8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): September 3, 2021

NICOLET BANKSHARES, INC.

(Exact name of registrant as specified in its charter)

Wisconsin	001-37700	47-0871001
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

111 North Washington Street

Green Bay, Wisconsin 54301

(Address of principal executive offices)

(920) 430-1400

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01 per share	NCBS	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter.)

Emerging Growth Company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Introductory Note

On September 3, 2021, Nicolet Bankshares, Inc. (the “Company” or “Nicolet”) completed its merger (the “Merger”) with Mackinac Financial Corporation (“Mackinac”), pursuant to the terms of the Agreement and Plan of Merger, dated April 12, 2021, by and between Nicolet and Mackinac (the “Merger Agreement”). At closing, Mackinac merged with and into Nicolet, with Nicolet surviving the Merger. Immediately following the Merger, Mackinac’s wholly owned bank subsidiary, mBank, merged with and into Nicolet’s wholly owned bank subsidiary, Nicolet National Bank (the “Bank”) pursuant to the terms of a Plan of Merger (the “Bank Plan of Merger”) by and between the Bank and mBank (the “Bank Merger”).

Pursuant to the terms and conditions set forth in the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of Mackinac common stock issued and outstanding immediately prior to the Effective Time was converted into the right to receive 0.22 shares of Nicolet common stock and $4.64 in cash (approximating a 20% cash and 80% stock merger consideration split). Each holder of Mackinac common stock converted pursuant to the Merger who would otherwise have been entitled to receive a fraction of a share of Nicolet common stock (after taking into account all shares held by such holder) will instead receive cash (without interest) in lieu of such fractional share in accordance with the terms of the Merger Agreement.

As a result of the Merger, Nicolet is issuing approximately 2.3 million shares of Nicolet common stock, valued at $76.74 per share based on the closing price of Nicolet’s common stock on the Nasdaq Capital Market on September 2, 2021, the last trading day prior to the consummation of the Merger, and paying approximately $50 million in cash. The value of the total merger consideration was approximately $230 million.

The foregoing summary of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of the Merger Agreement, which is included as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 2.01 Completion of Acquisition or Disposition of Assets

The information set forth in the Introductory Note to this Current Report on Form 8-K is incorporated by reference in its entirety.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Effective immediately upon the consummation of the Merger on September 3, 2021, and in accordance with the terms of the Merger Agreement, the Nicolet Board of Directors increased the size of the board by one member and appointed Paul D. Tobias, a former member of the Mackinac board of directors, to fill the vacancy created by this increase. Mr. Tobias was not selected as a director of Nicolet pursuant to any other arrangement or understanding with any other persons.

Effective immediately upon the consummation of the Merger on September 3, 2021, and in accordance with the terms of the Merger Agreement and the Bank Plan of Merger, the Bank Board of Directors increased the size of the board by one member and appointed Mr. Tobias to fill the vacancy created by this increase.

Item 8.01 Other Events

On September 7, 2021, the Company issued a press release announcing the completion of the Merger with Mackinac, as well as, the planned consolidation or closure of fifteen branch locations and the Bank’s agreement to sell its Birmingham, Michigan branch to Bank of Ann Arbor. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(a) Financial statements of businesses acquired

The audited consolidated financial statements of Mackinac as of and for the year ended December 31, 2020, and the related notes thereto and report of the independent auditor thereon, are included in Appendix D to the joint proxy statement-prospectus dated August 26, 2021, filed by the Company with the SEC on August 27, 2021 pursuant to Rule 424(b)(3) of the Securities Act with respect to the Company’s proposed merger with County Bancorp, Inc. (the “County Joint Proxy Statement-Prospectus”), beginning on page D-34, which Appendix D is included as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.

The unaudited consolidated financial statements of Mackinac as of and for the six months ended June 30, 2021, and the related notes thereto, are included in Appendix D to the County Joint Proxy Statement-Prospectus, beginning on page D-1, which Appendix D is included as Exhibit 99.3 to this Current Report on Form 8-K and is incorporated herein by reference.

(b) Pro forma financial information

The unaudited pro forma condensed combined financial information of the Company and Mackinac as of and for the year ended December 31, 2020, and as of and for the six months ended June 30, 2021, is included as Exhibit 99.4 to this Current Report on Form 8-K and is incorporated herein by reference.

(d) Exhibits

Exhibit No.	Description of Exhibit
2.1	Agreement and Plan of Merger by and between Nicolet Bankshares, Inc. and Mackinac Financial Corporation dated April 12, 2021 (incorporated by reference to the Current Report on Form 8-K filed by Nicolet on April 12, 2021).
23.1	Consent of Plante & Moran, PLLC
99.1	Press Release dated September 7, 2021
99.2	Audited consolidated financial statements of Mackinac Financial Corporation as of and for the year ended December 31, 2020, including the notes related thereto and the report of Plante & Moran, PLLC (incorporated by reference to Appendix D of the County Joint Proxy Statement-Prospectus (Registration No. 333-258651) filed by Nicolet with the SEC on August 27, 2021).
99.3	Unaudited consolidated financial statements of Mackinac Financial Corporation as of and for the six months ended June 30, 2021, and the notes related thereto (incorporated by reference to Appendix D of the County Joint Proxy Statement-Prospectus (Registration No. 333-258651) filed by Nicolet with the SEC on August 27, 2021).
99.4	Unaudited pro forma condensed combined financial information of Nicolet Bankshares, Inc. as of and for the six months ended June 30, 2021 and for the year ended December 31, 2020
104	Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

Signatures

Pursuant 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.

Date:	September 7, 2021	NICOLET BANKSHARES, INC.
		By:	/s/ H. Phillip Moore, Jr.
			H. Phillip Moore, Jr.
			Chief Financial Officer

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the following Registration Statements:

Registration Statement (Form S-8 No. 333-188853)

Registration Statement (Form S-8 No. 333-188856)

Registration Statement (Form S-8 No. 333-188857)

Registration Statement (Form S-8 No. 333-188858)

Registration Statement (Form S-8 No. 333-208192)

Registration Statement (Form S-8 No. 333-213734)

Registration Statement (Form S-8 No. 333-225180)

Registration Statement (Form S-8 No. 333-231638)

of our report dated March 11, 2021, with respect to the financial statements of Mackinac Financial Corporation as of December 31, 2020 and 2019, and for each of the years in the two-year period ended December 31, 2020.

Grand Rapids, Michigan

September 7, 2021

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Nicolet Bankshares, Inc. Announces Branch Optimization Strategy To Better Align With Customer Actions

Nicolet announces reduction in branch locations, agreement to sell Birmingham, Michigan location to Bank of Ann Arbor, and completion of mBank acquisition

GREEN BAY, WI, September 7, 2021 – Nicolet Bankshares, Inc. (NASDAQ: NCBS) (“Nicolet”) announced today that it intends to reduce its total number of locations with the consolidation or closure of fifteen branches, as well as the sale of its Birmingham, Michigan location. The branches that will consolidate or close are: In Wisconsin – Dorchester, Mosinee, Rib Lake, St. Germain, Three Lakes, Aurora, Florence, and Eagle River. In Michigan – Menominee, Alanson, Kaleva, Mio, West Ishpeming, Negaunee, and Marquette (McClellan Ave).

Nicolet has notified employees in the affected branches, and customer notification letters are expected to be issued this week. The branches are anticipated to close on December 10, 2021.

Mike Daniels, President and CEO of Nicolet said, “As we stated in the mBank merger announcement, customers continue to tell and show us that convenience no longer means a branch on every corner. Convenience is being redefined as a seamless, frictionless experience through all channels. While we still view the branch system as an effective way to serve our customers, we also recognize the need to continue our investments in digital channels. We intend to find the right balance of investing in traditional branch channels and non-branch channels. This announcement is a logical and thoughtful action to find that balance.”

Daniels continued, “For the last twenty years, the value that Nicolet brings to communities is great people who believe strongly in our purpose to serve. Our value has never been our locations but our people and our purpose. We will continue to deliver a great customer experience.”

“This decision was made after many conversations and looking at all alternatives,” said Eric Witczak, Executive Vice President, Nicolet National Bank. “In most cases, we will have a branch nearby. In all cases, we will be able to serve our customers digitally, via online or mobile banking. We will make every effort to retain our customers and show them that we can still serve them.”

In addition, Nicolet announced that its wholly owned banking subsidiary, Nicolet National Bank, has entered into a definitive purchase and assumption agreement to sell its Birmingham, Michigan branch, including legacy mBank’s asset-based lending team, to Bank of Ann Arbor. As of August 31, 2021, the Birmingham location had total loans of approximately $176 million and total deposits of approximately $57 million. Completion of the branch sale remains subject to regulatory approval and other customary closing conditions contained in the purchase and assumption agreement.

Also, on September 3, 2021, Nicolet completed its merger with Mackinac Financial Corporation (“Mackinac”), as a result of which Mackinac merged with and into Nicolet, with Nicolet continuing as the surviving corporation. Immediately following the merger, Mackinac’s wholly owned bank subsidiary, mBank, was merged with and into Nicolet National Bank. Based on financial data of June 30, 2021, the combined company has total consolidated assets of approximately $6.1 billion.

About Nicolet Bankshares, Inc.

Nicolet Bankshares, Inc. is the bank holding company of Nicolet National Bank, a growing, full-service, community bank providing services ranging from commercial and consumer banking to wealth management and retirement plan services. Founded in Green Bay in 2000, Nicolet National Bank operates branches in Northeast and Central Wisconsin and the upper peninsula of Michigan. More information can be found at www.nicoletbank.com.

Forward Looking Statements “Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995

Certain statements contained in this communication, which are not statements of historical fact, constitute forward-looking statements within the meaning of the federal securities law. Such statements include, but are not limited to, statements about Nicolet’s business plans, objectives, expectations and intentions, including without limitation statements regarding Nicolet’s branch optimization strategy, including the timing of anticipated branch closures, and Nicolet National Bank’s sale of its Birmingham, Michigan branch, all of which are subject to numerous assumptions, risks and uncertainties. Words or phrases such as “anticipate,” “believe,” “aim,” “can,” “conclude,” “continue,” “could,” “estimate,” “expect,” “foresee,” “goal,” “intend,” “may,” “might,” “outlook,” “possible,” “plan,” “predict,” “project,” “potential,” “seek,” “should,” “target,” “will,” “will likely,” “would,” or the negative of these terms or other comparable terminology, as well as similar expressions, are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements are not historical facts but instead express only management’s beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management’s control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. In addition to factors disclosed in reports filed by Nicolet with the SEC, risks and uncertainties that may cause actual results or outcomes to differ materially from those anticipated include, but are not limited to: the possibility that the anticipated benefits of the branch optimization strategy will not be realized or that Nicolet National Bank will be unable to complete the sale of its Birmingham, Michigan branch; the magnitude and duration of the COVID pandemic and its impact on the global economy and financial market conditions and the business, results of operations and financial condition of Nicolet; and general competitive,

economic, political and market conditions and fluctuations. Please refer to Nicolet’s Annual Report on Form 10-K for the year ended December 31, 2020, as well as its other filings with the SEC, for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.

The COVID pandemic is adversely affecting us, our customers, counterparties, employees, and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions or turbulence in domestic financial markets could adversely affect Nicolet’s revenues and the values of its assets and liabilities, lead to a tightening of credit, and increase stock price volatility. In addition, the COVID pandemic may result in changes to statutes, regulations, or regulatory policies or practices that could affect Nicolet in substantial and unpredictable ways.

All forward-looking statements included in this communication are made as of the date hereof and are based on information available to management at that time. Except as required by law, Nicolet does not assume any obligation to update any forward-looking statement to reflect events or circumstances that occur after the date the forward-looking statements were made.

Investor Relations & Media Contacts:

Mike Daniels – President & CEO

Jeff Gahnz – Marketing & Public Relations

Eric Radzak – Investor Relations

Phone: 920.430.1400

Email: mdaniels@nicoletbank.com - jgahnz@nicoletbank.com - eradzak@nicoletbank.com

EX-99.4

Exhibit 99.4

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following unaudited pro forma condensed combined financial information and accompanying notes show the impact on the historical financial conditions and results of operations of Nicolet and Mackinac and have been prepared to illustrate the effects of the Mackinac merger under the acquisition method of accounting.

The unaudited pro forma condensed combined balance sheet as of June 30, 2021 and unaudited pro forma combined statements of income for the six months ended June 30, 2021 and for the year ended December 31, 2020, have been prepared to reflect the merger of Nicolet and Mackinac, after giving effect to the adjustments described in the notes to the pro forma condensed combined financial information. In the merger, Mackinac common shareholders, in exchange for the shares of Mackinac common stock held immediately prior to the merger (other than certain cancelled shares), have the right to receive total consideration of approximately $50 million in cash and an aggregate of approximately 2.3 million shares of Nicolet common stock, subject to adjustments as described herein, having an estimated aggregate value of approximately $180 million (based on the closing price of Nicolet common stock of $76.74 on September 2, 2021), representing an aggregate purchase price of approximately $230 million.

The merger will be accounted for as an acquisition transaction. Under the acquisition method of accounting, Nicolet records the assets and liabilities of the acquired entity at its fair value on the closing date of the merger. The pro forma condensed consolidated balance sheet as of June 30, 2021 has been prepared based on the historical consolidated balance sheets of Nicolet and Mackinac, assuming the transaction was consummated on June 30, 2021. The pro forma condensed combined statements of income for the six months ended June 30, 2021 and for the year ended December 31, 2020 have been prepared based on the historical consolidated statements of income for Nicolet and Mackinac, assuming the transaction was consummated on January 1, 2020.

The selected unaudited pro forma condensed consolidated financial information is presented for illustrative purposes only and does not indicate either the operating results that would have occurred had the merger been consummated as of the date indicated, or future results of operations or financial condition. The selected unaudited pro forma condensed combined financial information is based upon assumptions and adjustments that Nicolet believes are reasonable. Only such adjustments as have been noted in the accompanying notes have been applied in order to give effect to the merger transaction. Such assumptions and adjustments are subject to change as future events materialize and fair value estimates are refined.

The unaudited pro forma condensed combined and fully combined consolidated financial information should be read in conjunction with:

•the accompanying notes to the unaudited pro forma condensed combined financial information;

•Nicolet’s Annual Report on Form 10-K for the year ended December 31, 2020, and its Form 10-Q for the quarterly periods ended March 31, 2021, and June 30, 2021;

•Mackinac’s unaudited consolidated financial statements and accompanying notes as of and for the six months ended June 30, 2021, included in Mackinac’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021; and

•Mackinac’s audited consolidated financial statements and accompanying notes as of and for the year ended December 31, 2020, included in Mackinac’s Annual Report on Form 10-K for the year ended December 31, 2020.

NICOLET BANKSHARES, INC.

COMBINED WITH MACKINAC FINANCIAL CORPORATION

PRO FORMA CONDENSED COMBINED BALANCE SHEET (Unaudited)

As of June 30, 2021

(In thousands)	Historical				Pro Forma Adjustments			Nicolet and Mackinac Pro Forma Combined
	Nicolet		Mackinac
Cash and cash equivalents, including certificates of deposits in other banks	$	815,793	$	353,904	$	(49,295)	A,B	$	1,120,402
Investment securities, including equity securities	571,144		101,955		(593)			672,506
Loans held for sale	11,235		1,535					12,770
Loans	2,820,331		976,520		(7,387)		C	3,789,464
Allowance for credit losses	(32,561)		(5,651)		(14,146)		D	(52,358)
Other real estate owned, net	2,895		1,343		(664)		E	3,574
Bank owned life insurance	84,347		15,658					100,005
Goodwill	163,151		19,574		78,366		F	261,091
Core deposit intangible	10,560		4,031		769		G	15,360
Other assets	140,452		50,083		5,019		H	195,554
Total Assets	$	4,587,347	$	1,518,952	$	12,069		$	6,118,368
Deposits	$	3,939,022	$	1,307,154	$	500	I	$	5,246,676
Short-term borrowings	—		—		—			—
Long-term borrowings	45,108		28,441		100		I	73,649
Other liabilities	43,822		11,438		14,600		J	69,860
Total Liabilities	4,027,952		1,347,033		15,200			5,390,185
Common stock & Additional paid-in capital	261,194		127,624		51,738		A,K	440,556
Retained earnings	289,475		43,189		(53,763)		A,K	278,901
Accumulated other comprehensive income	8,726		1,106		(1,106)		K	8,726
Total Stockholders’ Equity (Common)	559,395		171,919		(3,131)			728,183
Total Liabilities and Stockholders’ Equity	$	4,587,347	$	1,518,952	$	12,069		$	6,118,368
Outstanding shares	9,843		10,550		2,337		A	12,180

See accompanying Notes to the Unaudited Pro Forma Condensed Combined Financial Information.

NICOLET BANKSHARES, INC.

COMBINED WITH MACKINAC FINANCIAL CORPORATION

PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME (Unaudited)

(In thousands, except per share data)	Six Months Ended June 30, 2021				Pro Forma Adjustments			Nicolet and Mackinac Pro Forma Combined
	Nicolet		Mackinac
Interest income	$	75,183	$	29,081	$	1,230	A	$	105,494
Interest expense	5,971		2,037		(100)		B	7,908
Net interest income	69,212		27,044		1,330			97,586
Provision for credit losses	500		100		—			600
Noninterest income	37,304		4,822					42,126
Noninterest expense	56,828		23,760		56		D	80,644
Income before income tax expense	49,188		8,006		1,274			58,468
Income tax expense	12,665		1,181		319		F	14,165
Net income	$	36,523	$	6,825	$	955		$	44,303
Weighted average common shares outstanding
Basic	9,949		10,537		2,337		G	12,286
Diluted	10,365		10,583		2,337		G	12,702
Earnings per common share
Basic	$	3.67	$	0.65				$	3.61
Diluted	$	3.52	$	0.65				$	3.49

(In thousands, except per share data)	Year Ended December 31, 2020				Pro Forma Adjustments			Nicolet and Mackinac Pro Forma Combined
	Nicolet		Mackinac
Interest income	$	149,202	$	62,029	$	1,876	A	$	213,107
Interest expense	19,864		7,223		(200)		B	26,887
Net interest income	129,338		54,806		2,076			186,220
Provision for credit losses	10,300		1,000		13,892		C	25,192
Noninterest income	62,626		10,199		—			72,825
Noninterest expense	100,719		46,949		20,198		D,E	167,866
Income before income tax expense	80,945		17,056		(32,014)			65,987
Income tax expense	20,476		3,583		(8,004)		F	16,055
Net income	60,469		13,473		(24,010)			49,932
Less: Net income attributable to noncontrolling interest	347		—					347
Net income attributable to Nicolet	$	60,122	$	13,473	$	(24,010)		$	49,585
Weighted average common shares outstanding
Basic	10,337		10,580		2,337		G	12,674
Diluted	10,541		10,580		2,337		G	12,878
Earnings per common share
Basic	$	5.82	$	1.27				$	3.91
Diluted	$	5.70	$	1.27				$	3.85

See accompanying Notes to the Unaudited Pro Forma Condensed Combined Financial Information.

NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

Note 1. Basis of Presentation

The accompanying unaudited pro form condensed combined financial information and related notes were prepared in accordance with Article 11 of Regulation S-X.The unaudited pro forma condensed combined income statement for the six months ended June 30, 2021, and for the year ended December 31, 2020, combine the historical consolidated statements of income of Nicolet and Mackinac, giving effect to the merger as if it had been completed

on January 1, 2020.The accompanying unaudited pro forma condensed combined balance sheet as of June 30, 2021 combines the historical consolidated balance sheets of Nicolet and Mackinac, giving effect to the merger as if it had been completed on June 30, 2021.

The unaudited pro forma condensed combined financial information and explanatory notes have been prepared to illustrate the effects of the merger involving Nicolet and Mackinac under the acquisition method of accounting with Nicolet treated as the acquirer.The unaudited pro forma condensed combined financial information is presented for illustrative purposes only and does not necessarily indicate the financial results of the combined company had the companies actually been combined at the beginning of each period presented, nor does it necessarily indicate the results of operations in future periods or the future financial position of the combined company.Under the acquisition method of accounting, the assets and liabilities of Mackinac, as of the effective time of the merger, will be recorded by Nicolet at their respective fair values, and the excess of the merger consideration over the fair value of the net assets acquired will be allocated to goodwill.

The merger provides for Mackinac common shareholders, in exchange for the shares of Mackinac common stock held immediately prior to the merger, to receive total consideration of approximately $50 million in cash and an aggregate of approximately 2.3 million shares of Nicolet common stock, subject to adjustments as described herein, having an estimated aggregate value of approximately $180 million (based on the closing price of Nicolet common stock of $76.74 on September 2, 2021), representing an aggregate purchase price of approximately $230 million.

The pro forma allocation of the purchase price reflected in the unaudited pro forma condensed combined financial information is subject to adjustment. For purposes of the unaudited pro forma condensed combined balance sheet, the purchase price consideration has been allocated to the assets acquired and liabilities assumed of Mackinac based upon management’s preliminary estimate of their fair values as of June 30, 2021. Nicolet has not completed the valuation analysis and calculations in sufficient detail necessary to arrive at the required estimates of the fair value of Mackinac assets acquired or liabilities assumed, other than a preliminary estimate for intangible assets and certain financial assets and financial liabilities. In addition, certain Mackinac nonfinancial assets and liabilities are presented at their respective carrying amounts and should be treated as preliminary values. Any differences between the fair value of the consideration transferred and the fair value of the assets acquired and liabilities assumed will be recorded as goodwill. Accordingly, the purchase price allocation and related adjustments reflected in these unaudited pro forma condensed combined financial statements are preliminary and subject to revision based on the final determination of fair value.

Note 2. Preliminary Purchase Price Allocation for Mackinac

The following table summarizes the preliminary purchase price allocation of the estimated merger consideration to the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed of Mackinac using Mackinac’s unaudited consolidated balance sheet as of June 30, 2021.

(In thousands, except per share data)	Mackinac Net Assets at Fair Value
Cash and cash equivalents	$	353,904
Investment securities	101,955
Loans held for sale	1,535
Loans	969,133
Allowance for credit losses	(5,905)
Other real estate owned, net	679
Core deposit intangible	4,800
Other assets	66,849
Total Assets	$	1,492,950
Deposits	$	1,307,654
Short-term borrowings	—
Other long-term borrowings	28,541
Other liabilities	26,038
Total Liabilities	1,362,233
Net assets acquired	$	130,717
Purchase price:
Shares of Mackinac outstanding	10,624
Exchange ratio	0.22
Pro Forma Nicolet shares to be issued	2,337
Nicolet closing stock price on September 2, 2021	$	76.74
Pro Forma stock consideration	$	179,363
Pro Forma cash consideration	$	49,295
Total Pro Forma purchase price	$	228,658
Preliminary goodwill	$	97,941

Note 3. Pro Forma Adjustments to the Unaudited Condensed Combined Balance Sheet

The following pro forma adjustments have been reflected in the unaudited pro forma condensed combined balance sheet.All taxable adjustments were calculated using a 27% tax rate, which represents Nicolet’s statutory rate, to arrive at deferred tax asset or liability adjustments.All adjustments are based on preliminary assumptions and valuations, which are subject to change.

A. Total pro forma purchase price consideration of approximately $230 million comprised of the issuance of approximately 2.3 million shares of Nicolet common stock at a price of $76.74, based on the Nicolet closing stock price on September 2, 2021 (the last trading day prior to the consummation of the acquisition), for pro forma stock consideration of approximately $180 million and pro forma cash consideration of approximately $50 million.

B. Nicolet to write-off its investment holding of 30,000 shares of Mackinac common stock (carried at the Mackinac market price of $19.76 on June 30, 2021) for a reduction to investments of $593,000, a decrease of $160,000 to the deferred tax liability, and a $433,000 net equity reduction.

C. Adjustment to loans to reflect estimated fair value adjustments, which include lifetime credit loss expectations for loans, current interest rates and liquidity, as well as the gross up of purchased credit deteriorated (“PCD”) loans. The adjustment includes the following.

(In thousands)	June 30, 2021
Reversal of historic Mackinac loan fair value adjustments	$	1,391
Estimate of loan fair value adjustments	(14,683)
Net pro forma fair value adjustments	(13,292)
Gross up of PCD loans for credit mark (see also D below)	5,905
Cumulative pro forma adjustments to loans	$	(7,387)

D. Adjustment to the allowance for credit losses include the following.

(In thousands)	June 30, 2021
Reversal of historical Mackinac allowance for credit losses	$	5,651
Estimate of lifetime credit losses for PCD loans (see also C above)	(5,905)
Estimate of lifetime credit losses for non-PCD loans	(13,892)
Cumulative pro forma adjustments to the allowance for credit losses	$	(14,146)

E.	Adjustment of $664,000 to mark Mackinac’s other real estate owned to fair value, based on Nicolet’s assessment of property resolution.
F.	Adjustment to eliminate Mackinac’s historical goodwill of $19.6 million and record estimated goodwill associated with the merger of $97.9 million.
G.	Adjustment to eliminate Mackinac’s existing core deposit intangible of $4.2 million and record a new core deposit intangible of $4.8 million.
H.	Adjustment to deferred tax related to all fair value marks noted in these pro forma adjustments to the condensed combined balance sheet.
I.	Adjustment to mark Mackinac’s Federal Home Loan Bank advances to fair value by $100,000 and to reflect current market rate of interest on deposits of $500,000.
J.	Adjustment to record estimated merger-related transaction costs of $20 million, net of deferred taxes of $5.4 million.
K.	Adjustment to eliminate Mackinac’s common equity and record the issuance of Nicolet pro forma stock consideration (as noted in A above).

Note 4. Pro Forma Adjustments to the Unaudited Condensed Combined Statements of Income

Pro forma net income includes one-time estimated merger-related transaction costs (see item E below), as well as the Day 2 adjustment to record provision expense and the corresponding increase to the allowance for credit losses (see item C below, as well as Note 3 item D above), but does not reflect potential synergies and other estimated cost savings that may arise from the combination.

A.	Net fair value adjustments to interest income to eliminate Mackinac’s accretion of discounts on previously acquired loans and record the estimated accretion of the net discount on acquired loans. For purposes of the pro forma impact, the net discount accretion was estimated using a period of 3 years.
B.	Net fair value adjustments to interest expense for deposits and FHLB advances assuming straight-line over a 3 year weighted average life.
C.	Adjustment to record provision expense on Mackinac’s non-PCD loans, including adoption of the current expected credit losses (“CECL”) methodology for the Mackinac loan portfolio (Day 2).
D.	Net adjustment to core deposit intangible amortization to eliminate Mackinac core deposit intangible amortization and record estimated amortization of acquired core deposit intangible. Core deposit intangible will be amortized using the sum-of-the-years digits method over ten years.
E.	Adjustment to reflect merger-related transaction costs of $20 million.
F.	Adjustment to income tax expense to record the income tax effects of pro forma adjustments at the estimated statutory effective tax rate of 27%.
G.	Adjustments to weighted average shares to eliminate the weighted average shares of Mackinac common stock outstanding, and record the issuance of Nicolet common stock, calculated using the exchange ratio of 0.22 per share.

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Cover	Sep. 03, 2021
Cover [Abstract]
Document Type	8-K
Entity Registrant Name	NICOLET BANKSHARES, INC.
Entity Incorporation, State or Country Code	WI
Entity File Number	001-37700
Entity Tax Identification Number	47-0871001
Entity Address, Address Line One	111 North Washington Street
Entity Address, City or Town	Green Bay
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	54301
City Area Code	920
Local Phone Number	430-1400
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common stock, par value $0.01 per share
Trading Symbol	NCBS
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0001174850
Amendment Flag	false
Document Period End Date	Sep. 03, 2021