Select Market, subject
to notice of issuance, of the shares of Renasant common stock to
be issued in the Merger. Subject to the receipt of all required
approvals and the satisfaction of all other conditions, the
Merger is expected to be completed early in the third quarter of
2017.
The Merger Agreement also provides for termination rights of both
Renasant and Metropolitan, under specified circumstances.
Further, upon termination of the Merger Agreement under
particular circumstances set forth in the Merger Agreement and
depending on the circumstances, including the acceptance of a
superior proposal, Metropolitan may be required to pay Renasant a
termination fee in the amount of $6,800,000 and reimburse
Renasant for its costs and expenses in the amount of up to
$650,000.
The foregoing description of the Merger and the Merger Agreement
does not purport to be complete and is qualified in its entirety
by reference to the Merger Agreement, a copy of which is filed
herewith as Exhibit 2.1 and incorporated herein by reference.
Voting Agreements
In connection with the execution of the Merger Agreement, each of
the directors of Metropolitan as well as two stockholders of
Metropolitan entered into, or will enter into, voting agreements
with Renasant. Under these agreements, each director and each
such stockholder has agreed (or will agree) to vote his, her or
its shares of Metropolitan common stock in favor of the Merger
and to refrain from transferring his, her or its shares of
Metropolitan common stock prior to the vote on the Merger by
Metropolitan stockholders. Under the voting agreements,
non-employee directors of Metropolitan have also agreed (or will
agree) to certain non-competition covenants covering the two-year
period following the consummation of the Merger. A copy of the
forms of such voting agreements are included as part of the
Merger Agreement filed as Exhibit 2.1 to this Current Report on
Form 8-K.
Cautionary Statement
The foregoing summary of the Merger Agreement and other
agreements referred to above, and the copy of the Merger
Agreement and such other agreements filed as Exhibit 2.1 to this
Current Report on Form 8-K and incorporated by reference herein,
are included solely to provide investors with information
regarding the terms of the Merger Agreement and such other
agreements. They are not intended to provide factual information
about the parties or any of their respective subsidiaries or
affiliates or otherwise to serve as a source of financial,
business or operational information about Renasant or
Metropolitan. The foregoing discussion is qualified in its
entirety by reference to the Merger Agreement and the other
agreements included as a part thereof.
The Merger Agreement contains representations and warranties by
Renasant and Renasant Bank and Metropolitan and Metropolitan Bank
that were made only for purposes of the Merger Agreement and as
of specific dates. The representations, warranties and covenants
in the Merger Agreement were made solely for the benefit of the
parties to the Merger Agreement; may be subject to qualifications
and limitations agreed upon by the contracting parties, including
being qualified by confidential disclosures made for the purposes
of allocating contractual risk between the parties to the Merger
Agreement instead of establishing these matters as facts; may be
limited to the knowledge of specified officers of Renasant and
Metropolitan; and may be subject to standards of materiality
applicable to the contracting parties that differ from those
generally applicable to investors. Investors are not third-party
beneficiaries under the Merger Agreement and in reviewing the
representations, warranties and covenants contained in the Merger
Agreement or any descriptions thereof in this summary, it is
important to bear in mind that such representations, warranties
and covenants or any descriptions were not intended by the
parties to the Merger Agreement to be characterizations of the
actual state of facts or condition of Renasant, Metropolitan or
any of their respective subsidiaries or affiliates. Such
representations and warranties are not intended to amend,
supplement or supersede any statement contained in any reports or
documents filed by Renasant with the SEC. Moreover, information
concerning the subject matter of the representations, warranties
and covenants may change after the date of the Merger Agreement,
which subsequent information may or may not be fully reflected in
Renasants public disclosures. For the foregoing reasons, the
representations, warranties and covenants or any descriptions of
those provisions should not be read alone and should instead be
read in conjunction with the other information contained in the
reports, statements and filings that Renasant publicly files with
the SEC.
| Item8.01 | Other Events. |
On January18, 2017, Renasant and Metropolitan held a conference
call with interested investors and financial analysts to discuss
the Merger, which conference call was part of Renasants regular
quarterly earnings call. A transcript of the entire conference
call is filed as Exhibit 99.1 to this Current Report on Form 8-K.
On January19, 2017, Metropolitan distributed to its employees a
list of frequently asked questions regarding the Merger. This
document is filed as Exhibit 99.2 to this Current Report on Form
8-K.
Additional Information About the Renasant/Metropolitan
Transaction
This report is being made in respect of the proposed Merger
involving Renasant and Metropolitan. In connection with the
proposed Merger, Renasant intends to file a registration
statement on Form S-4 that will include a proxy statement of
Metropolitan and a prospectus of Renasant, and Renasant will file
other relevant documents concerning the proposed Merger, with the
SEC. This report does not constitute an offer to sell or the
solicitation of an offer to buy any securities. BEFORE MAKING ANY
INVESTMENT DECISION, METROPOLITAN INVESTORS ARE URGED TO READ THE
PROXY STATEMENT/PROSPECTUS AND ANY OTHER DOCUMENTS TO BE FILED
WITH THE SEC IN CONNECTION WITH THE PROPOSED MERGER OR
INCORPORATED BY REFERENCE IN THE PROXY STATEMENT/PROSPECTUS
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT RENASANT,
METROPOLITAN AND THE PROPOSED MERGER. When available, the proxy
statement/prospectus will be mailed to stockholders of
Metropolitan. Investors will also be able to obtain copies of the
proxy statement/prospectus and other relevant documents filed by
Renasant (when they become available) free of charge at the SECs
website (www.sec.gov). In addition, documents filed with the SEC
by Renasant will be available free of charge from Kevin Chapman,
Executive Vice President and Chief Financial Officer, Renasant
Corporation, 209 Troy Street, Tupelo, Mississippi 38804-4827,
telephone: (662)680-1450.
Safe Harbor Statement Under the Private Securities
Litigation Reform Act of 1995
This report contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Congress passed the Private Securities Litigation Act of 1995 in
an effort to encourage companies to provide information about
their anticipated future financial performance. This act provides
a safe harbor for such disclosure, which protects a company from
unwarranted litigation if actual results are different from
management expectations. This report reflects the current views
and estimates of future economic circumstances, industry
conditions, company performance and financial results of the
management of Renasant and Metropolitan. These forward-looking
statements are subject to a number of factors and uncertainties
which could cause Renasants, Metropolitans or the combined
companys actual results and experience to differ from the
anticipated results and expectations expressed in such
forward-looking statements, and such differences may be material.
Forward-looking statements speak only as of the date they are
made, and neither Renasant nor Metropolitan assumes
any duty to update forward-looking statements. In addition to
factors previously disclosed in Renasants reports filed with the
SEC and those identified elsewhere in this report, these
forward-looking statements include, but are not limited to,
statements about (i)the expected benefits of the transaction
between Renasant and Metropolitan, including future financial and
operating results, cost savings, enhanced revenues and the
expected market position of the combined company that may be
realized from the transaction, and (ii)Renasants and
Metropolitans plans, objectives, expectations and intentions and
other statements contained in this report that are not historical
facts. Other statements identified by words such as expects,
anticipates, intends, plans, believes, seeks, estimates, targets,
projects or words of similar meaning generally are intended to
identify forward-looking statements. These statements are based
upon the current beliefs and expectations of Renasants and
Metropolitans management and are inherently subject to
significant business, economic and competitive risks and
uncertainties, many of which are beyond their respective control.
In addition, these forward-looking statements are subject to
assumptions with respect to future business strategies and
decisions that are subject to change. Actual results may differ
from those indicated or implied in the forward-looking
statements, and such differences may be material.
The following risks, among others, could cause actual results to
differ materially from the anticipated results or other
expectations expressed in the forward-looking statements: (1)the
businesses of Renasant and Metropolitan may not be integrated
successfully or the integration may be more difficult,
time-consuming or costly than expected; (2)the expected growth
opportunities or costs savings from the transaction may not be
fully realized or may take longer to realize than expected;
(3)revenues following the transaction may be lower than expected
as a result of losses of customers or other reasons; (4)deposit
attrition, operating costs, customer loss and business disruption
following the transaction, including difficulties in maintaining
relationships with employees, may be greater than expected;
(5)governmental approvals of the transaction may not be obtained
on the proposed terms or expected timeframe; (6)Metropolitans
stockholders may fail to approve the transaction; (7)the terms of
the proposed transaction may need to be modified to satisfy such
approvals or conditions; (8)reputational risks and the reaction
of the companies customers to the transaction; (9)diversion of
management time on Merger-related issues; (10)changes in asset
quality and credit risk; (11)inflation; (12)the cost and
availability of capital; (13)customer acceptance of the combined
companys products and services; (14)customer borrowing,
repayment, investment and deposit practices; (15)the
introduction, withdrawal, success and timing of business
initiatives; (16)the impact, extent, and timing of technological
changes; (17)severe catastrophic events in the companies
respective geographic area; (18)a weakening of the economies in
which the combined company will conduct operations may adversely
affect its operating results; (19)the U.S. legal and regulatory
framework, including those associated with the Dodd-Frank Wall
Street Reform and Consumer Protection Act, could adversely affect
the operating results of the combined company; (20)the interest
rate environment may compress margins and adversely affect net
interest income; and (21)competition from other financial
services companies in the companies markets could adversely
affect operations. Additional factors that could cause Renasants
results to differ materially from those described in the
forward-looking statements can be found in Renasants reports
(such as Annual Reports on Form 10-K, Quarterly Reports on Form
10-Q and Current Reports on Form 8-K) filed with the SEC and
available at the SECs website (www.sec.gov). All subsequent
written and oral forward-looking statements concerning Renasant,
Metropolitan or the Merger or other matters and attributable to
Renasant, Metropolitan or any person acting on either of their
behalf are expressly qualified in their entirety by the
cautionary statements above. Renasant and Metropolitan do not
undertake any obligation to update any forward-looking statement,
whether written or oral, to reflect circumstances or events that
occur after the date the forward-looking statements are made.
| Item9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
|
Exhibit Number |
Description of Exhibit |
|
| 2.1 |
Agreement and Plan of Merger by and among Renasant Corporation, Renasant Bank, Metropolitan BancGroup, Inc. and Metropolitan Bank dated as of January 17, 2017* |
|
| 99.1 | Transcript of conference call held on January 18, 2017 | |
| 99.2 |
Frequently asked questions distributed to employees of Metropolitan BancGroup, Inc. |
| * |
The schedules have been omitted to Item601(b)(2) of Regulation S-K and will be provided to the SEC upon request. |
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
| RENASANT CORPORATION | ||||||
| Date: January19, 2017 | By: | /s/ E. Robinson McGraw | ||||
| E. Robinson McGraw | ||||||
| Chairman and Chief Executive Officer |
EXHIBIT INDEX
|
Exhibit Number |
Description of Exhibit |
|
| 2.1 |
Agreement and Plan of Merger by and among Renasant Corporation, Renasant Bank, Metropolitan BancGroup, Inc. and Metropolitan Bank dated as of January 17, 2017* |
|
| 99.1 | Transcript of conference call held on January 18, 2017 | |
| 99.2 |
Frequently asked questions distributed to employees of Metropolitan BancGroup, Inc. |
| * | The schedules have been omitted |
About RENASANT CORPORATION (NASDAQ:RNST)
Renasant Corporation is a bank holding company that owns and operates Renasant Bank (the Bank) and Renasant Insurance, Inc. (Renasant Insurance), a subsidiary of the Bank with operations in Mississippi. The Company operates through three segments: Community Banks segment, Insurance segment and Wealth Management segment. The Community Banks segment offers a range of banking and financial services to individuals and small to medium-sized businesses. The Insurance segment includes an insurance agency offering all lines of commercial and personal insurance through major carriers. The Wealth Management segment offers a range of fiduciary services, which includes the administration and management of trust accounts, including personal and corporate benefit accounts, self-directed individual retirement accounts (IRAs), and custodial accounts. In addition, the Wealth Management segment offers annuities, mutual funds and other investment services through a third-party broker-dealer. RENASANT CORPORATION (NASDAQ:RNST) Recent Trading Information
RENASANT CORPORATION (NASDAQ:RNST) closed its last trading session down -0.38 at 39.42 with 308,106 shares trading hands.