Subsequent Events

6 Months Ended

Jun. 30, 2024

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Pending Acquisition

On July 29, 2024, the Company entered into an Agreement and Plan of Reorganization with Heartland BancCorp (“Heartland”), pursuant to which Heartland agreed to merge with and into the Company. The merger agreement also provides that Heartland’s wholly-owned banking subsidiary, Heartland Bank, will be merged with and into the Company’s wholly-owned banking subsidiary, German American Bank, immediately following the holding company merger. Heartland is a financial holding company headquartered in Columbus, Ohio. As of June 30, 2024, Heartland Bank operated 20 full-service banking offices and had, on an unaudited basis, approximately $1,920,132 of total assets, $1,549,420 of total loans and $1,645,193 of total deposits.

Under the terms of the merger agreement, each record holder of Heartland common stock (other than dissenting shares and shares held in the Heartland 401(k) plan) will receive, for each share of Heartland common stock, 3.90 shares of the Company’s common stock in a tax-free exchange. Heartland Bank, as the administrator and record holder of shares of Heartland common stock held in the Heartland 401(k) plan, will receive in exchange for each share of Heartland common stock held in such plan,

on behalf of the beneficial owners of such shares, a cash payment based on the 3.90 exchange ratio. Any option to acquire a share of Heartland common stock outstanding at the closing of the merger will be cancelled in exchange for a cash cancellation payment based on the 3.90 exchange ratio, less the option exercise price per share and any applicable withholding taxes.

Based on the number of shares of Heartland common stock currently outstanding, the Company expects to issue approximately 7.66 million shares of its common stock, and pay approximately $24,967 in cash (based upon a $39.84 per share volume-weighted average price for the Company’s common stock over the 10-day trading period ended July 26, 2024, the business day immediately preceding the date that the merger was announced), in exchange for all of the issued and outstanding shares of Heartland common stock (including the shares held in the Heartland 401(k) plan) and in cancellation of all outstanding options to acquire Heartland common stock.

Consummation of the merger is subject to approval by federal and state banking regulatory authorities, approval by the shareholders of both the Company and Heartland, and certain other closing conditions. Assuming such approvals are timely secured, the Company expects that the merger will be completed in the first quarter of 2025.

This pending bank acquisition will be consistent with the Company’s strategy to enhance its scale and diversify its footprint by expanding into Columbus, Ohio, and Greater Cincinnati, two desired growth markets in the Midwest. The acquisition offers the Company the opportunity to increase profitability by introducing existing products and services to the acquired customer base as well as add new customers in the expanded region.